How Can China Break Down In Order To Deal With The Adverse Effects Of TPP?

It embodies the overall quality, high quality and ambition level, and sets up a template for the integration of trade and economic regulation in the world.

It embodies five characteristics of comprehensive market access, promoting supply chain trade, coping with new trade challenges, inclusive trade and regional integration platform.

The TPP mode has a high level rule guidance from the beginning, which is conducive to building a regional economic integration platform with high starting point and innovation. However, it does not include China, and whether other developing countries have the ability and willingness to join will be tested.

China's trade policy should be shifted from the "first generation" policy with market access as the core to the "second generation" policy with the core of regulation and integration.

To this end, China should deepen reforms in the priority areas such as government functions, decentralization, business legislation, market opening and deregulation. On the basis of full research and assessment, we should actively carry out pilot tests and pressure tests in four pilot areas.

In October 5, 2015, the 12 countries of the United States, Japan, Australia, Canada, Singapore, Brunei, Malaysia, Vietnam, New Zealand, Chile, Mexico and Peru completed the agreement negotiations on the p Pacific Partnership Agreement (TPP).

In February 4, 2016, the above-mentioned Member States formally signed the agreement in New Zealand, Oakland.

Subsequently, the agreement will be approved by the parliaments of various countries. Once the conditions of the final terms are met, the conditions can be implemented and implemented.

The TPP agreement is known as the twenty-first Century trade agreement. Its impact on China is reflected in three aspects: Trade and investment pfer, rule spillover effect and China's role in economic integration in the Asia Pacific region.

However, it should be recognized that the basic idea reflected in the terms of the TPP agreement is the establishment of a benchmark for the twenty-first Century business rules based on the global value chain, which is not inconsistent with the goal and agenda of China's current construction of an open economic system. In the face of the approaching pace of implementation of TPP, China needs to be "fixed" and "changed".

TPP: high goals, new rules, high standards

From the perspective of text structure and content, the TPP agreement embodies a comprehensive, high quality and ambitious level, and sets up a template for the integration of trade and economic regulation in the world.

It embodies five characteristics of comprehensive market access, promoting supply chain trade, coping with new trade challenges, inclusive trade and regional integration platform.

So where are the commitments and rules reached by the TPP agreement? This is mainly reflected in four aspects: market access, rules and discipline, implementation and dispute settlement mechanism, and new issues.

First, in terms of market access, through trade in goods, trade in services, investment,

The TPP agreement has substantially reduced the free flow of goods, services, investments, information and personnel in the area of temporary entry to commercial personnel and trade barriers.

For example, tariff and non-tariff barriers have been substantially reduced in the field of trade in goods.

On the issue of services, it is required to be similar to trade in services. It is not allowed to set the number of financial service providers, entity types and localization restrictions, and allow direct cross-border sales of specific financial services. On the telecommunications issue, it is required to ensure the right to use and access to telecommunications infrastructure of all enterprises and foreign service providers.

Second, in terms of rules and disciplines, TPP stresses the openness, pparency, impartiality and operability of procedures, including customs management, identification of origin, technical barriers to trade, trade remedy, government procurement and competition policy.

The traders submit electronic information before the arrival of the goods; on the issue of origin rules, the agreement specifies the formula and method for calculating the proportion of products and origin, as well as the implementation procedures for certification of origin rules from records to verification; in the field of government procurement, the agreement is committed to following an open, fair and pparent procurement procedure, stipulating that procuring entities shall not require suppliers to have the work or performance of the country where the procuring entity is located, and in the form of annexes, the "positive list" of the government procurement entities and activities is defined, that is, the government procurement country reduction schedule; in the field of competition policy, the agreement stipulates that the implementation of the domestic competition law of the member states shall include specific commitments and standards for pparency and procedural justice in the agreement, prohibiting anti competitive commercial activities, and fraudulent and fraudulent business activities. In the management of customs, ensuring the consistency and pparency of Customs procedures is the basic goal of the agreement.

Third, in the implementation and dispute settlement mechanism, the TPP agreement set up a working committee of the TPP Committee and several specific topic areas to guide, monitor and evaluate the implementation and operation of the terms of the agreement, and put forward Advisory proposals.

In terms of labour and environmental issues, the agreement requires Member States to establish agreements and dialogue mechanisms in their country, such as the labor dialogue and cooperation mechanism and the public consultation mechanism on environmental issues.

