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To prevent protectionism from spreading and take advantage of an opportunity to lead the world in the promotion of free trade, Japan, together with other countries concerned, needs to deepen cooperation with Britain.
The British government has applied to join the Trans-Pacific Partnership (TPP), a free trade pact with 11 member countries, including Japan and Australia. If the application is accepted, Britain would become the first new member to join the trade agreement as a country other than the 11 inaugural nations.
With the participation of Britain in the multilateral free trade agreement, the total gross domestic product of the members would increase from 13% of global GDP to 16%.
Britain, which has left the European Union (EU), is apparently trying to strengthen its relations with countries outside the EU, including those in Asia where economic growth has continued.
Japan and Britain have already concluded a bilateral economic partnership agreement (EPA) and share a philosophy of placing importance on free trade. Britain’s application for TPP membership is welcomed.
For Britain to join the TPP pact, it is necessary to obtain consent from all the ratifying countries. The TPP member nations plan to set up a working group as early as this spring and start negotiations with Britain. Japan, as the chair country, should make every possible effort to facilitate the talks.
It is significant that Japan will take the lead in reaching an agreement for the new membership and expanding the framework of the trade pact that came into force in 2018. It is important to use Britain’s entry into the multilateral free trade pact as a springboard to expand its membership.
However, the rules should not be loosened for that purpose.
In addition to a tariff elimination rate of nearly 100%, the TPP has established rules of a high standard, including regulations on infringement of intellectual property rights and subsidies for state-owned enterprises, some of which are not included in the EPA between Japan and Britain.
It is necessary to ask Britain to accept all the rules.
South Korea and Thailand have shown interest in the TPP pact, while China has expressed the intention to consider joining it. China is believed to have difficulty coping with the high level of liberalization. If the country applies for the membership, it could demand that conditions for entry be eased.
Japan should thoroughly explain to China the fundamental position of the pact that accepting strict standards is essential. It is important to take concerted action with Britain.
The TPP was previously led by the United States with the aim of keeping China in check, but former U.S. President Donald Trump, who promoted his “America First” policy, decided to withdraw from the agreement. The new administration of U.S. President Joe Biden, which is likely to prioritize employment and industries in the United States, has also been reluctant for an early return to the multilateral free trade pact.
However, China’s unfair trade practices must be addressed through multinational cooperation, including the participation of the United States. The TPP pact, with Britain as a member, would be a powerful framework for that purpose. The Japanese government must tenaciously urge the United States to return to the pact.
