On Thursday, China applied to join the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) — a regional economic organization whose 11 member countries have a combined GDP of US$11 trillion. That is less than China’s 2019 GDP of US$14.34 trillion, so why is China so eager to join?
China says there are two main reasons: To consolidate its foreign trade and foreign investment base, and to fast-track economic and trade relations between China and member countries of the CPTPP free-trade area.
China’s bilateral trade with these countries grew from US$78 billion in 2003 to US$685.1 billion last year, mostly because of China’s 2005 accession to the ASEAN free-trade area. Even so, China must have other, more important considerations than just trying to expand its economic territory.
China’s first consideration is counter-encirclement. The CPTPP’s forerunner was the Trans-Pacific Partnership (TPP). Then-US president Barack Obama’s motive for proposing the TPP was for countries on both sides of the Pacific to economically encircle China.
However, Obama’s successor, former US president Donald Trump, announced the US’ withdrawal from the TPP on his first day in office. That left Japan holding the TPP baby, which was rebranded as the CPTPP.
For China, joining the CPTPP in the US’ absence would be an act of counter-encirclement and it would diminish the US’ importance on the world stage.
It would also give China leverage over Taiwan, making it more difficult for Taiwan to join the bloc.
China’s second aim is to strengthen and consolidate its Belt and Road Initiative. Among the CPTPP members, only Japan, Canada, Australia and Mexico are outside the initiative, while Malaysia, Singapore, New Zealand, Vietnam, Brunei, Chile and Peru are all initiative partners. If China joins the CPTPP, it would gain another chain with which to bind these countries and consolidate its initiative.
The third aim is to deepen other countries’ dependence on China. If China joined the CPTPP, the other member countries’ systematic economic dependence on China would deepen, and even Australia would be unable to resist.
Beijing’s fourth purpose is to use trade for political ends. Business interests often pressure politicians into making decisions that are favorable to China, but unfavorable to their respective nations. If China joins the CPTPP, it would find it easier to use businesspeople to force their governments to comply.
The fifth aim is to call the shots on economic and trade rules. Obama’s initial reason for creating the TPP was, in his own words, that “we can’t let countries like China write the rules of the global economy.”
As China’s power grows, if it takes the further step of joining the CPTPP, it would be able to dictate regional trade rules. Japan would need to hand the platform it has worked so hard to build over to China.
Joining the CPTPP is another step in China’s strategic expansion, so Japan and Australia must find a way to stop it.
Liu Ming-te holds a doctorate in political science from the Free University of Berlin.
Translated by Julian Clegg
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