Let’s Finish the TPP Negotiations Quickly, and Help Evolve Global Trade
Published in Nikkei Press
(Japan) on 16 January 2015
by (link to original)
The economy is a living thing. Technology and transportation, business models, the tides of consumption are always in a state of evolution, and the forward march of globalization, transcending people, things and money will continue whether anyone likes it or not. In order to meet the realities of a changing economy, the framework of our trade must also evolve.
It’s been 20 years since the establishment of the organization that built the global system of free trade, the World Trade Organization. The role its international standards have played in the advancement of the liberalization of trade and the world economy is unfathomable.
However, recently, the terms of the WTO pacts are looking a little dated, and for international law, there are some weak points that are starting to stand out. The reality is the agreements are rife with trade policies that encourage prioritizing one’s own profit without looking back at other nations and loopholes enabling unfair business practices that can’t be regulated under the current system.
Now more than ever, it’s time to revise the rules and reconstruct our trade system. Unfortunately, negotiations in the WTO, which has 150 members comprised of states and territories, are slow-moving. For the time being, all that can be done is widen the net of free trade agreements negotiated by sympathetic nations.
Of those, the plan with the most ambitious objectives is the U.S.-Japan-centered Trans-Pacific Partnership. In supplementing areas in which the WTO agreements are weak — including intellectual property rights, investments, competition policy, government procurements, services, etc. — the TPP has the potential to act as a model for a set of trade rules befitting the 21st century. The pressure is on the U.S. and Japan to show leadership in the construction of this new order.
In light of that, one would think that the U.S. and Japan would share the same determination. It’s pathetic that they’re just getting dragged down by the same old arguments over tariffs, as always. I wish they could take a step back and look at the big picture, and start exhibiting the leadership one would expect from major economic powers. The U.S. and Japan need to conclude their talks quickly and inject a little energy into the flagging negotiations.
Japan’s trade agreement with Australia has officially come into effect. It took over seven long years of negotiations, but the Abe administration and the Australian Abbott administration boldly suppressed their domestic opposition and reached an agreement. This is an example of political leadership striking accord in trade negotiations.
On the other hand, as far as the trilateral talks between China, Japan and South Korea, scheduled to begin in Tokyo this week, are concerned, until now, there has been almost no significant progress. The large-scale economic implications of a China-Japan-South Korea trade liberalization are extremely significant, but none of the involved parties seems to be sincerely interested in reaching an agreement. One cause for the drop in tension is the lengthening of the TPP talks.
Once the TPP takes shape, other trade negotiations — including the China-South Korea-Japan talks — will probably accelerate. Whether or not we will usher in a new era of trade depends on our decisions today.
It’s been 20 years since the establishment of the organization that built the global system of free trade, the World Trade Organization. The role its international standards have played in the advancement of the liberalization of trade and the world economy is unfathomable.
However, recently, the terms of the WTO pacts are looking a little dated, and for international law, there are some weak points that are starting to stand out. The reality is the agreements are rife with trade policies that encourage prioritizing one’s own profit without looking back at other nations and loopholes enabling unfair business practices that can’t be regulated under the current system.
Now more than ever, it’s time to revise the rules and reconstruct our trade system. Unfortunately, negotiations in the WTO, which has 150 members comprised of states and territories, are slow-moving. For the time being, all that can be done is widen the net of free trade agreements negotiated by sympathetic nations.
Of those, the plan with the most ambitious objectives is the U.S.-Japan-centered Trans-Pacific Partnership. In supplementing areas in which the WTO agreements are weak — including intellectual property rights, investments, competition policy, government procurements, services, etc. — the TPP has the potential to act as a model for a set of trade rules befitting the 21st century. The pressure is on the U.S. and Japan to show leadership in the construction of this new order.
In light of that, one would think that the U.S. and Japan would share the same determination. It’s pathetic that they’re just getting dragged down by the same old arguments over tariffs, as always. I wish they could take a step back and look at the big picture, and start exhibiting the leadership one would expect from major economic powers. The U.S. and Japan need to conclude their talks quickly and inject a little energy into the flagging negotiations.
Japan’s trade agreement with Australia has officially come into effect. It took over seven long years of negotiations, but the Abe administration and the Australian Abbott administration boldly suppressed their domestic opposition and reached an agreement. This is an example of political leadership striking accord in trade negotiations.
On the other hand, as far as the trilateral talks between China, Japan and South Korea, scheduled to begin in Tokyo this week, are concerned, until now, there has been almost no significant progress. The large-scale economic implications of a China-Japan-South Korea trade liberalization are extremely significant, but none of the involved parties seems to be sincerely interested in reaching an agreement. One cause for the drop in tension is the lengthening of the TPP talks.
Once the TPP takes shape, other trade negotiations — including the China-South Korea-Japan talks — will probably accelerate. Whether or not we will usher in a new era of trade depends on our decisions today.