|APEC meeting to discuss the Trans-Pacific Partnership Agreement
The Asia-Pacific Economic Cooperation (APEC) Economy Leaders gathered in Hawaii for the final APEC Leader's Summit on 12-13 November 2011 of the US Presidency. The aim of the 21 member APEC forum is to lower trade barriers and increase economic cooperation in the Asia-Pacific region. At the Summit, APEC leaders pledged to work together to achieve the broad outlines of a plan that could work as the model of a new Trans-Pacific free trade zone, spanning the Pacific Ocean from coast to coast, known as the Trans-Pacific Partnership (TPP).
The proposed free trade zone could serve as a model not only for the region but in light of the failure of the latest Doha Round negotiations, it could also serve as a model for other global trade pacts. The current Trans-Pacific Partnership members include Chile, Brunei, New Zealand and Singapore, with America, Australia, Japan, Malaysia, Perú, and Vietnam already in negotiations to join. Canada, México and Colombia are also considering joining.
The US President, Barack Obama, has said publicly that he hopes the Trans-Pacific Partnership will be the cornerstone of an APEC-wide free-trade area. In a similar statement, the Chinese President, Hu Jintao, too said that China supported the proposal for an APEC-wide free trade area from coast to coast in the Asia-Pacific Region.
Many of the smaller Trans-Pacific Partnership countries welcome Japan’s participation for the access it would give them to a second giant market, alongside America’s. The treaty’s ambitions are for free movement of almost everything with the exception of labour. Japan hopes to influence global technological standards in industries like electric cars and clean energy by joining with the US.
US and China - both part of the Asia-Pacific Region
By agreeing to open negotiations to join the Trans-Pacific Partnership, the US President is clearly seeking to re-establish the US as a Pacific nation. The Trans-Pacific Partnership is a symbol of the shift in the world’s centre of economic gravity from the Atlantic to the Pacific Ocean. If the ten-country deal is concluded, it will cover a market 40pc bigger than the European Union.
The US and Asia-Pacific countries need to maintain productive relationships with China, especially over the coming years 2012-2013, while China prepares for an internal leadership change within the Communist Party and at the same times goes through a period of introspection about its future role in the world. It is important that the US re-engagement is not seen as a path to confrontation with China. Rather, how China emerges from this process and the policies it chooses to implement in the Asia-Pacific region and globally will determine much about what the world will look like in the medium and long term.