Disagreements surface over China-backed trade deal
- Author: Zachary Reyes May 23, 2017,
May 23, 2017, 8:57
The 16-nation Regional Comprehensive Economic Partnership (RCEP) is poised to become the largest free trade agreement in the world, covering about half of its population.
Trade ministers from the Asia Pacific are meeting in Hanoi to speed up negotiations seeking to finalize a regional trade pact amid fears of growing trade protectionism.
APEC countries failed to come out with their usual joint statement after the United States rejected language on fighting protectionism which Asian countries wanted to include.
USA officials attending the Asian Pacific Economic Cooperation (APEC) forum in Hanoi, Vietnam over the weekend, opposed language that called for all member-countries to "fight against all forms of protectionism", according to Reuters. However, one of Trump's first decisions as president was to withdraw from the pact, citing the need to fight for "fair but tough" bilateral trade deals. Although the TPP members kept the trade agreement alive, they fell short of a wholehearted commitment to advance immediately with the deal.
Canada's Trade Minister Francois-Philippe Champagne said the focus should be on actions rather than statements.
Seko met last weekend in Hanoi with new the US trade representative Robert Lighthizer, and said the two agreed to build on the Japan-US economic dialogue agreed to months ago by their leaders. The countries have yet to agree how to take forward the deal however.
A statement from Mr Lighthizer said free trade required the tackling of "trade-distorting measures" that have led to "massive United States trade imbalances" in the region - a possible reference to China's trade surplus, which was almost $US350 billion in 2016.
Apec member economies have contributed about 78 per cent of the total FDI inflows to Vietnam, 75 per cent of total merchandise trade and 79 per cent of the total number of tourists to the country.
"New Zealand believes that the agreement is very well balanced and needs little renegotiation perhaps other than the way it enters into force", Trade Minister Todd McClay said in an interview Sunday at a meeting of Asia-Pacific trade ministers in Hanoi, Vietnam. As recently as November, Abe said a TPP deal without the USA would be "meaningless".
Mr Burke said it might even be possible that the TPP will cross the finish line first, given that the RCEP talks include negotiations with giant economies such as India and China.
For the U.S. part, Lighthizer held discussions on the sidelines of APEC with individual countries, in line with the Trump administration's pursuit of preferential bilateral deals.
The United States pulled out of the TPP - frequently called a "21 century trade agreement" - soon after US President Donald Trump took office in January. "Bilateral negotiations are better for the United States", the 69-year old former Ronald Reagan trade negotiator said in Hanoi.
"If Japan does nothing, China will grab a leading role in setting free trade rules, in turn putting Japan at a disadvantageous position in the trade field in the region", Political commentator Norio Toyoshima said.