Alexa

Commercial Times: Keep close tabs on new shifts in TPP

Commercial Times: Keep close tabs on new shifts in TPP

Evolving Asia Pacific regionalism has recently seen two positive developments: U.S. congressional approval of the country's free trade agreement (FTA) with South Korea and progress in talks on the Trans-Pacific Partnership Agreement (TPP). Malaysia agreed to join the TPP talks last year, and Japan reportedly will throw its explicit support behind the TPP initiative at the annual meeting of the Asia-Pacific Economic Cooperation (APEC) summit to be held in Hawaii later this month. Moreover, South Korea, Thailand, the Philippines and Canada are also expected to join the TPP talks sooner or later. With the participation of these countries, the TPP, which is being negotiated by the United States and eight trading partners -- Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, and Vietnam -- will become the world's largest free trade area, accounting for 40 percent of the world's gross domestic product. The positive TPP developments can mainly be attributed to the stalled Doha Round of World Trade Organization (WTO) talks. The setback in multilateral trade talks has led to the rise of regional trade blocs that emphasize differential treatment for countries inside and outside the blocs. U.S. President Barack Obama is committed to making the TPP the best free trade model for the 21st century. Knowing tough barriers stand in the way of TPP talks, the U.S. government is studying flexible measures to cater to the needs of countries at different levels of development and is scheduled to unveil major TPP initiatives at the upcoming APEC conference. Taiwan's delegation to the APEC conference should express its strong desire to join the TPP. Taiwan has lagged far behind in FTA talks, with only five such pacts struck with its diplomatic allies, which jointly account for a mere 0.4 percent of its total foreign trade. Even though it signed an Economic Cooperation Framework Agreement with China last year, only 16 percent of the two sides' bilateral trade was covered in the accord's "early harvest" program. Overall, only about 5 percent of Taiwan's exports are subject to free trade benefits, far lower than America's 38 percent, Korea's 36 percent and Japan's 16 percent. Diplomatic isolation has led to enormous difficulties for Taiwan to sign FTAs with countries that recognize China. If it fails to join the TPP, it will be further sidelined and face more stumbling-blocks in future world trade. (Editorial abstract -- Nov. 7, 2011). (By Sofia Wu)


Updated : 2020-11-30 07:35 GMT+08:00