TPP should bolster WTO's role in trade liberalization
Updated: 2015-07-31 08:14
This file photo in February, 2014, shows participants in the Trans-Pacific Partnership negotiations in Singapore. [Photo/IC]
As trade representatives from 12 Pacific Rim countries are hammering out what could be the world's largest free trade area, they should bear in mind the terms to be written in the Trans-Pacific Partnership agreement should not seek to dim the core role of the World Trade Organization in global trade liberalization.
Once signed, the TPP will form an FTA which accounts for nearly 40 percent of global output and has a population of 800 million.
However, the significance of the free trade deal is diminished by the fact that many countries in the TPP framework have already had bilateral FTA arrangements and that the United States and Japan account for about 80 percent of the trade conducted within the potential bloc.
To avoid the possibility of having only a few dominating the future course of the whole bloc, countries participating in the TPP talks should make all efforts they can to craft a mechanism that features equal rights of all members in key decision making. TPP negotiators should also be careful not to grant a few unrestrained power in trade-dispute settlement, or market access issues involving sensitive sectors.
Another key remedy would be to keep the TPP door open, with no discriminatory terms set for newcomers. The TPP has seen its vitality increasing in the past few years only because it constantly brightens up its prospect by assimilating new members.
What's more, some TPP countries take pride in pushing for high standards for the trade blocs. But the problem is that it is not always good for every party to set the bar too high.
The controversy over the length of patent protection is just one example of how one member could opt for a higher standard only because it best suits its own interests. So it is advisable that negotiators who are toiling to maximize gains for their respective countries keep clear-headed.
While it is understandable that countries, frustrated by the long-stalled Doha round of global trade talks, have turned their attention to various initiatives to set up regional FTAs, it is worth noting that the WTO's central role in global trade liberalization should be maintained.
The apparent possible defects aside, the TPP arguably represents so far the closest try to establish an FTA in the geographically vast and culturally diverse Asia-Pacific region, and it offers hope, and possibly wisdom, to revive the Doha round negotiations.