World Economy

Australia Will Pursue Asia Trade Deals If TPP Dies 

Julie BishopJulie Bishop

Australia will move on and pursue other trade deals in Asia if the Trans-Pacific Partnership collapses, Foreign Minister Julie Bishop says.

The future of the 12-nation deal is in doubt with both US presidential frontrunners Hillary Clinton and Donald Trump opposed to it.

Australia and New Zealand are both signatories to the deal, along with Canada, Malaysia, Brunei, Chile, Singapore, Vietnam, Japan, Mexico and Peru, AAP reported.

But the agreement could die if President Barack Obama fails to guide it through Congress before he leaves the White House in January.

Bishop held talks with representatives from both Clinton and Trump camps while in Washington on Saturday for an oceans conference, urging them to consider the deal.

She had a "fairly sympathetic" hearing from the representatives but Australia should continue to press the case for liberalized trade.

"Invariably if there is no Trans-Pacific Partnership we are be looking for other free trade agreements and continuing our quest for a free trade zone in this part of the world, in the Asia-Pacific," the foreign minister told reporters.

"But we still want to see the Trans-Pacific Partnership pass through the US Congress".

Given the TPP agreement may never enter into force due to the uncertain political landscape in the US, Australia and the other six countries (New Zealand, Japan, Singapore, Malaysia, Brunei and Vietnam) that are members to both the TPP and the RCEP are focusing their international trade policies on the latter economic partnership.

Bishop said Obama was pressing the case for the deal.

  In Serious Danger

Despite last-minute efforts by the Obama administration, the US Congress’ ratification of the TPP agreement is in serious danger.

The globalization backlash has extended to Democratic nominee Hillary Clinton, who has also turned her back on the TPP. Progressive Americans remain concerned with the role of free trade in rising levels of socioeconomic inequality.

But running alongside the crippled TPP, and potentially of more importance to Australian trade, has been the Regional Comprehensive Economic Partnership. Essentially, the RCEP is a free trade agreement between the ten ASEAN members and the six countries with which ASEAN has existing FTAs. This includes Australia, China, India, New Zealand, Japan and South Korea. The 16 member states of the RCEP have agreed to finalize negotiations on the agreement before the end of this year.

If, as seems likely, the RCEP is accomplished in the near future, it will be the world’s largest free-trade agreement, covering a population of 3.5 billion, or more than 50% of the world total, and about 40% of the world trade volumes.