The biggest trade deal in history was signed Thursday, yoking 12 Pacific rim countries in a US-led initiative aimed at wresting influence from booming China.
The biggest trade deal in history was signed Thursday, yoking 12 Pacific rim countries in a US-led initiative aimed at wresting influence from booming China.
The ambitious Trans Pacific Partnership (TPP) aims to slash tariffs and trade barriers for an enormous 36 per cent of the global economy — but pointedly does not include Beijing. “TPP allows America — and not countries like China — to write the rules of the road in the 21st century,” US President Barack Obama said after the pact was signed in New Zealand.
The deal — whose birth was fraught by domestic opposition in the US and in other key players, such as Japan — is a key plank of Mr Obama’s so-called “pivot” to Asia, as he seeks to counter the rising power of China.
Along with a rebalancing of the US military machine towards the western Pacific, the TPP is recognition of the growing might of China, which has come to dominate the region, threatening American influence.
Supporters of the deal say harnessing the power of free trade in such a dynamic part of the world is vital if the US is to fend off China’s challenge to its supremacy. Trade ministers from 12 participating countries — Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam — signed the pact in Auckland on Thursday.
Beijing was muted in its reaction to the deal, saying its officials were studying the 6,000-page document.
A commerce ministry statement said China would “actively participate in and facilitate highly transparent, open and inclusive free trade arrangements in the region”.
In Auckland, US trade representative Michael Froman, however, said the agreement was “never dir-ected against” any specific country and “it’s important to have a constructive economic relationship” with China.
