An idea has emerged that the Trans-Pacific Partnership free trade pact can take effect among at least five nations such as Japan, Australia and New Zealand, negotiations sources said Wednesday.
The idea cropped up as the 11 states involved discussed what to do with the pact, from which the United States withdrew earlier this year after President Donald Trump took office, the sources told Kyodo News.
At the just-finished two-day meeting of top negotiators from the 11 parties, Tokyo argued for making the TPP take effect without the United States at an early date by tweaking the original agreement only slightly, they said.
But some countries, including Vietnam and Malaysia who had hoped to boost exports to the United States, are believed to have expressed reluctance to put the TPP into force without Washington.
Chile and Peru have shown no keen interest in a U.S.-absent TPP, the sources said. Canada and Mexico are noncommittal as they brace for renegotiations on the terms of the North American Free Trade Agreement with the United States, they said.
If differences are not bridged among the 11 countries, the five-or-more-nation solution could gain traction with free trade-oriented Singapore and Brunei counted as possible partners.
Tokyo had also expressed reluctance to have the TPP come into force without Washington amid concern a TPP is unlikely to provide a tailwind for Japanese exporters, such as automakers, without the United States, the biggest market in the grouping.
But with free trade perceived to be under threat with the rise of protectionism since the launch of the Trump administration, calls have been growing in the government for Tokyo’s leadership to keep up the momentum for free trade.
Japan’s chief negotiator, Keiichi Katakami, told reporters after the meeting that he called for a united front among the 11 states in charting the future course for the TPP.
He also said participants agreed to continue discussions on possible effectuation of the TPP, though he acknowledged that there exist divergent views among them.
“There was a shared view that we 11 countries should move things forward so as not to lose the momentum of the TPP,” Katakami said.
The negotiator talks will be followed by a meeting of the countries’ trade ministers later this month. Japan hopes to strike a new deal by mid-November, when a summit of the Asia-Pacific Economic Cooperation forum will be held in Vietnam.
The TPP was signed in February 2016 by Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam — covering around 40 percent of the global economy.
Under current rules, the TPP’s implementation requires ratification by nations accounting for 85 percent of the combined gross domestic product of the 12 countries. The deal was therefore effectively dead following the withdrawal of the United States, as the country represents over 60 percent of the trade bloc’s GDP.