China Wants to Join the Trade Pact Once Designed to Counter It
The following is an excerpt of ASPI Vice President Wendy Cutler’s op-ed originally published in Foreign Policy.
China has officially launched its bid to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). On Sept. 16, Beijing filed its formal application to become part of the 11-member trade pact—whose members include Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam—by sending a notification to New Zealand’s trade minister, the designated CPTPP member who serves as the repository for administrative matters.
The signs that this was coming have been building for a while.
At the Asia-Pacific Economic Cooperation CEO Summit last November, Chinese President Xi Jinping said Beijing was giving “positive consideration” to the agreement. Meanwhile, over the past year, Chinese officials have been consulting with select CPTPP members while studying the detailed provisions at home.
The timing of the announcement, however, was largely unexpected. Many trade officials had anticipated that Beijing would carefully watch developments in the United Kingdom’s CPTPP accession process, which recently started, before formally stepping forward. It was also assumed that Beijing would follow London’s example and take time to line up support from current CPTPP members so that its announcement would be met with positive responses. While Malaysia and Singapore have been welcoming to China, reaction from others has been muted at best.
It’s not entirely clear what motivated China to move now. Some have speculated that the CPTPP application was a response to the announcement the previous day of the Australia-U.K.-U.S. security partnership, but Beijing quickly denied such a link. Perhaps China wanted to forestall any possibility that Taiwan would get on the CPTPP wagon. Or, with entry into force of the Regional Comprehensive Economic Partnership agreement on track for early next year, a self-confident Beijing may have seen this as an opportune time to shift its attention to the other large regional trade agreement.
What is clear is that China had little to lose and much to gain from officially seeking CPTPP membership. Two potential risks were probably considered but quickly dismissed. First, could Beijing’s announcement prompt Washington to reconsider joining the CPTPP? And second, would existing CPTPP members reject China’s bid with a “thank you, not interested” response? Neither of these scenarios seems likely, the first due to domestic U.S. politics, the second to international economic realities.
The potential upsides, however, are plentiful. It’s an opportunity for Beijing to continue to try to gain the moral high ground on the importance of a rulesbased trading system, which started with Xi’s 2017 speech at the World Economic Forum praising the virtues of free trade and warning against the dangers of protectionism. When discussing the CPTPP application last week, Zhao Lijian, a spokesperson for China’s Ministry of Foreign Affairs, mirrored these themes by underscoring that China is a strong supporter of trade liberalization as it pushes for “economic cooperation and regional economic integration.”
And what better way to continue this quest than to seek entry into a trade pact shaped by the United States but where domestic politics and priorities preclude U.S. participation at this time? Beijing’s CPTPP application brings to the forefront the lack of a robust U.S. trade agenda for this critical region.