The new TPP: A way forward

In January 2017, President Donald Trump signed an Executive Order formally ending the United States’ participation in the Trans-Pacific Partnership (TPP), casting doubts as to the future of this long crafted and relevant commercial agreement ever reached in the Asia Pacific region. This decision prompted the need for the 11 remaining members – Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam – to discuss alternatives on how to further proceed with the TPP. Aware of the urgent need to create momentum and provide space for dialogue with the TPP partners, Chile proposed to meet in Viña del Mar in March 2017, on the margins of the High-Level Dialogue on Integration Initiatives for the Asia Pacific.

During this meeting, the members of the TPP agreed to set up a conceptual framework whereby they reiterated their firm commitment to collaborate in keeping markets open and to the free flow of goods, services and investments, advancing regional economic integration and strengthening the rule-based international trading system. Furthermore, they recalled the strategic and economic significance of the TPP, highlighting its principles and high standards as a key driver for promoting economic growth, competition and productivity with the potential of generating jobs and lowering costs for consumers. Hence, Viña del Mar’s meeting was a clear signal that the TPP goals should move forward and also conveyed a sound reply to the winds of protectionism gliding over the international community.

Subsequently, during the APEC Summit in Vietnam the members rebranded the agreement as the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) and after ironing out complex issues, Senior TPP-11 officials reached a final compromise in Tokyo last January.

Consensus-building throughout the negotiation process was not an easy task. TPP countries had to be flexible with regards to several issues in order to balance and to preserve the essentials of the TPP. As a result of that effort, a total of 20 provisions of the original text will be “put on ice,” and others specified in separate documents were to be exchanged among the members at the signing of the agreement.

Finally on the 8th of March the Comprehensive and Progressive Trans-Pacific Partnership was signed by the Trade Ministers of the 11 countries in Santiago. This agreement, representing 13 percent of the world’s GDP and 500 million people, will pave the way to enhance free trade between its members and includes topics such as labor rights, gender equality, environmental protection, e-commerce and competitiveness, among others.

For Chile’s principled orientation and long-standing commitment with free trade, expressed in 26 FTA with 64 countries – including six with ASEAN nations – representing over 85 percent of global GDP and 60 percent of the world’s population, the “resurrected TPP” meant an important contribution to the goal of preserving the largest multilateral free trade agreement ever achieved in the Asia-Pacific zone.

The CPTPP is also good news for the Pacific Alliance countries – Colombia, Chile, México, Peru – one of the most comprehensive integration agreements in Latin America, with 52 observer members and its Associate States – Australia, Canada, New Zealand, Singapore –  to strengthen ties and trade with the world’s most dynamic region.

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(Jose Miguel Capdevila is the Ambassador of Chile.)