The last two posts dealt with situations arising in the coming year, but not Asia-Pacific. Two thousand twenty-two rings in the Regional Comprehensive Economic Partnership or RCEP. Maybe, you didn’t notice. A 15 nation trade agreement that will govern trade between 2.3 billion people includes a who’s who in the Asia-Pacific area, including the Peoples Republic of China. The notable exception is the United States. What does this mean for influence in the region?
The RCEP is the successor to the US-sponsored Trans-Pacific Partnership (TPP). Trump withdrew the US from the Treaty, claiming it was unfair upon taking office. Everyone else found it fair and desirable, and they continued without us.
As I have written, this was a high point in the Obama administration handling the China problem. Initially negotiated by then-Secretary of State Hillary Clinton, it promised to bring those threatened by China together to provide alternative supply chains and trading partnerships. The hope was China would feel the pain of exclusion and be encouraged to adhere to trade norms and move towards an open society.
The Trump campaign’s chief economic advisers, Larry Kudlow and Steve Moore, longtime free-traders, backed TPP but could not dissuade the protectionist Trump. It never became a campaign issue because Hillary Clinton strangely abandoned her work rather than defend it. Nor did President Obama mount a rebuttal to Trump. The truth is Democrats beholden to protectionist unions always needed massive Republican votes to pass trade treaties.Continue reading