The Future of the Trans-Pacific Partnership

There is a fresh piece put out via the Singapore’s Rajaratnam School of International Studies (RSIS) on the origins and evolution of the Trans Pacific Parnership (TPP), a trade agreement currently being negotiated by nine countries – Australia, Brunei, Chile, Malaysia, new Zealand, Peru, Singapore, the United States and Vietnam.

The article delves into important and interesting issues such as how negotiators grappled with the complications of overlapping trading agreements between various counties and managed the domestic political constraints affecting members.

On the key current issue of how the additional members will affect the TPP (Japan, China and Mexico will all expressed interest in joining last year), the authors are conflicted. Many things still remain unclear, including whether new entrants will be allowed to join negotiations in progress or be asked to accede to existing texts, if the lack of Trade Promotion Authority (TPA) in the US for talks with Japan will delay Tokyo’s entry, and how much more complex negotiations will get. The entire agreement also cannot be renegotiated for each new member, so at a certain point, the agreement will have to be closed for new membership (like the WTO) and countries who still want to accede has to accept the deal on the table with only minor modifications.

 But, at the same time, the authors argue:

Even the most enthusiastic supporters of the TPP recognize limited economic benefits in the current configuration. The agreement will not really make a difference until and unless at least one other major economy joins – especially from Northeast Asia. This means that every clause in the TPP has to be negotiated with one eye on potential members. If the agreement is too restrictive, burdensome, or delivers too few benefits, other states will not bother to apply for membership. This will dilute the importance of the whole ageement. Negotiators must continuously remember not only their own narrow interests or even the interests of the bigger, existing group, but also consider the interests of a potentially much larger future institutional grouping.

The article is a chapter in a forthcoming book by the two authors entitled: “The Trans-Pacific Partnership (TPP): The Quest for Quality in a 21^st Century Trade Agreement”, to be published by Cambridge University Press in summer 2012. It should be a good read on an important subject.

Photo: Timesunion.com

Obama’s Asia Policy and US-China Relations

The more things change, the more they stay the same.

After his first year in office, US President Barack Obama was criticized for neglecting Asia and coddling China. He showed up to APEC with virtually no trade policy, acquiesced to Beijing unnecessarily on several issues, and had a rocky start with US allies and friends like Japan, India and Taiwan. Lee Kuan Yew, one of Asia’s top strategic thinkers, caused a stir when he warned several policy wonks in his 2009 visit that the vacuum of US policy was giving China a free run in the region.

Since then, Mr. Obama has tried to make amends. He has helped Southeast Asian countries stand up to Chinese bullying in the South China Sea, enhanced America’s commitment to regional multilateral forums, and deepened relations with allies and strategic partners such as Indonesia and Vietnam. He has made more waves in his latest voyage across the Pacific, advancing the Trans-Pacific Partnership (TPP) and announcing new US troop deployments in Australia.

And yet the naysayers still aren’t happy. Media hype and Chinese hysteria aside, a host of academics and commentators in the United States and Asia have argued that Mr. Obama’s bold assertion of US interests in the Asia-Pacific alienates a rising China and forces Asian nations to take sides, thereby slowly stirring up the perfect storm that is the next Cold War.

As a student of Cold War history and international relations, it is hard not to fret about China’s rapid military buildup and growing uncertainties about American power. The path to war is arguably paved not only with differing national interests or ideals, but misperceptions, miscalculations and mistrust. And the world is one-for-three in terms of successfully integrating rising powers into the international system without war in the 20^th century: successful in the case of the United States, not so in the cases of Germany and Japan.

And yet the perfect storm forecast by some seems like little more than a storm in a teacup. Mr. Obama is advancing US interests in a strategically important region in ways that are good for the United States and good for the region. A strong troop presence is not just about projecting American power; it allows Washington to help protect sea lanes and assist in humanitarian operations as well as contain Chinese aggression in areas like the South China Sea. Similarly, the TPP not only helps the American economy, but at best advances a platinum FTA standard that addresses critical commercial rules and regulations (such as IP, environment and labor provisions), and at least gives Asian nations a choice between this model and a shallower, China-led one. US foreign policy ought to be based on what is best for the United States and its friends and allies, not what China considers “appropriate”. Beijing must understand that and cannot expect otherwise.

