On Friday, the U.S. Senate passed the presidential trade promotion authority proposal, which intends to give Obama the authority to negotiate the TPP trade agreement. Chilean Deputy Minister of Trade Andres Rebolledo believes that TPP negotiations have entered the “final stage.”
As the Chilean representative in TPP negotiations, Rebolledo told the Wall Street Journal on Saturday that the U.S. Senate’s passage of the President’s Trade Promotion Authority Proposal (TPA) means that the TPP Agreement (Trans-Pacific Partnership) has made significant progress.
After the Senate passes the TPA, the House of Representatives will also vote. Once passed again, Obama will have the right to propose proposals to Congress. Congress has the power to approve or veto, but cannot amend the content of the agreement. President Obama regards this “authorization” as a “top priority” for the rest of his term, and made it clear that the passage of this “authorization” is crucial to the TPP negotiation process.
Fred Bergsten, former director of the Peterson Institute for Economic Research, a Washington think tank, believes that China has always believed that the TPP will pose a threat to China’s trade and security. He said: “China has always been the strongest opponent of the TPP. China believes that the TPP is a tool for the United States to contain, isolate, and restrict China. If the TPP is finally negotiated, it will cause China’s exports to lose up to 100 billion U.S. dollars every year.”
Obama has warned that if the TPP fails, the United States’ status as a global trade referee will be weakened by China.
After being excluded from TPP negotiations, China has joined negotiations for another Asian trade agreement, the 16-country Regional Comprehensive Economic Partnership (RCEP), which is expected to be concluded this year.
China is also pushing all parties to negotiate on the Free Trade Area of the Asia Pacific (FTAAP) to highlight its increasing international status. But China’s efforts have met with resistance from the United States.
Wang Shouwen, Assistant Minister of the Ministry of Commerce of China, publicly stated at the China Development Forum on March 21 that the new round of negotiations launched by TPP member states in March this year “did not invite China to participate”, but “China is paying close attention to the TPP Progress in Negotiations”.
Rebolledo said that many TPP participating countries believe that the determination and completeness of the agreement’s content will be the key to the success of negotiations. “Participating countries are currently discussing the TPP at a technical level. New progress can only be made after the final political factors are determined.”
The TPP agreement is led by the United States. The TPP negotiations consist of two parts: first, areas decided jointly by all 12 participating countries, such as intellectual property protection rules; second, areas of bilateral consultation, such as tariff reductions and exemptions for certain items. Among the 12 participating countries, the United States and Japan have huge economic aggregates, and the combined share of all participating countries in the global economy has reached 40%.
