Regional free trade negotiations in the Asia-Pacific region that are backed by China could finally see some momentum, following a decision by newly-installed U.S. President Donald Trump to withdraw from the Trans-Pacific Partnership (TPP) pact, but no one is celebrating just yet as countries, including China, still try to grasp specific policies and actions the U.S. might take going forward, experts said on Sunday.
On its first day in the White House, the Trump administration turned populist rhetoric on the campaign trial into action, announcing new economic and trade policies that include withdrawing from the TPP, pillar of the U.S. strategic rebalance to the Asia-Pacific region under Barack Obama.
The new U.S. administration will take a trade strategy that helps grow the U.S. economy and bring jobs back to the U.S., the White House said in a statement posted on its website on Friday, following the inauguration of Trump, who spent much of his inaugural speech in blasting other countries and Washington elites for trade deals that took American jobs away.
"This strategy starts by withdrawing from the Trans-Pacific Partnership and making certain that any new trade deals are in the interests of American workers," the statement read, adding that the U.S. will also renegotiate the North America Free Trade Area.
Such a move put the future of the 12-nation pact up in the air, with some experts saying the TPP is basically dead.
But this could also mean some fresh momentum for negotiations of other regional trade deals backed by China, including the Regional Comprehensive Economic Partnership (RCEP), according to Wang Jun, deputy director of the Department of Information at the China Center for International Economic Exchanges.
"This could be a good time for countries to push forward negotiations for the RCEP because there is a demand for alternative free trade agreements should the TPP fail, which seems to be a high-probability event," Wang told the Global Times on Sunday. He said some countries that would have been in both the TPP and the RCEP will likely focus more on the latter now.
The 16-nation RCEP would include countries in the Association of Southeast Asian Nations, China, Australia, India, Japan, South Korea and New Zealand, but not the U.S. Most of the countries in the RCEP would also be in the TPP.
Focusing on the RCEP will "definitely" be the next step for many countries if the TPP fails to be implemented, Gu Xueming, president of the Chinese Academy of International Trade and Economic Cooperation of the Ministry of Commerce, told the Global Times on Sunday.
"Countries like Australia have already made it clear that they will pursue other regional free trade deals if the TPP fails," Gu said.
However, nothing is set in stone because, although the Trump administration expressed a tough stance on the TPP and other multilateral trade pacts, "there are a few things Trump might do, including renegotiate the TPP," according to Wang.
The White House statement on Friday seems to leave some doors open for trade deals by saying "with tough and fair agreements, international trade can be used to grow our economy, return millions of jobs to America's shores, and revitalize our nation's suffering communities."
There are also many other uncertainties about the Trump administration's trade policies, "and I expect many countries, including China, are still watching closely before making any decision," Wang said.
