U.S. Absent from Largest Free Trade Agreement Ever

WASHINGTON, DC – As the United States begins the process of wrapping up a Congressional session and administration, 15 countries in Southeast Asia have joined with five regional partners in signing the largest free trade agreement in history (on November 15, 2020). The Regional Comprehensive Economic Partnership (RCEP) once included both the U.S. and India before the Trump and Modi administrations withdrew. Now the RCEP is set to connect about 30 percent of the global population and output and could add $500 billion to world trade in the next ten years, according to the Brookings Institute. The new agreement – along with the CPTPP (known at one time as the Trans-Pacific Partnership, or TPP) will make the economies of North and Southeast Asia more efficient, linking their strengths in technology, manufacturing, agriculture, and natural resources. Brookings explains that the agreement incentivizes supply chains across the region but also caters to political sensitivities, though its intellectual property rules add little to what many members have in place. The group adds that the U.S. could still join the RCEP and there are three options moving ahead. One option is to continue down the same path will pushing countries to choose between economic and security risks. A second option is to reengage fully and rejoin both the CPTPP and the RCEP forcing China to do so as well – though there appears to be little support in Congress. The final option is to emphasize engagement with narrow but firm security commitments allowing more time for ambitious initiatives in both rules-based trade and military cooperation.
(SOURCE: All Ag News)