The RCEP idea was born in November 2012 at an ASEAN summit in Cambodia. There have been nine rounds of negotiations so far. Curiously, the initial idea came from Japan -- as a mechanism to combine the plethora of bilateral deals ASEAN has struck with its partners. But now China is in the lead.
And if the TPP vs. RCEP competition was not enough, there's still the Free Trade Area of the Asia-Pacific (FTAAP). That was introduced at the APEC meeting in Beijing late last year by -- of course -- China, to seduce nations whose top trade partner is China anyway from entertaining TPP notions.
Joseph Purigannan of Foreign Policy in Focus has aptly summarized all this frenzy; "If we connect all these developments of 'mega-FTAs,' what we are seeing is actually the intensification of what we can call a turf war among the big players." So, once again, this is a China vs. US proxy war.
Big Pharma rules
TPP is spun in the US as aiming at setting common standards for nearly half of the word economy.
And yet TPP -- negotiated in utmost secret by hefty corporate lobbies with absolutely no public scrutiny -- is essentially NATO on trade (and a close companion of the EU-targeted TTIP). TPP has been developed as the economic/trade arm of the "pivoting to Asia" -- with two inbuilt wet dreams; excluding China and diluting the influence of Japan. And most of all, TPP aims at preventing most of Asia -- and inside it, ASEAN nations -- from reaching any agreement that does not include the US.
China's reaction is subtle, not frontal. Beijing is betting in fact on multiplying agreements -- from RCEP to FTAA. The ultimate objective is to reduce the hegemony of the US dollar (don't forget: TPP is dollar-based).
Even after securing US Congress approval last month for a fast track leading to a deal, President Obama and the all-powerful TPP business lobby is having a very hard time convincing the 12 TPP -- very unequal -- partners.
On next generation biological drugs, for instance, TPP privileges Big Pharma such as Pfizer and Japan's Takeda. TPP goes against state-owned enterprises -- very important in economies such as Singapore, Malaysia and Vietnam -- to the benefit of foreign competitors fighting for government contracts.
TPP wants to get rid of Malaysia's preferential treatment to ethnic Malays on business, housing, education and government contracts -- a staple of Malaysia's development model.
Under the pretext of cutting tariffs on "sensitive" clothing, big US textile corporations such as Unifil aim to stop Vietnam from selling cheap clothing made in China in the US market.
And the US and Japan remain at serious odds on agriculture and the automobile industry, still debating, for instance, when a vehicle has enough local content to qualify for duty-free.
General Prime Minister Prayut Chan-ocha is convinced that TPP can make or break Thailand -- with an emphasis on "break." That's what he told an imposing visiting group of the US-ASEAN Business Council.
Bangkok is terrified that its laws on patent medicine -- as in the right to produce generic medicine -- will be replaced by mega-restrictive patent laws dictated by the usual suspects: Big Pharma.
One Belt, One Road, one bank
In the end, it all comes back to Chinese President Xi Jinping's by now legendary I Tai I Lu ("One Belt, One Road"); a.k.a. the New Silk Road(s) strategy, where one of the key components is the export of all manner of Chinese connectivity technology to other ASEAN nations.
(Note: You can view every article as one long page if you sign up as an Advocate Member, or higher).
2
1
1
