CPTPP is good for Malaysia

March 22, 2018

CPTPP is good for Malaysia


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Malaysia’s MITI Minister Dato’Mustap Mohamed

THE Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the rebranded TPPA, was finally signed by 11 countries on March 8.

The pact had earlier raised anxiety among certain parties that it would jeopardise Malaysia’s sovereignty and undermine the well-being of its citizens. But if we look at the bigger picture, the pact will benefit the country in the long run because our economy depends largely on trade activities.

According to Moody’s last week, Malaysia would be the biggest winner from the deal as the CPTPP covers a market of nearly 500 million despite the absence of the United States.

This fact was reinforced by the Peterson Institute for International Economics’ (PIIE) research, which showed that the CPTPP would benefit palm oil, rubber and electronics exporters like Malaysia with export access to new markets including Canada, Peru and Mexico.

Looking at current data by the Malaysia External Trade Develop­ment Corporation (Matrade), Malaysia’s dependence on trade is undeniable, recording RM935.39bil in exports last year and RM838.14bil in imports. Malaysia enjoyed a trade surplus of RM97.28bil.

The electrical and electronics sector remains the top exporter accounting for 36.7% while palm oil products stood at 5.8%. Malaysia is also currently the largest producer of gloves, controlling almost 65% of the world market.

In view of this, the CPTPP will encourage existing manufacturers to expand as it provides access to new or untapped markets. It will indirectly reduce our reliance on the US market as well.

Ahmad Shahir Abdul AzizUniversiti Sains Malaysia

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READ: http://www.ipsnews.net/2018/02/model-trade-deal-con –by Dr Kwame Jomo Sundaram

Trade outcome vital to success of ASEAN Summit

March 18, 2018

Trade outcome vital to success of ASEAN Summit

by Mari Pangestu and Peter Drysdale

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Economists Dr Mari Elka Pangestu (above) and Dr. Peter Drysdale

Australia has been an ASEAN dialogue partner since 1974, an acknowledgement of the centrality of ASEAN to Australia’s regional security. There have been ASEAN summits with Japan, China, the United States and India but the ASEAN summit in Sydney this weekend is the first in Australia.

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The Host, ASEAN-Australia Special Summit 2018, Prime Minister Malcolm Turnbull

The summit comes at a time when leaders in ASEAN and Australia confront a number of strategic choices. None is more important than how they respond to the threat to the global trading system, the foundation of East Asia’s prosperity and a critical element in its security.

ASEAN centrality has been an organising framework for Asian economic policy cooperation over the past half century.

The retreat of the United States under President Trump from leading the global economic order; the rise of China with its assertive stance on the South China Sea and its infrastructure development ‘carrot’ in the Belt and Road Initiative; a putative ‘Quad’ configuration of Indo-Pacific power around the US, India, Japan and Australia; and the North Korea crisis all present significant challenges to ASEAN’s central role in the region.

Last week, Mr Trump fired the first shots in what could become a global trade war with the imposition of 25 per cent tariffs on steel imports and 10 per cent tariffs on aluminium. The action, taken under the Section 232 national security provisions of US trade law, risks provoking tit-for-tat retaliation by trading partners who, unlike Canada, Mexico and Australia, aren’t able to negotiate exemption from its impact. It also risks the WTO rules-based trading system.

Mounting uncertainty has affected confidence in trade and economic recovery since Trump translated his campaign protectionist rhetoric into an ‘America First’ agenda. But the White House announcement last week threw the international system into chaos. If Trump’s imposition of these tariffs on a flimsy national security pretext does not outright flout the rules of the WTO, then it at least flouts its widely shared norms.

The response from the European Commission was to ‘do the same stupid things to respond to stupid things’ — promising retaliatory tariffs on a range of US exports into Europe, from Harley-Davidson motor bikes to bourbon whisky. The tariff imposts also launched a process in which partners like Australia successfully begged exemption on various grounds both sound and spurious, all of which are in clear violation of the understanding that trade will be conducted under internationally agreed rules, not ad hoc bilateral deals. That’s the beginning of the rot; it may be a short-term tactical victory for countries like Australia, but it is not effective trade policy strategy.

What can be done now?

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Australia’s Prime Minister Malcolm Turnbull (R) waves with ASEAN leaders (L to 2nd R) Laos’ Prime Minister Thongloun Sisoulith, Indonesia’s President Joko Widodo, Cambodia’s Prime Minister Hun Sen, Brunei’s Sultan Hassanal Bolkiah and Thailand’s Prime Minister Prayuth Chan-O-Cha for a family picture at the ASEAN-Australia Special Summit in Sydney on March 17, 2018.

