What if the Trans-Pacific Partnership (TPP) is not a doomed initiative – and what if it will actually make inroads into modern trade problems? The Asia-Pacific region is now the world’s centre of economic gravity holding an increasing share of world production and promising a rapid turn into the world’s fastest growing consumer market. TPP will change the competitive relation between European and American firms as far as access to this market is concerned.
The negotiations now include Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US, and Vietnam. Influential actors, including South Korea, Philippines, Taiwan, Thailand, (and even China) have formally or informally shown their interest in joining the negotiations. There is no reason to doubt that TPP is the new agenda-setting pillar in the Asia-Pacific region and beyond representing 60% of world trade – the same level as GATT during the 1980s.
In the short term, TPP will be the first ‘competing’ economic integration that is large enough to have a considerable negative impact on Europe. In the long-term, the negative effects will come from dynamic impact, e.g. on investment, productivity and competitiveness. It also presents a ‘deadly threat to European exporters of agricultural products in TPP countries’.
Europe negotiates bilaterally with some TPP countries, but it has no strategy equivalent to the TPP. The ongoing bilateral negotiations with Canada, Japan, Malaysia and Vietnam have been facing difficulties due to the priority given to TPP. The trans-pacific negotiations even add pressure on the EU’s relations with countries such as Mexico and Chile, with whom FTAs are already in place. Australia and New Zealand are not being addressed at all.
Europe’s trade agenda cannot be underpinned by TTIP and plurilateral initiatives alone. These problems presented by the new regional economic architecture emerging in Asia-Pacific, where TPP is an inherent part, present a strategic imperative to conclude the Global Europe agenda more rapidly and comprehensively than before.