In the field of intellectual property rights, the agreement has established a strong law enforcement system, including civil procedures, interim measures, border measures and criminal procedures and penalties for forgery of trademarks and copyright plagiarism, while clearly defining the scope of intellectual property protection and the duration of protection.

The introduction of the investor state dispute settlement mechanism (ISDS) to neutral and pparent arbitration between foreign investors and host governments is a significant progress.

It gives multinationals greater power to compensate for losses caused by changes in host country laws and policies.

Finally, the TPP agreement introduces new "horizontal" issues such as temporary entry of business personnel, state-owned enterprises and designated monopolies, competitiveness and business facilitation, development, SMEs, regulatory coherence, pparency and anti-corruption.

These new topics are designed to create an open, fair and expected rule environment for all market players to promote coordination, collaboration and effective supervision within the boundaries of contracting parties.

At the same time, the TPP agreement puts forward the objectives of capacity building, business promotion and development. Through the establishment of relevant institutions and cooperation mechanisms, it helps parties strengthen the ability to implement agreements, enhance the competitiveness of Member States as a whole in participating in regional and global economic activities, help SMEs participate in and effectively integrate into the regional and global supply chains, and share the benefits of trade agreements.

TPP's impact on China

Because most of the member states of TPP are China's traditional trading partners, it can be expected that when China has not joined the TPP or is excluded from TPP, the entry into force and implementation of the TPP agreement will bring certain external impact to China, which is mainly embodied in three aspects.

First of all, TPP will have negative effects on China's trade and investment pfer in the short term.

The TPP agreement eliminates the barriers to trade and investment among Member States, and opens up trade access and preferential access, rather than the need for Member States to overcome the high threshold of market access to enter the agreement market. Meanwhile, stringent rules of origin, especially textiles and clothing requirements, also exclude countries outside the region from market access.

The result is part of non member states.

The share is likely to be replaced by other member states in the agreement.

According to a simulation analysis of an economic model made by the Pedersen Institute of international economics, a famous international economic think-tank, the TPP agreement will reduce China's GDP and exports by 0.09% and 0.5% respectively in the short term.

In addition, TPP will also reconstruct the structure of supply chain, production chain and value chain to some extent, resulting in regional restructuring of cross-border capital flows (especially foreign direct investment). The good investment environment created by the implementation of the agreement will enable more capital to flow in the domestic sector.

China's domestic factor cost, industrial chain integration and the attractiveness of investment environment will face continuing competitive pressure under the pressure of TPP.

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Second, the high standard, comprehensive and open new business rules reflected in the TPP agreement will become the benchmark for bilateral or multilateral trade agreements. China's participation in global economic activities can not evade the spillover effects of these rules.

At present, China has participated in the multilateral negotiations of the government procurement agreement (GPA), the environmental products agreement (EPA) and the new information technology products agreement (ITAII) in the WTO, and has proposed to apply for accession to the service trade agreement (TISA).

At the same time, China and the United States and the European Union are also vigorously negotiating bilateral investment agreements.

Some new rules and disciplines covered by TPP are or will likely be "copied" or "copied" into the aforementioned important negotiations, thus creating great pressure on China.

For example, the main differences between China and the US and Europe in the GPA negotiations lie in procurement entities, procurement targets, threshold prices, pitional period and pitional measures. China refused to include state-owned enterprises in the list of procurement entities in the bid list, while the United States and Europe agreed that they should be included. They also refused to accept the provisions of developing countries that applied GPA in China, limiting the granting of Chinese exceptions and pitional arrangements.

As the leader of the TISA negotiations, the United States also actively proposed that the negotiating countries should ensure the free flow of data and free access to the network, and put forward the conditions that no local existence, technology pfer or purchase of domestic technology could be required to provide cross-border services for enterprises.

These are almost the same as the standards and contents of the TPP services and e-commerce chapters. If China joins the TISA negotiations, these thorny issues will surely be unavoidable.

Third, the impact of TPP on the future development path of regional economic integration in the Asia Pacific region.

At present, the economic integration in the Asia Pacific region mainly includes four ways: expanding FTAs network, RCEP, TPP and FTAAP.

But these methods have advantages, but there are also problems of low efficiency of "origin dilemma" and "multiple governance", as well as the decentralization of organizational structure.

