Trade ministers to discuss TPP revival on Apec sidelines

Trade ministers to discuss TPP revival on Apec sidelines
A sign promoting the Apec Summit in Hanoi, Vietnam. United States Trade Representative Robert Lighthizer is due to give more details of Washington’s trade plans at the meeting this month. Photo: REUTERS

Trade ministers to discuss TPP revival on Apec sidelines

Move could aid members’ bargaining position with US, undercut China’s clout in region

HANOI — Japan and other remaining members of the Trans-Pacific Partnership (TPP) will this weekend decide how to revive the trade agreement ditched by United States President Donald Trump.

Their trade ministers will talk on the sidelines of an Asia-Pacific Economic Cooperation (Apec) meeting in Hanoi, Vietnam, where newly appointed US Trade Representative Robert Lighthizer is also due to give more details of Washington’s trade plans.

Uncertainty over those plans after Mr Trump abandoned a trade deal he had compared to the “rape” of America has brought fears of protectionism and strengthened China’s leadership credentials in Asia.

Support has grown among the so-called TPP-11 for pushing ahead without the US, although trade within the smaller bloc is only a quarter of that between the original 12 members, according to the most recent data.

Moving ahead could help the bargaining position of the members in bilateral talks with the US.

It could also undercut the increasing regional dominance of China, which is not part of the TPP and backs a bigger but less comprehensive free trade agreement for Asia.

“We’ll be looking to see whether TPP ministers say they are definitely pushing ahead by simply by changing the articles,” said Mr Alan Bollard, executive director of the Apec Secretariat. “Or whether they come out and say they’re positive about the prospects but need more discussions,” he told Reuters in Hanoi.

After initially appearing reluctant to move ahead without the US, Japan is at the forefront of the push, along with New Zealand. Japan has emphasised that it would ultimately like to bring the US back in.

“Since we have come thus far, we would like to capitalise upon the results of our long years of efforts. So I think Japan must now take on a leadership role and move the discussion forward,” said Japanese Prime Minister Shinzo Abe in an interview with CNBC aired on Tuesday.

“In the upcoming TPP ministerial meeting in Vietnam, I wish to seek the solidarity and the unity of the 11 countries, so that they can come up with a clear direction of where we want to go from this point onward.

“Since the US understands the importance of having free and fair trade rules, by all means our strong wish is that US will return to TPP.”

Vietnam would have been one of the biggest beneficiaries of the original TPP, because of lower tariffs and more investment from the US. Malaysia is in a similar position and an official there voiced hope of a return to the TPP.

Pushing the TPP forward could help Japan’s position in negotiating a bilateral deal with the US, said Mr Nguyen Xuan Thanh of the Harvard Kennedy School. The same would apply for Vietnam, he said. “It’s part of the game,” he told Reuters. “You don’t want to be seen as desperate for bilateral deals.”

For the TPP to take effect without the US it would have to drop a rule requiring ratification by at least six countries accounting for 85 per cent of the combined gross domestic product of the original member nations. AGENCIES