Trans-Pacific Partnership: Notes for UPSC

The Trans-Pacific Partnership (TPP), also called the Trans-Pacific Partnership Agreement, was a proposed trade agreement between Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam, and the United States signed on 4 February 2016 in Auckland.

The TPP is an important concept in the International Relations segment of the IAS Exams.

History of the Trans-Pacific Partnership

The TPP was initially formed as an expansion of the Trans-Pacific Strategic Economic Partnership Agreement (TPSEP) signed by Brunei, Chile, New Zealand and Singapore in 2005. At the beginning of 2008, additional countries joined the discussion for a broader agreement: Australia, Canada, Japan, Malaysia, Mexico, Peru, the United States, and Vietnam, bringing the negotiating countries to twelve. After the newly elected US President Donald Trump withdrew the US signature from TPP in January 2017, the agreement could not enter into force.

After the United States withdrew from the agreement, the other 11 TPP countries agreed in May 2017 to revive it and reached an agreement by January 2018. In March 2018, the 11 countries signed the revised version of the agreement, called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. After ratification by six of them (Australia, Canada, Japan, Mexico, New Zealand and Singapore), the agreement came into force for those countries on 30 December 2018.

What was the TPP original purpose?

The original TPP agreement consisted of measures to lower both non-tariff and tariff barriers to trade, and establish an investor-state dispute settlement (ISDS) mechanism. The U.S. International Trade Commission, the Peterson Institute for International Economics, the World Bank and the Office of the Chief Economist at Global Affairs Canada found the final agreement would if ratified, lead to net positive economic outcomes for all signatories, while an analysis using an alternative methodology by two Tufts University economists found the agreement would adversely affect the signatories.

Many observers have argued the trade deal would have served a geopolitical purpose, namely to reduce the signatories’ dependence on the Chinese trade and bring the signatories closer to the United States.

Criticism against the Trans-Pacific Partnership

• Some critics and even supporters of the TPP wanted the deal to contain measures that would crack down on nations who engage in alleged currency manipulation, notably China. However, that has not been the case yet.
• As with many trade agreements, until being finalized, negotiations for the TPP were conducted with significant secrecy. Drafts of the agreement were kept classified during negotiations, and access to the working text was significantly restricted even for government officials and business representatives involved in the talks. As a result, there have been allegations that the TPP has not been transparent despite being an open trade agreement.

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