An online magazine of news and opinions from the Asia New Zealand Foundation
Asia's take on the TPP
The Trans-Pacific Partnership (TPP) is a Pacific Rim trade agreement that includes five Asian countries – Japan, Malaysia, Vietnam, Singapore and Brunei.
Korea, Thailand, Indonesia and the Philippines have also indicated they intend to join.
Other negotiations have been taking place in Asia around another trade agreement: the Regional Comprehensive Economic Partnership, or RCEP. Asian giants China and India are also involved in these negotiations, which are centred around the Association of Southeast Asian Nations (ASEAN) and also involves New Zealand and Australia.
According to a World Bank analysis, the biggest winner from the Trans-Pacific Partnership is likely to be Vietnam. Its low wage economy relies on exports; its garment industry in particular is expected to benefit.
At a speech to the Vietnam-New Zealand Business Forum on the TPP this week, Trade Minister Todd McClay said Vietnam had been New Zealand’s fastest growing trading partner in Southeast Asia over the past five years.
In Japan, the lowering of agricultural tariffs has been a sensitive topic. This article outlines the possible implications for Japanese rice farmers and exporters.
Meanwhile, Japan’s Economy Minister Akira Amari, the chief TPP negotiator for that country, resigned amid corruption allegations, and was replaced by Nobuteru Ishihara.
Malaysia has experienced public protests around the agreement, amid concerns the TPP could undermine control of its economy and its affirmative action policies for “bumiputra” (ethnic Malays and other indigenous people).
- The Strait Times website article - Crowd gathers at Kuala Lumpur's Merdeka Square for anti-TPP rally
Malaysia’s upper house approved the country’s participation in late January. Malaysian government news agency Bernama outlines the potential economic benefits to the country in its article 12 signatures and a new trade deal - TPPA
However, opponents continue to call for the country’s involvement to be reconsidered as expressed in an opinion piece in the Star Times Online.
Asian countries that have not joined the TPP
Among the Asian countries that have not joined the agreement, South Korean President Park Geun-hye has expressed her desire for the country to eventually become a signatory, describing Korea as “natural partner". South Korea is likely to be one of the first countries to be added to an expanded agreement.
Taiwan is also pushing to be included in the second round.
In India, trade minister Nirmala Sitharaman has warned of potential adverse impacts to the country’s economy as a result of it not being a party to the agreement. She says the government is looking at structural changes to the economy to reduce the impact.
- The Economic Times website article - Mega-trade pact TPP to certainly impacts exports: Nirmala Sitharaman
Fran O’Sullivan writes in the New Zealand Herald that China is being “kept in the loop” with TPP briefings. Chinese economists have previously said the agreement won’t isolate China.
Thailand is another country that hasn’t yet joined the agreement, though it has expressed interest, and is being encouraged to do so by Japanese investors.
Indonesia has indicated it plans to join but has expressed concerns about the potential impact on state-owned enterprises, with President Joko "Jokowi" Widodo coming out strongly in favour of joining the trade agreement.
The Philippines will need make changes to its constitution before it can join the TPP due to laws governing foreign ownership restrictions.