Moreover, perhaps himself aware of Chinese fears, Mr. Obama has gone out of his way to insist that US engagement in the Asia-Pacific is not an attempt to encircle or isolate China. In Australia, he said directly that “the notion that we’re looking to exclude China is mistaken”. He went on to state that Beijing was an important part of setting principles for all actors to follow in the region, that its involvement would be good for the United States, but that Beijing would have to realign its policies just like all other countries in order to pursue common goals in the future.

That doesn’t sound quite like beating the drums of war. It strikes a good balance between advancing a US vision in Asia with countries whose ideals and interests are aligned with America’s, and leaving room for potential Chinese involvement. And it recognizes the fact that since most countries in the region do not want to be forced to pick between Washington and Beijing, advancing an exclusivist agenda in Asia in a domineering way might not be the best idea. Instead, a more prudent approach would be one that focuses on enhancing mutual cooperation with like-minded countries as partners rather than just pawns in a geopolitical chess game.

In terms of actions too Mr. Obama can hardly be seen as having been eager to anger or alienate Beijing. Instead, his administration has moved from initially bending over backwards to reassure Beijing to a more balanced China policy, not because of a sudden desire to contain China, but due to a need to reassure US allies and friends after several displays of Chinese aggression. And even so, despite the rise in tough talk of late, the American president still appears reluctant to anger China on substantive issues like Taiwan, which explains his decision to exclude new F-16s from arms sales to Taiwan in September. The general tone of cooperation has also persisted into 2011, with China itself declaring the meeting between President Hu Jintao and Mr. Obama a huge success with efforts made at building a Sino-American partnership of mutual benefit and mutual respect. Barack Obama is clearly not a president who has ruled out cooperation in favor of conflict thus far, and nor does he seem to want to do so in the future.

This is despite increasingly worrying signals from Beijing about its murky intentions and opaque military capabilities. While details remain undefined, it is clear that China is developing a blue-water navy supported by a wide range of missiles, radars, sensors and torpedoes, including a ballistic missile that could deter US aircraft carrier strike groups critical to defending Washington’s allies. Such a force, as Mr. Lee noted, cannot just be for defensive purposes alone.

Even if one challenges forecasts about Beijing’s capabilities, its intentions have not manifested in reassuring ways either, whether one looks at Chinese aggression in the South China Sea, its rare earth rumble with Japan, or the continuing missile buildup across from Taiwan. Even more troubling, Chinese officials are more interested in pointing out the fact that “China is a big country and other countries are small countries”, rather than appreciating the dynamics of this asymmetry. Smaller countries tend to feel more vulnerable vis-a-vis their larger neighbors, and if they are not adequately assured, they will turn to other larger powers (such as the United States) for help. Indeed, the irony of Asia policy in the Obama administration is that its initial naivete about unrealistic cooperation with China gave way to a more prudent and thoughtful approach toward Asia because of Chinese belligerence and its effects on Beijing’s neighbors.

To the extent that a Cold-War style confrontation between the US and China is likely, avoiding it is a two-way street. The origins of the Cold War arguably lay not only in the structure of the international system and the circumstances of the time, but the perceptions and ideals of US and Soviet policymakers who acted within this context. Conflict was not predetermined.

To avert such a scenario, leaders in Washington and Beijing must continue to pursue cooperation on the multitude of issues on which they agree, assess their own and each other’s capabilities, interests, intentions and actions in a prudent way, and engage in dialogue whenever possible to narrow differences and minimize tensions. Both countries need to balance pursuing their own interests and ideals in Asia while being conscious of how their intentions and actions are perceived by the other, thereby reducing the room for misperception and miscalculation. To his credit, Mr. Obama has done fairly well in this regard. Whether his successors and counterparts in Beijing can do the same remains to be seen.