It is still unknown whether there is enough support among the remaining 11 Trans-Pacific Partnership (TPP) parties for the deal to enter into force without the United States. While some parties, including Japan, New Zealand and Australia are receiving encouragement and making strong pronouncements of their commitment to charge ahead with the deal, other parties are expressing reluctance to do so. Interestingly, many TPP provisions may find a new home in a renegotiated North America Free Trade Agreement (NAFTA) and be used for bilateral trade deals with the United States. So for now, parts of the TPP do not appear to be going away anytime soon.
Encouragement from US Senator John McCain
Most recently, during a visit to Australia in his speech to the United States Studies Centre, US Senator John McCain encouraged Australia and Japan to move forward with the TPP and that “hopefully, someday, in the future, under different circumstances, America will decide to join you.” He also stated that the US withdrawing from the deal was damaging and a major strategic mistake. Senator McCain’s statements are no doubt well received by Australia, Japan and New Zealand and will likely provide the parties hope that the US could change its position in the future.
May 21, 2017 APEC in Hanoi, Vietnam
On May 21, 2017 the remaining 11 parties of the Trans-Pacific Partnership (TPP) released a joint statement that not only reaffirmed their support of the TPP, but also the parties “agreed to launch a process to assess options to bring” the TPP into force quickly and “how to facilitate membership for the original signatures.” The joint statement stated that “[t]he ministers tasked their senior trade officials to engage to take forward the preparation of this assessment. Ministers asked for this work to be completed before they meet in the margins of the APEC Economic Leaders Meeting on 10-11 November 2017 in Da Nang, Vietnam.”
The November deadline will put some pressure on the 11 parties to make a decision on how to proceed. As reported in the Japan Times, Mexico recently stated that is was aligned with Japan when its deputy minster for foreign trade said that “Mexico and Japan have a very important role to play” in order to bring the TPP into force. However, despite such statements, there are some fractures emerging within the group. For example, it was reported that Malaysia is less enthusiastic and would like the deal to be renegotiated given that the largest economy is no longer part of the deal. Whereas New Zealand thinks the deal should move forward without significant change.
New Zealand’s Ratification
In a show of support that created additional momentum, just prior to the meeting of the TPP-11 during the Asia Pacific Economic Cooperation (APEC), New Zealand finalized its ratification of the agreement. Trade Minister Todd McClay stated that New Zealand recognizes the “value in a common set of high-quality rules across the Asia-Pacific.” This move came after Japan ratified it and Australia has clearly indicated its support for moving forward with the TPP without the United States.
A new home for TPP in NAFTA
Meanwhile, as reported in Bloomberg, US Department of Commerce Secretary Ross has stated that certain provisions of the TPP could be used as a starting point for NAFTA renegotiation and that the concessions NAFTA partners made in the TPP should not be lost in NAFTA renegotiation. Additionally, it was reported in Politico that some of the TPP provisions are part of the Trump administration’s wish list for bilateral trade deals.
So while the TPP has not entered into force yet, the text of the agreement is still relevant and will be used for NAFTA renegotiation and likely continue to be used in various forms.