The strategic objective is to keep the WTO system alive in the face of a potentially mortal threat. The United States is playing itself out of the system. Learning to live without the United States as a rules- and norms-enforcer won’t be easy, but it is the only response that will protect the system and avoid the large-scale economic cost and the dangerous political consequences of an escalating trade war.

Asia’s response to the Trump trade threat is critical for the international system. Asia’s prosperity and political stability depends critically on its integration into the global economy through the rules-based trading system which has underpinned the growth of Asian interdependence, Asia’s economic prosperity and its political security.

China is in Trump’s cross hairs as ‘the cause of US trade deficits because of its violation of trade rules’. But China is also a crucial stakeholder in the rules-based system through its largely faithful observance of the protocols of its accession to the WTO in 2001 and the huge trade in Asia and around the world that has been built on that.

Locking in China’s entrenchment to the WTO system — and resistance to the temptation to take retaliatory actions in the face of Mr Trump’s trade antics — is thus a major element in the system’s defence.

As China and the US stare each other down with a potentially devastating trade war on the horizon, it may seem strange to turn to ASEAN, but it has a central role in the collective response to Asia’s present predicament. That is because of ASEAN leadership in the strategic conception and negotiation of the Regional Comprehensive Economic Partnership (RCEP) in East Asia.

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RCEP includes not only the ten ASEAN economies but also Japan, South Korea, China, India, Australia and New Zealand. It’s a coalition of countries with the economic weight to deliver a powerful message to the world. The signing of the Trans-Pacific Partnership agreement without the United States in Chile last week was a start in defence of the global trading system. But that agreement doesn’t include China or most of ASEAN and is not systemically important enough to make the difference. RCEP is.

The threat to the multilateral trading system is more important than the still unfinished business on the Korean peninsula and worries about the South China Sea.

ASEAN, with Indonesia at its core, is a regional enterprise with a distinctly global outlook and objectives. Intra-regional trade is only 24 per cent of ASEAN’s total trade but it is deeply integrated into trade globally.

The Australia–ASEAN summit is a singularly important opportunity for setting out strategic interests in these economic dimensions of regional security and ASEAN’s role in achieving them. A declaration from the Sydney summit that commits to avoiding retaliation to US protectionism and elevating the momentum in RCEP will help cement a broader coalition of Asian economies, including China, Japan, South Korea and India, to holding firm on the international trading system.

It will also ensure ASEAN’s continuing centrality in cooperation across the region.

Dr. Mari Pangestu is former Indonesian Trade Minister and Professor at the University of Indonesia. Dr. Peter Drysdale is Professor of Economics and Head of the Asian Bureau of Economic Research and Co-Editor of East Asia Forum in the Crawford School of Public Policy at the ANU. This article was also published in the Australian Financial Review on 15 March 2018.


Trade is the Republican Party’s last stand

March 12, 2018

Trade is the Republican Party’s last stand

by Dr. Fareed Zakaria


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The tussle over tariffs is the most significant political battle taking place in America right now – much broader than a dispute over steel and aluminum imports. It is the Republican Party’s last stand against a total takeover by Donald Trump. Having ceded ground to the President on everything from personal character to immigration to entitlement reform, Republican leaders have chosen to draw the line at free trade. If they get rolled on this, Trump will have completed the transformation of the party.

“From Adam Smith to Milton Friedman, every great theorist of capitalism has recognized that free trade is at the heart of what makes capitalism work. And they have all pointed out that tariffs are precisely the kind of government intervention – with the state choosing which industries to favor, which companies to reward – that produces inefficiency and corruption. But Republicans are now comfortable with government intervention, as long as it’s for the right people”.–Dr. Fareed Zakaria

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In recent weeks, Trump seems to have remembered that he is a populist or at least is playing one on TV. After campaigning as the tribune of the forgotten working class, he handed over his presidency to the establishment wing of the Republican Party, which proceeded to attack Obamacare, roll back regulations and pass a huge tax cut for companies and wealthy Americans. But perhaps to shore up his base before the midterm elections, or because he does actually believe some of his own rhetoric, he is now moving hard on tariffs – and also immigration.

