Ministers of the 11 remaining signatories to the Trans-Pacific Partnership (TPP) free trade deal reached a broad agreement on a new trade pact to be brought to effect without the United States, after much wrangling until the very last minute.
After the U.S. pulled out of what was originally a 12-nation pact, the remaining signatory countries called for a review of an earlier agreement, threatening to water down a high-level free trade framework envisioned under the TPP.
Despite concerns that the pact's economic effects would be diminished without the economic superpower that is the United States, the remaining signatories, including Japan, managed to reach an accord based on the belief that high-quality economic cooperation would ultimately bring benefits to their respective countries as a result of development in the Asia-Pacific region.
Under the new TPP deal, the basic policy of tariff reduction and elimination will remain intact, while the signatories narrowed down the number of common rules to be frozen with regard to corporate production and sales activities. The resultant new agreement is one aimed at boosting trade and investment and contributing to the development of the region -- even without U.S. participation.
It is regrettable that the new pact failed to gain the stamp of approval from TPP leaders as the summit meeting was put off due to Canada's objection. It is hoped that the leaders will maintain unity and sign the pact at an early date to make it a cornerstone of efforts to re-establish the free trade system.
The TPP deal will also serve as a deterrent against the "America First" trade policies advocated by the administration of U.S. President Donald Trump.
While the U.S. may possibly press other countries to form bilateral free trade agreements in favor of the U.S. and unilaterally demand their market liberalization, the TPP pact can shun such potential U.S. requests as it has set a rule for reciprocal market liberalizations among the signatories.
Since the TPP's ultimate goal is to boost the economies in the Asia-Pacific region, the new accord will surely lead to benefits for U.S. interests as well.
President Trump was in Danang, Vietnam, where the "TPP11" ministers met, and gave his first speech on the U.S. policy toward Asia at the APEC CEO Summit. He emphasized that the U.S. has been and will be a partner in the Indo-Pacific, and although his speech forwent a systematic strategy encompassing security, it is noteworthy that the U.S. leader demonstrated his country's willingness to make a positive commitment to Asia.
Trump also re-emphasized his eagerness to promote negotiations for bilateral trade agreements with countries in the Indo-Pacific region. It is irresponsible for such a superpower as the U.S. to stick to methods that can only serve its own interests. What is indispensable for the stability and development of Asia is a multinational economic partnership like the TPP, which was originally spearheaded by the U.S.
The new TPP pact can serve as a driving force in urging Washington to return to the multilateral deal. If TPP members boost their agricultural exports to Japan, it would adversely affect U.S. exports to the country. Therefore, the new pact is expected to give rise to calls within the U.S. agricultural sector to return to the TPP.
We need to make persistent calls on the U.S. to reconsider its pullout from the TPP club. Prime Minister Shinzo Abe boasted he has forged "deep bonds" with President Trump. If that is the case, Abe should make the most of such close ties to persuade Trump to reinstate his country's TPP membership.