A mere nine pages contain the resulting text of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPATPP) negotiations, which concluded on Jan. 23, 2018.1 The agreement is scheduled to be signed on March 8, 2018, in Santiago, Chile. The best way to understand CPATPP, also known as TPP-11, is considering it as the result of the United States' withdrawal from the original Trans-Pacific Partnership Agreement (TPP).2
After the U.S. departed from the TPP, the other 11 signatories (Australia, Brunei Darussalam, Canada, Chile, Japan, Mexico, Malaysia, New Zealand, Peru, Singapore and Vietnam) came up with a minimalistic approach, avoiding a complex and complete overhaul of the TPP. Instead, a limited number of obligations that originally had aimed to comply with U.S. objectives and Trade Promotion Authority goals were identified and suspended.
One major difference is the title of the new agreement. Adding the words "Comprehensive and Progressive" seems more of a political statement rather than a substantive change, and it may well be that the only major additions to the TPP are making express reference to "corporate social responsibility," "indigenous rights," "inclusive trade" and "traditional knowledge" in its preamble language. Those concepts were not included in the original TPP preamble.
Regarding the suspension of the application of certain provisions, CPATPP strikes from the 30 Chapters of the TPP very few but controversial obligations. Below is a cursory look at highlights of the CPATPP:
It is still possible that some countries could internally reject approval of a treaty that made sense only if the United States was part of it (accepting high-standard international trade obligations was counterbalanced by market access to the U.S. and its value chains), although that is not likely because many of the most controversial obligations were suspended. The mere idea of diversifying trade vis-à-vis a more protectionist stance on the part of the U.S. may be enough to justify the approval and quick entry into force of the CPATPP.
The CPTPP text keeps all of its references to the United States, probably hoping for the U.S. to eventually join again. Unlike the TPP, CPTPP countries have not yet published any side agreements, or "side letters," which modify or alter the compromises stated in the agreement. Many of these are bilateral agreements that further consolidate additional protections or free trade among specific partners.
Also unlike the TPP, the CPTPP has a less restrictive approach with regard to its entry into force. TPP basically required the U.S. to be a part of the agreement to enter into force – or requires a combination of members, including Japan, that achieves the established goal of a minimum gross domestic product (GDP) sum. The TPP-11 will enter into force 60 days after the date on which at least six members or 50 percent of the number of signatories to the CPTPP (50 percent refers to the possibility of other countries joining the CPTPP before its entry into force), whichever is smaller, have completed their legal procedures and notified it to the depositary.
Ministers of all 11 member countries are scheduled to officially sign the CPTPP on March 8 in Santiago, and because the changes contained in the nine pages do not seem substantive or controversial, all parties should quickly obtain their required internal approvals.
The idea of adding new members into the TPP-11 makes it more relevant, providing an interesting alternative to further trade relations with groups of countries that have no preferential trade relations among them – potentially even the United States and United Kingdom – and probably making it more significant and attractive than other trade agreements such as the Pacific Alliance (Alianza del Pacífico4). However, CAPTPP is also competing with other regional initiatives, such as the China-backed Regional Comprehensive Economic Partnership (RCEP), for which negotiations are expected to intensify in 2018.5
1 The negotiations took less than a year to conclude.
2 See Holland & Knight's alert, "Is the Trans-Pacific Partnership Still Possible Without the United States?", Nov. 29, 2016.
4 Alianza del Pacífico includes Chile, Colombia, Mexico and Peru, who are currently negotiating with Australia, Canada, New Zealand and Singapore to become "Associated States."
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