Opinion: Will the U.S. reap what it sows on TPP rejection?

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Dave Dickey

It’s called the Regional Comprehensive Economic Partnership (RCEP) — a free trade agreement among 16 nations in Australia, China, India (yes THAT India), Japan, South Korea and New Zealand that began  negotiations in 2013.

And now that the Trans-Pacific Partnership is deader than the Wicked Witch of the West, China would like nothing better than to gain control of Pacific Rim trade by forging a deal with spurned TPP nations.

China did not join the TPP party, in part because it would have had problems meeting the deal’s labor, food safety and environmental rules, not to mention losing the Communist Party’s iron grip on internet access and information.

But anyone paying attention to trade issues will know that since 2000, China has increased its trading partnerships in Asia-Pacific markets, often to the detriment to American exports.

In case you were wondering. every single TPP member nation is on that list.

Meanwhile, as of November, the U.S. trade deficit with China sits at more than $305 billion.

The TPP was supposed to fix both those financial trade woes.

But now China is mostly unencumbered (there is some movement from TPP nations led by Australia to push a TPP-minus-one deal) to pursue RCEP with greater vigor.

By the way, Australia is also hedging its bets on RCEP, in what must be viewed as a pragmatic understand of the power of the multi-nation trade deal.

And so, China is looking to jump-start a deal without the U.S.

With TPP out of the picture, it becomes the only regional game in town.

And when China is the driving force in writing particulars of the deal, those worrisome issues of food safety and labor become not so important.

Here’s the thing.

The Trump administration can rightly talk about how China has out-traded the U.S. for years – but bilateral deals simply won’t have the strategic force and impact of the scorned TPP deal.

White House National Trade Council Director Peter Navarro told Fox News in late January that the U.S. will pursue bilateral deals with Japan, New Zealand, Malaysia, Thailand and Australia.

Navarro claims that the U.S. needs to strike bilateral trade deals to avoid surrender of U.S. sovereignty.

All fine and good.

But if RCEP becomes a reality, the deal will cover some 3 billion people and oh-by-the-way cover nations that are responsible for a whopping 40 percent of world trade.

That’s roughly $17 trillion in gross domestic product.

Yes, from what we can gather, RCEP offers relative small tariff concessions – certainly nothing on the scope of the TPP.

And yes, actually getting RCEP negotiators to find the Goldilocks-sweet-spot-that-everyone-can-sign-on-to will be difficult.

But the fact that China is in a position to try to re-start RCEP should be worrisome to U.S. agriculture.

The U.S. administration needs to articulate with expediency their vision to Asia-Pacific markets.

Without a clearly defined TPP alternative, China is more than happy to fill the void.


About Dave Dickey

Dickey spent nearly 30 years at University of Illinois at Urbana-Champaign’s NPR member station WILL-AM 580 where he won a dozen Associated Press awards for his reporting. For the past 13 years, he directed Illinois Public Media’s agriculture programming. His weekly column for Big Ag Watch covers agriculture and related issues including politics, government, environment and labor. Email him at dave.dickey@investigatemidwest.org.

This column reflects the writer’s own opinions and not those of Big Ag Watch.

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