Key TPP role could await China

2017-03-13
China Daily

China should not be absent from talks on the Trans-Pacific Partnership this week, since its participation will not only add value to the trade deal but also facilitate domestic reforms and opening-up, experts said on March 12.

Foreign Ministry spokesman Geng Shuang said on March 10 that China is considering attending the meetings, which will be held in Chile on March 14 and 15, after receiving an invitation from the Chilean government.

The withdrawal of the United States from the 12-country trade alignment in January has caused other members to adjust their stance on welcoming China into the group. Some, including Chile and Australia, have been eager to invite China to become a TPP member to enhance the integration of the Asia-Pacific region.

“To meet the TPP demand, China must adopt measures to promote market-oriented reforms at home to diversify its companies’ earning ability, open the market further and improve government supervision,” said Tu Xinquan, a professor at the China Institute for WTO Studies of the University of International Business and Economics in Beijing.

The main themes of the TPP, according to the trade agreement document, are zero tariffs for some countries and discount tariffs for others, investment liberalization, an investor-state dispute settlement mechanism, intervention by member governments in domestic rules and regulations involving companies, as well as social policies including State-owned enterprises and labor standards.

These factors will help member countries increase the level of economic integration and efficiency, according to a report last month by the Beijing-based Center for China and Globalization.

Zhang Wenkui, a researcher at the Development Research Center of the State Council, said TPP membership could lead to combining the TPP and the Regional Comprehensive Economic Partnership, which would end fragmentation in the Asia-Pacific region that undermines economic integration.

“However, if an application to join is filed, negotiations will be long drawn out, similar to the multiple Doha round of negotiations,” he said, referring to global trade negotiations under the World Trade Organization that have emphasized improving the economies of developing countries.

Zhang Yunling, director of international studies at the Chinese Academy of Social Sciences in Beijing, said, “TPP membership may also be practical to help China further secure the channel of foreign direct investment, since the country is inclined toward reform and opening-up.”

Zhang said it would also build closer business ties with countries in the Asia-Pacific region and further reduce the potential for trade friction, especially with major trade partners such as the US.

Meanwhile, Commerce Minister Zhong Shan said on March 11 that he was looking forward to meeting with US Commerce Secretary Wilbur Ross.

“China-US economic and trade cooperation is very much in the interest of both countries,” Zhong said. “A trade war does not meet the fundamental interests of the two countries or the two peoples. It won’t benefit the global economy.”

Last year, trade volume between China and the US reached $519.6 billion－207 times higher than in 1979, when diplomatic relations between the two countries were established.