“12 APEC economies reached a framework agreement on the TPP this October. China is open-minded for TPP although it is not involved in the agreement,” said Chinese economic expert Zhang Jianping in an article published on People’s Daily.
As director of the International Cooperation Department from the Foreign Economic Research Institute at China’s National Development and Reform Commission, Zhang put forward four kinds of solutions to form the Free Trade Area of Asia-Pacific (FTAAP).
As the world’s most economically dynamic region, the Asia-Pacific region brings together the world’s top three economies, with lots of members, wide coverage of the population, large economic scale, as well as complex integration mechanism, all of which have attracted the attention of the world. Since the Beijing APEC summit last year, APEC members have made significant progress in promoting regional economic integration and the construction of the FTAAP.
This October, 12 APEC economies reached a framework agreement on the TPP. The TPP set high standards at many fields in the Asia-Pacific region, such as the rules of trade and investment, cross-border services, intellectual property rights, environmental protection and government procurement, which formed a new system of trade and investment rules. China is open-minded for TPP although it is not involved in the agreement.
The Regional Comprehensive Economic Partnership (RCEP) negotiations are also significantly accelerated. 16 economies are negotiating on the formation of basic framework agreement. The RCEP negotiations can embody the development and interest demand of developing economies and emerging economies in a greater degree, which is also crucial for the future of the integration of Asia-Pacific. Both the China-Australia FTA and China-South Korea FTA are expected to take effect in 2016. In addition, the FTA talks between China, Japan and the Republic of Korea (ROK) are also moving forward. The forming and talks of the FTAs mentioned above have a leading role in the future of the forming of FTAAP.
In terms of the way to form FTAAP, there may be four path way. The first one is through TPP, which is welcomed by developed economies. The second one is through RCEP, of which the elasticity and flexibility can be compatible with all the economies, in line with the reality that different economies are at different stages of development. The third one is through the “dual track” model of the fusion of TPP and RCEP, namely that the RCEP and TPP members compromise and negotiate with each other to form a new free trade agreement. The last solution gives consideration to economies not included in the RCEP and TPP, such as Russia, which means all the Asia-Pacific economies need to renegotiate new rules.
It’s really hard to form the FTAAP as it needs to include economies with different stages of development, different cultural backgrounds, extreme variation in economic level and scale. Since the TPP and RCEP have their own emphasis, the combination of the two in the future needs to be given special attention. If the TPP represents the high standard and great degree of liberalization in the western world, reflecting the western wisdom, the RCEP considers more about the practical need of developing economies and makes great efforts to achieve a gradual process of liberalization and facilitation, which fully shows the Oriental wisdom.
If we can combine the wisdom of the East and the West and deeply explore different ways to take into account of the interests and demands of all the Asia-Pacific economies on the basis of the TPP, RCEP and many other bilateral FTAs, it is possible to build a more inclusive, open and fair cooperation platform for the Asia-Pacific region, which can transform competition and confrontation into complementation and cooperation, pushing forward the process of the Asia-Pacific integration and realizing the common dream of the Asia-Pacific. (The Daily Mail – People’s Daily news exchange item)
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