China intensifies information warfare in bid to join TPP

By Sayaka Nambu and Seima Oki / Yomiuri Shimbun Correspondents

November 13, 2021

SHANGHAI/BEIJING — China is intensifying its “information war” in a bid to join the Trans-Pacific Partnership (TPP) free trade group.

While touting its willingness to further open its markets, China is trying to create a situation in which a large number of TPP member countries “support” Beijing’s participation, and thereby put pressure on the unenthusiastic nations of Japan, Australia and Canada.

Negotiations are expected to continue for a significant amount of time, as there are serious obstacles to China joining the pact.

Putting on a show

A large trade fair called the China International Import Expo was held in Shanghai early this month. On Nov. 7, China’s Ministry of Commerce invited Chinese and foreign reporters to a special exhibition marking the 20th anniversary of China’s entry to the World Trade Organization.

Displays in various parts of the venue state that “China will ceaselessly promote an open world economy,” touting to the world China’s policy of opening its markets.

In a speech delivered via video at the import expo, President Xi Jinping emphasized that China will actively promote its participation in the TPP and that the country remains determined to promote a high degree of opening up.

These promotional efforts at the trade fair are clearly spurred by Xi’s strong desire for China to join the pact.

On Tuesday, the city government of Shanghai opened an experimental free-trade zone, designated in 2013 as the country’s first, to the outside world for the first time. Here, too, with an eye on joining the TPP, the Xi administration has made trial efforts to ease restrictions on trade and investment.

Positive messaging

Since it formally applied to join the TPP on Sept. 16, the Chinese government has held more than 10 summit, ministerial and vice ministerial talks, and negotiations with Japan and seven other TPP members out of the total 11. Following these talks, Beijing announced that its negotiating partners had expressed positive attitudes to China joining.

China claimed that New Zealand said during a vice ministerial meeting that it will actively promote the process, and that four other countries — Brunei, Chile, Mexico and Singapore — expressed such positive stances as “support for” or “welcoming” the nation joining the TPP.

Yet, these negotiating partners made different announcements. New Zealand said only that it discussed the TPP, while the statement issued by Singapore did not even mention the trade pact.

“We’ll decide only after analyzing whether China can meet the requirements for joining the TPP,” said a Singapore government official. “China’s announcement was unexpected.”

A diplomatic source in Beijing said, “The Chinese side unilaterally made announcements, probably because it wants to show the spread of ‘support.’”

Following the foreign ministerial meeting with Mexico held in Rome at the end of October, the Chinese government also proclaimed that the Mexican side has welcomed China’s participation in the TPP.

“Within the Mexican government, it is the Secretariat of the Economy that has the right to negotiate with other countries on trade,” another diplomatic source said. “The words of the foreign secretary, who has no authority to negotiate on trade, are meaningless.”

‘Nothing to lose’

The Xi administration is pushing ahead with its “dual circulation” development model to realize a virtuous cycle of domestic and external demand, and sees trade liberalization as a lever to increase external demand.

China had fixed its eyes on joining the TPP as its next move after the Regional Comprehensive Economic Partnership Agreement (RCEP), which will take effect in January 2022.

According to a Chinese government official, China is aiming to join the TPP in 2023 following the conclusion of talks on the United Kingdom joining the TPP. To start the procedures for joining the group, it is necessary to have the consent of all member nations.

The Chinese official was confident that even Australia and Canada, which have seen their bilateral ties with China deteriorate, “probably want to recover their trade with China and will eventually approve our joining the group.”

Even if China fails to join the TPP, it will benefit from using the accession process as a form of external pressure that can be expected to promote the structural reform of its economy, and keep groups with vested interests in check.

“There is nothing to lose even if we can’t join,” the same official added.

The requirements for joining the TPP are quite strict, making it difficult for China to be allowed in even as an exceptional measure, a method that China is said to have its eye on. When China joined the WTO in 2001, the United States and counties in Western Europe hoped that bringing China into a free trade system would promote political reform there.

However, China continues under the rule of a single party, imposes arbitrary export restrictions and retaliatory tariffs on nations with which it has political conflicts.

If China were to join the TPP, it would be difficult to predict what position it would take toward the United States’ returning to the pact, as Japan, Australia, Canada and Mexico hope will happen.

Complaints have been heard about the free trade zone in Shanghai. According to an official of a Japanese-affiliated company: “It’s complicated, with lots of guidance and reports aimed at supervision and control. It will require a lot of work to do business there.”

Distrust has been growing in the international community regarding the inconsistency between China’s words and its actions.

A source close to the TPP negotiations said: “It took nearly 10 years for China to join the WTO and also for the RCEP to be concluded. It’s inevitable that the negotiations for China to take part in the TPP pact will last for a long time.”

Check on Taiwan

China’s application to join the TPP was partly aimed at restraining Taiwan, which expressed its desire to participate in the free trade pact before China did.

According to sources, China applied for membership through the New Zealand Embassy in Beijing. The sources said that, generally speaking, the application should have been filed in New Zealand and there may have been some reasons why China rushed to apply in Beijing.

China may have made the first move because it had detected steps being taken in connection with Taiwan applying.

“It is utterly impermissible for Taiwan to join the TPP before us,” a Chinese government official said.

The TPP pact stipulates in its provisions that a member should be a country or an independent tariff region, so Taiwan can join. But China is vigilant against Taiwan becoming a member and being treated as the equivalent of a state.

Beijing has opposed observer status for Taiwan in the annual assembly of the World Health Organization, primarily to limit opportunities for Taiwan to take an active part in the international community. The same logic applies to Beijing’s opposition to Taiwan joining the TPP.

Although Taiwan is no match for China in terms of economic scale, Taiwan has an easier path to meet the requirements for joining the TPP.

The pact’s member nations want to avoid being forced to choose between Beijing and Taipei as a sort of test of allegiance. Some have said that even if China and Taiwan’s TPP memberships were approved, the only option would be to admit both of them at roughly the same time, as when they joined the WTO.