ECONOMY

China’s request to join transpacific pact will be judged on merit, say US allies

Comprehensive and Progressive Agreement for Trans-Pacific Partnership updates

Japan has said China’s “readiness” to join a transpacific trade pact originally designed by Washington to limit Chinese influence in the region would need to be judged on its merits after Beijing filed a surprise formal application to join the group.

For China to sign up to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, which was started by former US president Barack Obama, Beijing would need to meet the deal’s requirements in areas related to intellectual property, state subsidies and state-owned enterprises, Japan said.

“We need to carefully assess whether China is prepared to meet [CPTPP’s] very high standards,” Yasutoshi Nishimura, the economy minister, said.

The predecessor of the CPTPP was the Trans-Pacific Partnership, a trade agreement signed in 2016 by the US, Australia, New Zealand, Japan and seven other countries.

It was originally negotiated by Obama to ensure that Washington, rather than Beijing, kept a hand in regional trade and investment rules. But in 2017, Donald Trump, Obama’s successor, abandoned the trade pact.

In November 2020, Xi Jinping, the Chinese president, said that his administration would “favourably consider” applying for membership.

Japan, which holds the rotating CPTPP chairmanship this year, was surprised by the timing of China’s application, which was made without any warning from Beijing, according to a Japanese government official.

The Chinese commerce ministry’s written request to join the CPTPP was delivered to the New Zealand embassy in Beijing on Thursday. It came just a day after the US, Australia and the UK announced a military partnership, dubbed Aukus, that will strengthen the allies’ ability to challenge China’s military rise. The UK applied to join the CPTPP in January.

“The next step in this process is for the CPTPP group as a whole, through Japan as chair, to determine whether to commence an accession process with China,” said New Zealand’s foreign ministry.

Former Chinese government officials and analysts said that Aukus, which was sharply criticised by Beijing, may have been the trigger for formally requesting membership.

But they added that the decision to join was clearly signalled by Xi’s comments last year. “I don’t think it’s entirely a coincidence,” said a former Chinese commerce ministry official, who asked not to be identified.

“But there are lots of internal hoops to jump through before the commerce ministry can submit a big application like this.”

Stephen Jacobi, a former New Zealand trade negotiator, said Beijing “clearly senses an opportunity”. “The Chinese,” he added, “have been watching very carefully the Americans’ continual rebuffing of the CPTPP.”

President Joe Biden’s administration has said it still had labour and environmental concerns about the group, and would “not rejoin the TPP as it was initially put forward”.

The Australian government did not react immediately to China’s formal application. Last year it welcomed Xi’s expression of interest in joining.

A western diplomat said Ottawa’s response to Beijing’s application would hinge on the results of Monday’s federal election. Erin O’Toole, the opposition Conservative leader, said he would take a tougher approach towards China than Justin Trudeau, the Canadian prime minister, if he won.

Like Australia, which angered Beijing by arguing for a thorough investigation into the origins of the Covid-19 pandemic, Canada’s relationship with China is at a historic low.

China retaliated to the 2018 detention of Huawei executive Meng Wanzhou in Vancouver by detaining two Canadian citizens.

“The biggest concern is whether China will meet the conditions of the CPTPP,” said Nguyen Khac Giang, a New Zealand-based scholar who specialises in relations between China and Vietnam, another influential member.

“It will take a really long time to negotiate with other countries if China is really serious about this.”

Before Covid-19, Vietnam was one of Asia’s fastest-growing economies, thanks in large part to its network of free trade agreements, including the CPTPP and its recently ratified free trade agreement with the EU.

Tom Mitchell in Singapore, Edward White in Seoul, Kana Inagaki in Tokyo, John Reed in Bangkok and Anthony Klan in Sydney

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