By Alison BradleyTwelve Pacific nations are currently negotiating the Trans-Pacific Partnership (TPP), a global trade agreement that President Obama hopes will reconfigure world trade and increase market openness. The total gross domestic product of the TPP parties – Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam – is approximately $27.7 trillion, making up 40 percent of global GDP and one-third of total world trade. China is notably absent from the negotiations, as it did not qualify for the United States’ “high-standard” definition of free trade and open markets.
The U.S. has largely been in the driving seat on this issue, and Obama is currently trying to obtain fast-track authority to win passage of the deal, despite fierce opposition from within his own party, which is under pressure from labor unions not to pass the bill. Currently, 47 House Democrats and 13 Senate Democrats have declared their opposition.
The administration’s pursuit of the TPP is partly a reaction to the ongoing race between the U.S. and China over economic access in overseas markets, and it lays bare the two powers’ competing visions over global governance. It is also a key tactic in President Obama’s strategy to boost exports and drive U.S. economic growth. While U.S. exports have been the fastest growing sector of GDP over the last decade, the TPP would provide U.S. exporters preferential access to important markets in Asia.
Another significant U.S. goal is for the TPP to solidify the current rules of global governance, which were largely established by the United States in the wake of World War II. As China has grown in wealth and power, the United States has become alarmed that it will seek to upend the playing field and redefine how trade and investment flows are governed in Asia. The TPP would lock the participating nations into a system that deepens the current rules on intellectual property, state-owned enterprises, an open Internet, and a limited role for government in the region’s economy.
The Obama administration is hoping to wrap up the TPP negotiations before the summer and bring the 12-country agreement to Congress for ratification before the 2016 presidential election gets firmly underway. It is likely to be a fight until the end and will be decided by a thin margin.