TPP, RCEP, FTAAP: a user’s guide to trade acronyms

The Myanmar Times - - International Business -

PA­CIFIC Rim lead­ers met in Peru at the week­end to push for con­tin­ued free trade against the back­drop of ris­ing pro­tec­tion­ism glob­ally.

Here is a guide to the main re­gional free trade pacts dis­cussed.

Trans-Pa­cific Part­ner­ship (TPP) Led by the United States, the TPP in­volves 12 coun­tries in­clud­ing Ja­pan, Malaysia, Viet­nam, Sin­ga­pore, Brunei, Aus­tralia, New Zealand, Canada, Mex­ico, Chile and Peru.

It has been de­scribed by the US as a “gold stan­dard” for all free trade agree­ments be­cause it goes be­yond just cut­ting tar­iffs.

It in­cludes re­mov­ing a slew of non-tar­iff mea­sures and re­quires mem­bers to com­ply with a high level of reg­u­la­tory stan­dards in ar­eas like labour law, en­vi­ron­men­tal pro­tec­tion, in­tel­lec­tual prop­erty and gov­ern­ment pro­cure­ment.

The TPP no­tably ex­cludes China, the main Asian power and the world’s sec­ond-big­gest econ­omy.

An­a­lysts say the TPP is the eco­nomic plank of out­go­ing US Pres­i­dent Barack Obama’s strate­gic re­bal­ance to Asia.

How­ever, it faces un­cer­tainty un­der US Pres­i­dent-elect Don­ald Trump, who has said he will not sup­port the agree­ment be­cause he deems it dis­ad­van­ta­geous to his coun­try.

Re­gional Com­pre­hen­sive Eco­nomic Part­ner­ship (RCEP) Backed by China, the RCEP in­volves the 10 mem­bers of the As­so­ci­a­tion of South­east Asian Na­tions (ASEAN) – Brunei, Cam­bo­dia, In­done­sia, Laos, Malaysia, Myan­mar, the Philippines, Sin­ga­pore, Thai­land and Viet­nam – plus their trad­ing part­ners China, Ja­pan, South Korea, Aus­tralia, New Zealand and In­dia.

It no­tably ex­cludes the United States.

Com­pared with the TPP, the RCEP also aims to cut tar­iff and non-tar­iff bar­ri­ers but calls for lower and more lim­ited reg­u­la­tory stan­dards.

It also ex­empts cer­tain goods from the tar­iff cuts to pro­tect lo­cal sec­tors and al­lows the less de­vel­oped mem­bers more time to com­ply.

Gov­ern­ments missed a dead­line to con­clude ne­go­ti­a­tions last year. But the RCEP has been un­der the spot­light as the fate of the TPP hangs in the bal­ance.

Free Trade Area of the Asia Pa­cific (FTAAP) The FTAAP is a long-term goal to link Pa­cific Rim economies from China to Chile, in­clud­ing the United States.

It aims to har­monise the “noo­dle bowl” of re­gional and bi­lat­eral free trade agree­ments that had pro­lif­er­ated fol­low­ing the col­lapse of the Doha Round of the World Trade Or­gan­i­sa­tion talks in 2006.

Asia-Pa­cific pol­i­cy­mak­ers say there are sev­eral path­ways to re­al­is­ing the FTAAP, in­clud­ing both the TPP and the RCEP.

An­a­lysts say that with the un­cer­tainty over the TPP, the RCEP has emerged as the main path­way to­ward the re­al­i­sa­tion of a tran­sPa­cific free trade agree­ment.

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