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If TPP fails, US will cede trade leadership role to China: US Trade Rep
July 30, 2016, 6:11 am

People attend a rally protesting the Trans-Pacific Partnership (TPP) in Maui, Hawaii, the United States, July 29, 2015 [Xinhua]

People attend a rally protesting the Trans-Pacific Partnership (TPP) in Maui, Hawaii, the United States, July 29, 2015 [Xinhua]

The top trade official of the Obama administration has warned that failure to ratify the TPP trade deal would ensure that the US ceded leadership in global trade to China.

“We’re one vote away from either cementing our leadership in this region and in the global trading system or ceding it to China… At the end of the day I don’t think Congress wants to be responsible for handing the keys to the castle to China,” US Trade Representative Michael Froman said on Thursday.

A Reuters report said Froman has ruled out renegotiating the “carefully balanced” text.

The deal would aim to liberalize trade in 40 per cent of the world economy, negotiators claim.

China, and other BRICS countries, are not among the TPP nations.

It is uncertain whether the US will sign the controversial pact before the presidential election in November 2016. Presidential hopefuls in the US have declared their opposition to the TPP in its current form.

Republican nominee Donald Trump has said the TPP is “a rape of our country”. His Democratic opponent, Hillary Clinton, has also said she would vote against the deal in the US Congress.

There has been a strong backlash against the deal in many other participant countries as well.

The TPP is a US-led trade deal that includes Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, Peru, New Zealand, Singapore and Vietnam.

China welcomed the TPP breakthrough earlier in October last year. China’s Commerce Minister Gao Hucheng said that China is open to all the free trade arrangements that are beneficial to the world’s trade liberalization and regional economic integration, as long as they are open and transparent.

China and other Asian countries are backing their own trade deal, the RCEP.

Beijing is a key driver of the Regional Comprehensive Economic Partnership (RCEP), a proposed 16-nation free-trade area that would be the world’s biggest such bloc, encompassing 3.4 billion people.

The 13th round of negotiations for the RCEP was held last month in Auckland.

The China-led RCEP is a 16-nation trade bloc which includes the ASEAN plus China, India, Japan, South Korea, Australia and New Zealand.

A crucial RCEP ministerial meeting will be held in Laos on 5 August.

Meanwhile at the APEC Summit last year in Manila, world leaders took stock of the mammoth China-backed Asia Pacific FTA negotiations launched during the 2014 summit in Beijing.

Beijing is trying to counter US’ progress in forming a Trans-Pacific Partnership that excludes China by this alternate mega Free Trade Agreement in the Asia Pacific.

A Wall Street Journal report had said the US was trying to block China’s efforts at introducing the Asia Pacific FTA negotiations.

The RCEP and TPP and a host of other FTA negotiations sprung up after a decade of talks failed to conclude a global trade deal, the so-called Doha Round.

By pushing for a wider deal in the Asia Pacific that would equal the EU, China would also steal a march over the TPP championed by President Barack Obama’s administration.