HANOI, Vietnam – (UPDATED) Asia-Pacific trade ministers agreed Sunday, May 21, to try to revive a massive free trade pact, even though the United States reaffirmed its decision to pull out, as fears grow of a new global era of protectionism.
The 12-nation Trans-Pacific Partnership covered 40% of the global economy before Trump abruptly abandoned it in January to meet a campaign pledge to save American jobs which he says have been sucked up overseas.
Japan, Australia and New Zealand are leading efforts by the so-called Trans-Pacific Partnership (TPP) 11 to resuscitate the agreement, convinced it will lock in future free trade and strengthen labor rights and environmental protections.
After an early-morning huddle in the Vietnamese capital Hanoi, New Zealand Trade Minister Todd McClay told reporters the TPP 11 “are committed to finding a way forward to deliver” the pact.
Trade representatives agreed to help the United States to rejoin the deal at any time, pinning hopes on a U-turn in American policy.
The TPP was in part crafted as a counterweight to the burgeoning economic might of China.
But Trump’s newly-appointed trade chief Robert Lighthizer poured cold water on the prospect of a US return, saying Washington “pulled out of the TPP and it’s not going to change that decision”.
“The TPP 11 can make their own decisions, the United States makes its decisions, that’s what sovereign nations do,” Lighthizer told reporters, adding his nation will “stay engaged” in the area, albeit on a bilateral basis.
Spearheaded by then-US president Barack Obama, the far-reaching TPP – which notably excludes China – would have rewritten the rules of 21st century trade.
After 7 years of negotiations the finalised proposal was signed in February last year, but cannot go into force until it is ratified by six countries with a combined 85 percent of the bloc’s total GDP.
The deal goes further than most existing free trade pacts, with labour laws, environmental protections and intellectual property rights touted as a new gold standard for global trade.
It promised to transform smaller economies such as Vietnam by offering unprecedented access to the world’s top economies.
Balance of power
The deal was also seen as a way to counter Beijing’s regional economic dominance.
Reviving the TPP, even without the heft of the world’s biggest economy, would still provide ballast against China, analyst Alex Capri told Agence France-Presse.
“The Chinese would not be particularly pleased to see the TPP go ahead even without the United States,” said Capri, a senior fellow and professor at the National University of Singapore.
He did not rule out the eventual return of the United States to the TPP, noting that Trump has “flip-flopped” on other campaign positions in a headline-grabbing first few months in office.
The TPP ministers met on the sidelines of a gathering of trade ministers from the Asia-Pacific Economic Cooperation (APEC) forum in preparation for their November summit.
Lighthizer was also scheduled to meet one-on-one with several ministers, including those from China, Canada and Mexico.
The Reagan-era trade veteran has been tasked with renegotiation of the North American Free Trade Agreement (NAFTA) – another deal Trumped promised to pull out of, though he later backpedalled after speaking to the leaders of Canada and Mexico.
The Trump administration has said it is seeking bilateral agreements rather than sweeping free trade pacts, and is pushing for fair trade with partners and not just free trade. – Rappler.com