As is often the case, Trump is more in line with his party’s base than most of its leaders. A recent Quinnipiac University poll finds that voters, like the Republican establishment, overwhelmingly oppose Trump’s tariffs. But most Republican voters support them. In fact, over the last decade, Republican support for free trade has dropped a staggering 20 points (while Democratic support has risen by 15). This is one of the sharpest reversals on major public policy recorded in recent history.

The new Republican Party is coming into view. It is a party skeptical about free markets. It is important to remember that it is not really possible to be in favor of capitalism and against free trade. From Adam Smith to Milton Friedman, every great theorist of capitalism has recognized that free trade is at the heart of what makes capitalism work. And they have all pointed out that tariffs are precisely the kind of government intervention – with the state choosing which industries to favor, which companies to reward – that produces inefficiency and corruption. But Republicans are now comfortable with government intervention, as long as it’s for the right people.

It is also now a party that has developed a contempt for experts and expert analysis. In 1980, with liberalism ideologically smug and dominant, Democratic Sen. Daniel Patrick Moynihan remarked that all the new and interesting policy ideas were coming from people like William F. Buckley and Irving Kristol on the right. Today, the Republican Party is led intellectually by the likes of Sean Hannity and Rush Limbaugh.

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Consider that Trump’s tariffs are opposed by a remarkable array of scholars across the political spectrum, from the conservative Heritage Foundation to the libertarian Cato Institute to the center-left Brookings Institution to the left-wing Center for Economic and Policy Research. The White House barely offers serious arguments, instead providing a bogus justification for the tariffs, national security, even though China and Russia supply only a small portion of these goods to the U.S.

Despite research showing that previous protectionist policies have failed, that the steel industry has lost more jobs due to efficiency and automation than to trade, and that preserving one job in the steel or automobile industries through tariffs costs consumers a whopping $1.5 million, administration supporters no longer even offer a response. The data is simply dismissed as partisan spin or fake news.

Finally, the GOP is being transformed into a party that is hostile to foreigners and foreign countries. Under Ronald Reagan, the Republicans were the party of a generous immigration policy, strong alliances and faith in the advancement of democracy around the world.

Today, the party’s base doesn’t like foreigners or foreign countries. Even traditional allies like the Europeans are increasingly viewed with suspicion. It is bizarre to have chosen tariffs that mostly threaten American allies like Canada, the E.U., South Korea and Mexico. Trade does produce disruptions, especially severe ones in recent decades. The most sensible, cost-effective way to deal with them would be to provide subsidies to workers who lose their jobs because of trade, and invest in large scale retraining efforts. But that doesn’t quite have the bite that attacking foreigners and stoking trade conflict does.

Having transformed the party’s views on issues as diverse as immigration, fiscal discipline, foreign policy and law enforcement, if Trump wins the battle over trade with his party, he will have won the war. The Republican Party will be history. And given his long-demonstrated preferences in this regard, who knows, he will probably want to rename it the Trump Party.

Fareed Zakaria is published weekly by THE DAILY STAR.

A version of this article appeared in the print edition of The Daily Star on March 12, 2018, on page 7.

Trans-Pacific Partnership (CPTPP): Japan-led Pacific Rim Countries Desperate to appease Trump

March 9, 2018

Trans-Pacific Partnership (CPTPP): Japan-led Pacific Rim Countries Desperate to appease Trump

by Jomo Kwame Sundaram


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Dr. Jomo Kwame Sundaram  seen with Khazanah Nasional Berhad’s Tan Sri Azman Mokhtar

The grandiose sounding Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will be signed in Santiago de Chile today, 8 March. Instead of doing something to advance the condition of women on International Women’s Day, trade representatives from 11 Pacific rim countries will sign the CPTPP, which some critics argue will further set back the progress of humanity, including women who hold up ‘half the sky’.

In fact, the resulting 6500 page agreement has, so far, only been used by Obama’s United States Trade Representative (USTR) to derail the already protracted Doha ‘Development’ Round negotiations under the auspices of the World Trade Organization (WTO), e.g., by ‘lame-duck’ USTR Michael Froman at the WTO ministerial in Nairobi in December 2016.

In January last year, newly elected US President Donald Trump withdrew from TPP, effectively killing the agreement. Since then, Japan has worked hard to keep it alive, with discreet help from Australia and others. Apparently, they hope to draw the US back in order to check China’s growing influence in the region while delaying other regional trade negotiations such as the Regional Comprehensive Economic Partnership (RCEP).

After signing it, at least six countries must ratify the CPTPP for the deal to come into effect. Even before signing, governments have announced plans to drag their feet, indicating they are signing under duress. Incredibly, no details of the new agreement were supposed to be released until after the signing, and few consultations have been held by the signing governments despite promises to do so.

