Southeast Asia has become an increasingly important region of global trade in recent years. This trend is due in part to increasing political-economic tension between surrounding states and trade partners (for example the United States and China), but also due to the continual economic growth of the region over the past 20 years. In accordance with the region’s development, several nations are cooperating to facilitate trade treatises with member states of the Association of Southeast Asian Nations. Encompassing over 500 million people within its member states, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is one of the largest and widest-reaching of these agreements.
Who are the main actors in the CPTPP?
The CPTPP is a free-trade-agreement (FTA) comprised of Australia, Chile, Mexico, Japan, Canada, New Zealand, Peru, and several Southeast Asian countries including Malaysia, Singapore, Brunei, and Vietnam. Following the United States’ 2017 withdrawal from the Trans-Pacific Partnership (TPP) the CPTPP was created by the remaining member states in an effort to salvage and reform the agreement without American participation. In March 2018, the CPTPP was signed in Chile by the TPP-11, or the original member states of the TPP. In December 2018, it went into force.
What does the CPTPP entail?
The CPTPP is an FTA with the ultimate goal, like the TPP before it, to “promote economic growth; support the creation and retention of jobs; enhance innovation, productivity and competitiveness; raise living standards; reduce poverty in our countries; and promote transparency, good governance, and enhanced labor and environmental protections” (Department of Foreign Affairs and Trade). One of the key aspects of this FTA is “comprehensive market access” or the elimination of 95 percent of tariffs between member nations. Furthermore, the CPTPP prioritizes improvements in regulatory coherence, competitiveness and business facilitation, commitments towards small and medium-sized enterprises, market development, and government procurement of opportunities for businesses within member states. These priorities encourage the development of liberalized, modern economies and trade within and between nations inside the CPTPP.
Who Is Excluded from the CPTPP?
As of now, large economies absent from the CPTPP include the United States, China, and the United Kingdom. The United Kingdom, China, and Taiwan have formally applied to enter the CPTPP and other nations including South Korea, Colombia, and Thailand have signaled possible interest in joining as well. The US has not publicly expressed any intention of applying. To join the CPTPP, states must undergo an accession process followed by bilateral negotiation between member states and the applicant nation on market access.
Given the historical and political tension between Taiwan and China, their near-simultaneous bids in September 2021 have raised questions for the member states of the agreement on who should be allowed to join and under what name. As of October 2021, China has not compromised on disapproving any interactions or treaties including Taiwan as an independent state and not as part of China. As for the United Kingdom, after applying to the CPTPP in February 2021, the chair of the CPTPP Joint Commission, Japan, accepted the British application which has placed the nation in the accession process stage.
Global Implications
The CPTPP is one of several far-reaching trade agreements instituted in the past five years that are ushering in a new era of Asian economic cooperation and integration that has yet to be seen before. The CPTPP, like many free-trade-agreements, requires open regionalism, or the prohibition of protectionist trade policy towards third party states. This creates an unprecedented level of openness between over 13 percent of global GDP and third party economies that want to pursue trade with member states. On one hand, this trade agreement provides the developing economies of Southeast Asia with more efficient access to massive global markets like that of South America and Northeast Asia. On the other hand, it represents a turning point in global geopolitics, strengthening economic ties between Southeast Asian countries and regional partners.
Ashleigh Edwards is a sophomore majoring in International Studies and Economics at Johns Hopkins University. She is originally from Charleston, West Virginia.
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