The TPP mode has a high level rule guidance from the beginning, which is conducive to building a regional economic integration platform with high starting point and innovation. However, it does not include China, and whether other developing countries have the ability and willingness to join will be tested.

The last way is FTAAP, which reflects the choice in the Asia Pacific region to establish a framework that covers a wide range of members and returns to the APEC mechanism. However, under the current complicated geopolitical and Trade Governance Mechanism in the Asia Pacific region, it is still facing many practical difficulties to promote FTAAP under the APEC framework.

Led by China, the "East Asian Track" forward, the gradual RCEP agreement and the US led, the "Asian Pacific track" forward, and the radical TPP agreement have made the economic integration game of the Asia Pacific region enter the "concurrence mode" of the group.

Whether the two giant FTAs can be developed through competition and complementary development, and the expansion and integration of Member States and the gradual improvement of the quality of agreements will become a key factor for the realization of FTAAP in the Asia Pacific region.

Today, TPP has completed the signing of the agreement, and it will undoubtedly take the lead in shaping the regional rule pattern.

In addition, TPP, as an important support for the US's return to the Asia Pacific strategy, has taken considerable national security and political diplomatic considerations into consideration, which has a subtle impact on the current China oriented East Asian economic and trade mechanism and the geopolitical balance between the US led military alliance system.

How to break China

In order to cope with the adverse effects of TPP, China should have "fixed" and "changing".

The first is the implementation of hedging and countering strategies, starting from the geopolitical and economic interests, establishing reliable geopolitical strategies around the periphery and maintaining the strategic balance of power.

Active layout, building a new pattern of all-round opening to the outside world and a new international cooperation frame will help to alleviate the external pressure brought by TPP to China, develop economic cooperation with the countries along the belt and road, and broaden the strategic vision, take the initiative to build a wider, higher level and deeper regional economic cooperation network, and work together to create an open, inclusive and win-win regional economic cooperation framework. Based on East Asia, we will continue to promote the negotiation process of RCEP and China Japan Korea free trade agreement, to offset the trade and investment pfer effect that TPP may bring to China, advocate and promote the liberalization of trade and investment, and vigorously build a high level free trade agreement network. We should give full play to the coordination and leadership role of APEC and continue to promote the implementation of the FTAAP initiative to boost the economic integration process in the Asia Pacific region. Relying on the "one belt and one way" construction, along the periphery and along the "one belt" road.

Second, we should further develop economic and trade cooperation on the basis of consolidating and enhancing the level of the existing free trade zones, and create new driving forces and new mechanisms for the development of foreign trade and economic relations, and actively participate in the formulation of rules for trade and investment.

Taking the Sino US BIT negotiations as an opportunity to deeply participate in the global high standard rulemaking, while respecting universal investment rules and issues, we dare to put forward the Chinese version of the investment rules, and form rules that conform to their own interests, so as to provide templates for trade and investment rules under other economic cooperation frameworks. Take the initiative to participate in rules competition. In the creation of regional trade and investment rules, we should not only base on the high standard development trend of investment liberalization, but also adapt to the needs of regional economic and trade development, establish mutually beneficial and win-win regional economic and trade arrangements, and formulate intermediate rules between WTO and TPP standards, reflecting the interests of most developing countries, so as to realize the institutional competition of the global governance system.

Third, we should accelerate the pilot and reform of China's free trade area, and promote reform by opening up. The key is to accelerate the construction of a new open economy system in China.

China's trade policy should be shifted from the "first generation" policy with market access as the core to the "second generation" policy with the core of regulation and integration.

In the four FTA pilot areas, we should actively carry out pilot tests and pressure tests, such as speeding up the pilot reform of foreign investment management system, drawing on TPP's general rules on issues such as trade in services and investment, and effectively promoting the management mode of "national treatment plus negative list before admission"; promoting the financial innovation system with the goal of capital account convertibility and opening of financial services industry in an orderly way; conducting pilot projects on the reform of interest rate marketization and cross border use of Finance and other financial reforms in order to improve the level of financial openness and investment and financing; and set up an arbitration cooperation alliance of China's free trade area, coordinate legislation and administration, and jointly improve the level of socialization, specialization and internationalization of China's commercial arbitration. To this end, China should deepen reform in the priority areas such as government functions, decentralization, business legislation, market opening, deregulation, etc., based on full research and evaluation.