Bad deal not improved by reheating

To make the case for the TPP, its advocates greatly exaggerated its negligible trade benefits. US government studies — by the Department of Agriculture’s Economic Research Service and the International Trade Council — projected very modest gains, even with the US in.

Despite the US absence from the CPTPP, its proponents have not hesitated to make even more exaggerated claims about supposed benefits. With already negligible trade gains from the original TPP, purported gains from the CPTPP without the US are even more paltry. Not surprisingly, the TPP11 have become even more desperate for US participation to maintain their original fictitious claims.

The old claim that trade liberalization lifts all boats is increasingly rejected in favour of more nuanced recognition that its costs may be as much as its benefits, and distributed very unevenly. Such recognition has enabled better understanding of the Brexit referendum outcome and Trump’s election following a campaign in which all major candidates were opposed to the TPP.

CPTPP losses, costs and risks are almost as great as with the TPP while actual gains are even more trivial. Meanwhile, CPTPP citizens must surely wonder why their governments are proceeding so secretively without public consultation or even the fig leaf of credible cost-benefit or other analyses.

Seducing Trump

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Japan’s Prime Minister Abe appeasing US President Donald Trump

Minor amendments have been made to the original TPP agreement, largely drafted by US corporations during the Obama presidency. But the new CPTPP Preamble can only guide its interpretation, and does not replace problematic TPP provisions. Some TPP11 countries have secured ‘side letters’, exempting them from some of its provisions.

Meanwhile, several onerous provisions have been suspended, including some of those extending the scope and duration of pharmaceutical patents. Well over a thousand provisions remain, most not even challenged by the CPTPP negotiators. The 22 suspended provisions can easily be restored if the US chooses to rejoin the TPP.

At his World Economic Forum charm offensive at Davos in January, Trump stated that he “would do TPP if we were able to make a substantially better deal” despite his anti-TPP presidential campaign and post-election rhetoric. No one can be sure what he means anymore, especially following his more recent declarations celebrating trade warfare.

US positions in the ongoing North American Free Trade Area (NAFTA) re-negotiations suggest his administration will demand stronger intellectual property rights, especially pharmaceutical patent protection; this can be easily accommodated by the TPP11 by reinstating suspended TPP provisions.

However, in light of the new USTR’s pronouncements, it is likely that the White House will insist on removing ISDS provisions from the TPP to be consistent with Trump’s ‘sovereigntist’ approach of putting ‘America first’. Or worse, ISDS provisions may not be reciprocal, i.e., US corporations abroad can use ISDS, but TPP11 investors cannot make such claims against the US government.


Donald Trump: King of Chaos

March 6, 2018

Trump: King of Chaos

by Charles M. Blow


That seemed to be the descriptor most tossed around last week to capture the circus around Donald Trump.

But I think chaos is the fruit of this poison tree, not the root of it. That is to say that I don’t believe that Trump desires chaos because he feels most at peace when the world around him is experiencing pandemonium.

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Believing anything Trump says is a recipe for a headache and heartache. The old rules no longer apply. We see the world as through a window — as it is, even if we are a bit removed from the whole of it. Trump sees it as if in a house of mirrors — everything reflecting some distorted version of him. His reality always seems to return to a kind of delusional narcissism.–Charles M. Blow

Rather, I believe that this chaos is the perpetual result of the absolute incompetence and idiocy of a preening philistine who has faked his way through life pretending that he knows more than he does and is tougher than he is. He has two diametrically opposed impulses.

On the one hand, he latches on to outlandish ideas, or simple, emotional aspects of complicated issues, or conspiratorial drivel, and he vests the whole of his emotional energy into proving their veracity, often against overwhelming evidence to the contrary. President Obama wasn’t born in America. Obama used the F.B.I. to spy on him. There were good people on both sides in Charlottesville. The “fake news media” is the enemy of the American people. The whole Russia investigation is a hoax. He’s doing a good job as President.

On the other hand, and with other issues, his convictions are not fixed at all, but ephemeral and fleeting, changing from moment to moment, like the pattern of fog on a glass.

This is when you can see that he is clearly faking it. He wants so desperately to be right that he says whatever his audience — whether that be a small group or a filled arena, whether that be members of Congress or fans at a rally — want to hear and will respond to.

This is how you can get wildly vacillating positions and bold, empty promises in bipartisan meetings with the man — whether those meetings are about addressing DACA and immigration or about addressing gun control after the school shooting in Florida.

