What does the trade war and the flurry of mega-trade agreements such as the Trans-Pacific Partnership (TPP) and the Regional Comprehensive Economic Partnership (RCEP)—the first excluding China, the second including China, but excluding the U.S.—mean for global trade and the future of the World Trade Organization?
The recent agreement of the Trans-Pacific Partnership is about far more than trade. It’s about creating a new international regime in the Pacific that will reinforce trade rules, smooth inter-state relations and promote international harmony with China.
In the final stages of the Trans-Pacific Partnership negotiations, the U.S. is still pushing for the elimination of safeguards to regulate capital inflows and capital flight. Those controls have mitigated past crises and prevent others in economies that for decades have been buffeted by financial instability.
The proposed Trans-Pacific Partnership is about far more than trade. It’s about creating a new international regime in the Pacific that will reinforce trade rules, smooth inter-state relations and promote international harmony with China.
The TransPacific Partnership that is currently being negotiated will be neither an apocalypse nor a panacea. But what it will do is provide critical legal and institutional guarantees that will draw Asian investors to Latin America.
The negotiation of the Trans-Pacific Partnership should force a serious discussion of the goals of U.S. bilateral development assistance in the region. As U.S. policy invests more to promote trade integration and link it to global geo-strategic goals, it’s time to think about how to recast development assistance to help countries participate and compete in these new trade agreements.
