China’s TPP application seen as a tactical move against anti-Beijing network

By Naoki Ogawa and Seima Oki / Yomiuri Shimbun Correspondents

17:53 JST, September 18, 2021

BEIJING — The Chinese government’s official application to join the Trans-Pacific Partnership (TPP) trade pact seems aimed at using the appeal of the country’s huge market to deter U.S. and British moves to form an anti-Beijing network.

Beijing filed the application to join the TPP free trade agreement on Thursday. The TPP is currently an 11-member group that includes Japan and Australia.

For China to join the TPP, Beijing needs to fulfill high-level criteria mainly regarding the liberalization of trade, and thus it will not be easy to realize China’s membership.

Since the TPP took effect in 2018, China is the second country to apply for membership from outside the initial founding member nations. Britain was the first.

Zhao Lijian, deputy director general of the Chinese Foreign Ministry’s Department of Information, said at a press conference Friday, “China’s participation in the TPP will promote the process of integration of economies in the Asia-Pacific region, and contribute to the recovery of the global economy, the development of global trade and an increase of investments.”

In recent years, China has aimed to enhance its influence in various fields, including the economy, diplomacy and security, and has strengthened its engagement in multilateral trade agreements and moves to create international rules.

Joining the TPP is equivalent to the next step of the Regional Comprehensive Economic Partnership (RCEP) agreement, which signatory countries aim to bring into effect in January next year.

While the United States withdrew from the TPP under the administration of former President Donald Trump, and the current administration of President Joe Biden has kept its distance from the agreement, China this year has repeatedly held unofficial negotiations with TPP member countries.

Earlier, the U.S. administration of former President Barack Obama had promoted the TPP as a scheme for economic security with the aim of forming an encircling network against China.

The current Biden administration has proceeded with moves toward decoupling from the Chinese economy, and has also created a new security framework with Britain and Australia. Through such actions, the United States has been strengthening pressure on China.

Based on those developments, China aims to instill its economic influence in the region by joining the TPP, and jolt the security strategies of the United States and Britain.

The Global Times, an English-language media outlet affiliated with the Chinese Communist Party’s official newspaper, on Friday quoted experts as saying that the application to join the TPP “aims to cement China’s leadership role in global trade, while piling pressure on the US.”

Intellectual property, state subsidies

Hurdles for China to join the TPP are seen to be high.

The TPP eliminates nearly 100% of tariffs and stipulates rules for liberalizing trade and investment at very high levels.

The TPP prohibits member countries from paying excessive subsidies to state-owned companies and obliges them to protect intellectual property rights.

In electronic commerce, the TPP prohibits member countries from demanding that foreign companies place their computer servers in the respective countries, a demand some countries would make with the aim of preventing the siphoning data.

Regarding intellectual property rights, sales of counterfeit versions of name-brand products are rampant in China, and the government has given preferential treatment to state-owned companies through subsidies and by other means.

The Chinese government has been corralling data by obliging companies to store it inside the country and limiting the transfer of data overseas.

Chief Cabinet Secretary Katsunobu Kato said at a press conference Friday, “We need to firmly confirm whether China is prepared to fulfill the high levels [of tariff limits and other rules] of the TPP.”

Member countries will hold TPP commission meetings from now on to discuss whether to start negotiations with China about its application to join.

In the case of Britain, which applied to join the TPP in February this year, the TPP commission decided to begin negotiation meetings in June.

However, some in the government of Japan, which now chairs the TPP meetings, express skepticism over whether China will accept the rules of the TPP.

To begin procedures to join the TPP, current member countries need to agree unanimously. Thus it is uncertain whether negotiations over China’s application can actually begin.