And one thing that clearly comes across in those meetings is how much he talks rather than listens. It’s all about what he believes, what he would do, how courageous he is, how conciliatory he is, how smart he is about the subject.

That is precisely how you know that none of it is true, and that he is simply stringing together a jumble of words into conflicting ideas. You see a fear of being exposed as an idiot and fraud. As Friedrich Nietzsche once put it: “Talking much about oneself can also be a means to conceal oneself.”

So Trump simply bulldozes his way through, boasting and bragging, distracting and dissembling, making promises without making sense.

People used to dealing with a sane, logical person who generally doesn’t lie and generally makes sense are left scratching their heads, wondering whether to believe what they have heard, whether to make plans and policies around it.

Believing anything Trump says is a recipe for a headache and heartache. The old rules no longer apply. We see the world as through a window — as it is, even if we are a bit removed from the whole of it. Trump sees it as if in a house of mirrors — everything reflecting some distorted version of him. His reality always seems to return to a kind of delusional narcissism.

The only way that a person can live out a life in this fashion is to be a liar and a fraud. That’s why the majority of Americans find him unlikable and unfit. Character still matters.

The great danger in all of this is that a man who knows little but is pretending to know much can easily be manipulated by those who know more.

For instance, according to The New York Times, leading up to Trump’s hurriedly announcing his potentially disastrous steel and aluminum tariffs:

“Supporters of the tariffs have begun broadcasting televised ads in recent days during programs that Mr. Trump has been known to watch. One such ad ran on Fox News minutes before the President’s Twitter post on Thursday morning.”

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He made the move against the advice of his own Director of the National Economic Council, Gary Cohn, and his Defense Secretary, Jim Mattis.

As is Trump’s wont, he doubled down defending his hasty decision by trying to render something fraught and nuanced as simple and easy.

He tweeted Friday, at 5:50 a.m. no less, that “trade wars are good, and easy to win.” Only a simpleton with no true comprehension of global trade systems would say such a thing. And he did.

As is the case most often with this man, the subjects aren’t simple, but his understanding is.

It is this constant attempt to render the big things small and to make his limited knowledge and ability appear not only sufficient but extraordinary, that leads to Trump’s constant state of chaos.

Trump keeps trying to bend the world to meet him, rather than rising to meet the world. That has never worked and never will. It only compounds the chaos.


Moving from Defence to Offence on Trade Strategy

March 5, 2018

Moving from Defence to Offence on Trade Strategy

Author: Editorial Board, East Asia Forum

Image result for Trump declares a trade war  Commerce Secretary Wilbur Ross with his Boss,President Donald Trump


The trade architecture in East Asia — the most dynamic region in the global economy — is up for grabs. The very system on which regional arrangements are built is under threat.

US President Donald Trump’s withdrawing the United States from the Trans-Pacific Partnership (TPP), his ‘America First’ agenda and his declaration last week of the first shots in a global trade war undermine the WTO and the global rules-based economic system that it underpins. Asia and the global community, including the United States, have relied upon and benefitted from that system for over 70 years.

Can East Asia put aside its differences and define a set of arrangements that protect its own economic security interests absent the United States? US leadership put this system in place and drove its expansion throughout the post-war years. Now the United States is generating the headwinds that threaten to unravel it. Just last week Trump announced the first salvo in what could be a trade war with a 25 per cent tariff on all steel imports and 10 per cent tariff on aluminium imports. The temptation for other countries is to retaliate with their own self-harm policies.

What’s at stake?

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The multilateral trade regime provides the cement and ballast that makes it easier to manage tricky rivalries and conflictual relationships of the kind that abound in Asia but around which large-scale economic interdependence and prosperity have been built. The ‘America First’ challenge threatens the collapse of that system and a descent into beggar-thy-neighbour protectionism and political conflict reminiscent of the lead-up to World War II.

How leaders in Asia respond to this challenge and the arrangements that the region settles on will matter for three important reasons. It will substantially affect the welfare of individual countries and the communities within them. It will affect the atmosphere for both economic and political cooperation in the region. And, given the size of the Asian economy, it will matter for whether the global rules-based economic system withstands the assault upon it.

No single country  acting on its own can lead a response to the vacuum that United States is daily creating in global governance. This US-sized hole in the Asia Pacific will have to be filled with leadership from the rest of the region as a whole.

