Free Trade & China’s Globalization Efforts
With the US pulling back from tree trade agreements and other globalization efforts, China is filling the void.
The Trans-Pacific Partnership was an attempt to make sure the United States maintained a leading role in making global trade rules. And China wasn’t a part of the initial slate of participants.
With the TTP all-but-dead, China is forging ahead to revive their version of a Pacific free trade agreement, the Regional Comprehensive Economic Partnership. And — surprise! — the United States isn’t part of the initial slate.
Why does the TTP & RCEP matter?
Because the winning agreement will likely be the blueprint for a much larger Free Trade Area of Asia Pacific or FTAAP.
It has been a long time goal to create a comprehensive free trade area in the Pacific Rim countries.
And the initial countries in the FTAAP likely to be drawn from the twenty-one countries in the Asia Pacific Economic Cooperation. The biggest economies in APEC are, unsurprisingly, China and the United States.
So the big question is whether future global trade rules will benefit a Chinese or American point-of-view. While there are issues with parts of the TPP and how it was negotiated, there are also geopolitical implications at play as well.
Because China is also expanding its international trade deals in Central & South Asia with its One Belt, One Road plan. If it’s successful, the only other major trading block would be the European Union — and the EU is having their own political problems.
This abdication of leadership is also seen in other global issues with Beijing insisting on implementing global climate change rules even if the future United States government backs out of the Paris agreement.
It’s appears the Chinese point-of-view is winning at the moment because of the United States apparent turn toward protectionism and isolationism.