Pacific Currents

Kenichi Kawasaki
Consulting Fellow, Research Institute of Economy, Trade and Industry (RIETI)
Senior Fellow, National Graduate Institute for Policy Studies (GRIPS)
Adjunct Fellow, Japan Institute of International Affairs (JIIA)

Summary
Quantitative studies using an economic model show the Trans-Pacific Partnership (TPP) and Regional Comprehensive Economic Partnership (RCEP) complement each other rather than be competitors toward the establishment of the Free Trade Area of the Asia-Pacific (FTAAP).  Breaking down the sources of those macroeconomic benefits by the policy measures of Asia-Pacific Economic Cooperation (APEC) member economies showed that the contribution by China would be the largest.  Nonetheless, in many countries of Association of South‐East Asian Nations (ASEAN) and outside this region, contributions by a country’s own initiatives will be much larger than those by its trade partners, including China.  Meanwhile, larger economic benefits are expected from NTMs reductions in addition to tariff removals.  It is thus suggested that domestic reforms are essential in order to enjoy the macroeconomic benefits of international Economic Partnership Agreements (EPAs). 

Steven CM Wong
Senior Director, ISIS Malaysia

LOGIC: The more extensive and deeper an agreement is, the more likely it is to be the de facto standard

How does the Trans-Pacific Partnership (TPP), now being negotiated among 12 Asia-Pacific countries, including four from Asean, impact the latter's  Regional Comprehensive Economic Partnership (RCEP)?

It is easy to claim, as some have done, that both are building blocks towards freer trade. But are they really? This claim is further doubtful if the two blocks are of different size, weight and degree of ambition.

Peter A. Petri
Non-resident Senior Fellow with the East-West Center
Professor of International Finance at Brandeis University

Republished from the East West Center

(This analysis originally appeared in the Honolulu Star-Advertiser on Oct. 16, 2011 as part of a monthly series on regional Asia Pacific issues leading up to the APEC leaders’ meetings in Honolulu in November)

In the last half century, world trade has grown twice as fast as output and helped to lift the majority of the world’s people from poverty—a feat unimaginable a generation ago. When APEC leaders meet in Honolulu next month, they will represent countries that account for half of world trade. Can APEC help to keep the engine humming for another half century?

Ganeshan Wignaraja
Principal Economist, Office of Regional Economic Integration, Asian Development Bank

Slow progress in the WTO Doha Round trade talks has seen China and India have focussing on free trade agreements (FTAs) as a vehicle of trade strategy and economic diplomacy. By mid-2011, the two Asian giants were among Asia's leaders in FTA activity with 11 each in effect in both China and India. The number of FTAs under negotiation and proposed suggested that such activity will rise in the future, as China has another 13 agreements in the pipeline and India another 20. China has FTAs with ASEAN, Hong Kong, Macao, Chinese Taipei, Pakistan, New Zealand, Chile and Peru, among others.

Christopher Findlay
University of Adelaide
Vice-Chair AUSPECC

This article is cross-posted from the East Asia Forum website

Japanese politicians are still debating whether Japan should join the Trans-Pacific Partnership (TPP). TPP members are not allowed exclusions. Agriculture is the issue, specifically the domestic political constraints imposed by protection of that sector in Japan. At the same time, the business sector is pushing hard to join.