The Trans-Pacific Partnership: Will it Happen?
Image Credit: Official White House Photo by Pete Souza

The Trans-Pacific Partnership: Will it Happen?


In the future, economic and diplomatic historians could look back at the current negotiations underway between Australia, Brunei, Chile, Canada, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam as a pivotal point in history.  On the other hand, the negotiations could end up bogged down in national interests and “red lines”, leaving the Trans-Pacific Partnership (TPP) the legacy of being yet another failed attempt to expand freer trade between nations.

The TPP is the proposed inheriting organization of the original Trans-Pacific Strategic Economic Partnership Agreement (TPSEP) between founding members Chile, New Zealand, Singapore and later Brunei. Much as the European Economic Community (EEC) grew out of the European Coal and Steel Community (ECSC) and into the European Union (EU) and now the Eurozone (EZ), proponents of the TPP hope that if the negotiations are successful, then the organization can provide both an economic and strategic boost to likeminded nations, although nobody so far is suggesting political integration on the scale seen in Europe.  So far all members and negotiators for the TPP are also Asia-Pacific Economic Cooperation (APEC) members.

For President Obama, the TPP is clearly a strategic issue to both compliment and augment his administration’s “pivot” to Asia.  The pivot is controversial in China and elsewhere because it is a bit vague and has left many guessing as to its significance, purpose and process.  China perhaps correctly sees it as an attempt to form a containing alliance aimed at Beijing’s growing economic power and international assertiveness.  Whether the U.S. is trying to “hedge” against China’s equally ambiguous rise, or genuinely contain it, or whether the TPP is an attempt to put economics front and center of U.S. – Asia relations (rather than strategic issues) are questions that must be left for the future. For now, both the U.S., through former Secretary of State Clinton, and Singapore, through Prime Minister Lee, have openly invited China to join.

These invitations ring slightly disingenuous however, for in its present form, it would be near impossible for China to join the partnership without substantial negotiations and exemptions or domestic changes. The TPP covers many areas, including rules on government procurement, intellectual property and tariffs.

The TPP’s prospects did receive a boost in late December when Japan’s Agricultural Minister Yoshimasa Hayashi announced at a press conference that Japan will deepen discussions with the partnership.  The fact that it was the Agricultural Minister who made this statement is significant.  One key hurdle for Prime Minister Abe to overcome is Japan’s agricultural lobby, which has been opposed to the TPP due to fears that the sector will be hit too hard if protective tariffs are eliminated.   However, the U.S. plan to have the negotiations completed by the end of 2013 (more negotiations are scheduled for March) will probably not include Abe’s Japan. Many observers think that the TPP negotiations will be too controversial for the new Prime Minister to attempt before the July elections for the Upper House.

February 14, 2013 at 08:01

It's just like APEC, all full of sounds and fury, signify nothing. TPP without Japan, South Korea, Indonesia, Thailand, and Philipines just like paper tiger, if its goal is about Cina's containment. Of course these countries can join later, but these countries should join TPP from its first inception to make big statement to the world and, ahem especially China. Right now TPP is just another international meeting forum that produce… well, nothing concrete and looking it's trajectory is pretty much like APEC. Unless of course there's East Asia War occured :)

February 11, 2013 at 18:42

Hey vic,

You buy US Tbonds just for the sake of   safe investment & buying down your RMB for your own export advantage over  other countries & then asking for the  American high-techs stuffs so you folks can copy freely  for your own military use against the US  & its allies. Remember the US is not that stupid or crazy to do business seriously with a global Con  like commie China who just thinks of stealing   others' IPs & disregards any rules or norms  it has  solemnly pledged to abide by. TPP is exclusively for curing Chinese 'beggar-thy-neighbor', mercantilist trade policy.  Got it, commie?

February 11, 2013 at 17:47

I agree with your point on trade suprluses not being good. However, in China's case the trade surplus is the automatic result of China exporting capital abroad (mostly via SAFE). By definition, the current account surplus must equal the capital account.  China's policies force up savings, suppress consumption, and the automatic results is a trade surplus.  GReat for exporters in China, bad for everyone else in China.


China's claims that limits on hi-tech imports are the cause of the trade suprlus is nonsense. If that were so, why does the PBOC intervene in the forex markets so much – distorting its balance sheet and recording huge but unrealised losses as it exports capital to to the US and EU. Why does it keep stockpiling reserves via its exporting of capital! 



February 11, 2013 at 12:52

"It is very political and has to do with "strategic" interests."

Everyone knows that.

Share your thoughts

Your Name
Your Email
required, but not published
Your Comment

Sign up for our weekly newsletter
The Diplomat Brief