Asian and Pacific nations have responded definitively so far. And leadership has come from one of the most unexpected places: Japan, traditionally shy to step out in front.

Once Trump declared that the United States was getting out of the TPP, Japan led the remaining 11 members towards the agreement’s conclusion without the United States. That deal is expected to be signed in Chile this week. The awkwardly named Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), otherwise known as TPP-11, would not have happened were it not for Prime Minister Shinzo Abe’s leadership. Australia’s also played a major role, but Japan (the Partnership’s largest economy absent the United States) was the decisive player.

As Shiro Armstrong explains in this week’s lead essay, ‘conclusion of the CPTPP does not deliver the big strategic goal of keeping the United States entrenched in Asia. Instead, it sends to Mr Trump a strong message of the region’s commitment to openness. Holding the line and pushing back against growing protectionist sentiment keeps the pressure up, with market opening and reform on which US businesses and consumers miss out’.

Most surprised about Japanese leadership are the Japanese themselves. As Armstrong says, Japan ‘has found itself in an unusual position. Japan has often relied on external pressure, usually from the United States, to advance its diplomatic goals and even to push domestic reforms’.

Asia cannot count on Japanese leadership alone, nor can it count on Japan’s continuing in this manner. In saving what’s left of the TPP, Mr Abe saw an opportunity to hedge ‘against the uncertainties that Trump has generated in regional and global trade policy, strengthening ties with other partners like Australia and India and laying the groundwork for improving relations with China’.

Australia almost single-handedly led the push back against Trump’s team  tearing up multilateralism as APEC’s central tenet at the summit in Vietnam last November.

With Australia having held the line in APEC and moved forward on the TPP, what is needed now is for the other powers in Asia to join Australia and Japan in preserving and protecting the global system.

The CPTPP, even if it expands membership to include other middle powers in East Asia, is not systemically important enough to do the job. With the United States in the agreement, the TPP would have accounted for 38 per cent of the global economy but without it the agreement accounts for only 13 per cent.

In East Asia, there is fortunately another vehicle that has the weight to do the job. The Regional Comprehensive Economic Partnership (RCEP), which is currently being negotiated, involves the 10 ASEAN members plus Australia, China, India, Japan, New Zealand and South Korea. That grouping accounts for 31 per cent of global economy.

RCEP (perhaps the second-worst acronym in Asia after the CPTPP) is as important as it is difficult to realise with the required ambition. Including the major economies of Indonesia, India and China makes a tall order out of large and credible commitments to economic opening . The anxiety to get a deal done quickly could compromise the quality of the arrangement and therefore its impact. A hastily concluded RCEP deal that is not credible in its ambition would be a mistake and a huge lost opportunity, risking more harm than good. India is still playing its familiar role of spoiler by dragging the agreement down and other leaders have yet to expend political capital that they need to on RCEP.

There is no clear leader in RCEP. The Partnership is not China-led as is often wrongly claimed: ASEAN is the hub and inspiration, and the major powers, including China, are the spokes. The only leadership that China can show that Australia, Japan, India and others can accept is one where it commits to reforms and opening up its economy. That will benefit both China and the global economy.

RCEP is the best chance at an agreement that is inclusive of China and locks it into reforms. The CPTPP may be easier for countries to join than the original TPP since it has frozen ‘some of the more egregious provisions of TPP — especially the US-pushed intellectual property protections that were likely to benefit big business in the United States at the expense of consumers in the region’, as Armstrong explains. But expanding CPTPP membership to China is unlikely since it would close the door to any possibility that the United States might rejoin at some time in the future.

There is little chance of the United States rejoining the TPP under Mr Trump or even the president after him. Piecing together political leadership on trade in Washington will be difficult without making progress on an agenda for dealing with the issues that have led to the current problems: stagnant middle-class incomes, wider distribution of the gains from trade and a properly functioning social safety net. The US Congress is unlikely to agree to join an existing deal, even though the United States was the driving force of the original TPP. The United States’ joining a deal that China is party to any time soon is inconceivable.

If East Asia does not hold the line on corrosion of the global trade regime and protectionism, no one else is likely to.Crafting regional trade architecture without the constructive participation of the United States is the immediate challenge and will remain the challenge for the foreseeable future. Australia and Japan have led the initial charge, but China, India and Indonesia will need to step up.

Asian powers may not be ready for the sort of leadership that is needed, but the threat to their interests in the global system will not wait until they are.

The EAF Editorial Board is located in the Crawford School of Public Policy, College of Asia and the Pacific, The Australian National University.