Asian Countries to Discuss Trade After US Exit from TPP

Olivier and Mann - Asian Countries to Discuss Trade Agreements After U.S. Exit from TPP

Olivier and Mann – A meeting between representatives from 16 Asian nations will take place in Japan this week with the agenda involving the creation of an Asia-based trade agreement that would challenge the Trans-Pacific Partnership (TPP), which is now made up of 11 nations and recently abandoned by the U.S.

China was not included in the TPP but is playing a major part in the Regional Comprehensive Economic Partnership (RCEP) discussions which are set to last until Friday.

Immediately after taking up the presidency in January, Trump rejected the TPP and the U.S. is not included in the RCEP program.

Both struggling countries and some of the wealthiest countries in Asia make up the membership of RCEP. Agreeing on tax related issues, exchange of services and investment restrictions in key sectors have been some of the hardest issues to overcome since the discussions started four years ago.

Asia is composed of 45 nations and 17 countries in the region are currently members of the RCEP, namely Japan, China, Australia, Brunei, Cambodia, India, Indonesia, South Korea, Laos, Malaysia, Myanmar, New Zealand, Philippines, Singapore, Thailand, and Vietnam.

Japan’s Shinzo Abe and some leading TPP member nations are still hoping that Trump will reconsider his stance on TPP, which was America’s central trade program in the region during the Obama administration.

Trump has previously expressed his preference for having bilateral agreements and has also vowed to renegotiate the North American Free Trade Agreement (NAFTA) and implement a border tax to force American businesses and producers back to the U.S.

Trump’s initiative has increased concerns in Asia where the majority of countries have benefited from more relaxed trade and the development of the worldwide supply network. Countries belonging to the RCEP provided almost 20% of the U.S. imports last year with China contributing half of that volume.