electronic Global Trade Credit Platform/eGTCP's Blog: TPP vs RCEP: Trump is Losing Big On His Decision Now

"The US exit TPP is not entirely a good thing for China; we will face many challenges in the future." Renmin University of China Executive Director of the Institute of Finance Wang Wen does not think that the US’ withdrawal will be entirely beneficial to China.

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First, Wang Wen believes that the US exit TPP has two major effects; one is to change the global trend of international trade which is expected. US-led regional trade liberalism and China-led free trade zone of the two major trade games may be expected changed. Trump may introduce new policies for the global trade in the future, so that global trade would become more uncertain.

Second, China's development is in a critical period of both opportunities and challenges, whether China in the new era of TPP to deal with non-deterministic international situation is a great challenge, the original TPP countries will continue to increase China's demands, which will enhance China's trade discourse, but also increase China's global trade system in the responsibility and burden.

China Institute of International Studies Institute of American researcher Zhang Tengjun also believes that the United States to withdraw from the TPP although China will have some decompression effect, but what will Trump do to safeguard the United States in the Asia Pacific and even international Social interests after announcing the withdrawal of TPP remains to be seen.

Before people only know that the WTO rules of the WTO trade, many people think that as long as China joined the organization, then the Chinese products can be sold around the world. However, the benefits of joining the WTO to bring China are emerging; Obama is actively promoting a replacement which is more stringent than the new rules, that is, TPP.

For this agreement which is excluded from China, the industry said: "TPP is the United States initiated the establishment of trade, investment organizations, excluding China, which is a means to contain China, set up the TPP itself is to dilute China, TPP as a cross-three continents 12 countries, a huge amount of economic trade cooperation agreement will inevitably have a huge impact on China's export trade, including China's investment in Southeast Asia, the United States investment in China. "

Therefore, the Trump in order to bring employment to withdraw from the domestic TPP, but to China it brings opportunities.

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If the TPP is not sustainable, this will facilitate the negotiations of the Regional Comprehensive Economic Partnership. The new agreement, which is to be negotiated in 2013, is made up of China, Japan, and 12 other Asian countries, and Australia and New Zealand.

The RCEP agreement does not include the United States, which makes China become the largest economy among all negotiating nations.

The face of the upcoming death of TPP, Shinzo Abe said he was ready to self-reliance, he was ready to start to support the RCEP reached.

If the RCEP reach an agreement, it will cover about 3.5 billion people, GDP will reach 23 trillion US dollars total which will accounting for 1/3 of the global total and its covering the region will become the world's largest free trade area. The Peruvian proposed to join the RCEP, intended to become one of the first members of the Latin American countries.

Of course, those countries that do not participate in the TPP will benefit from RCEP. The US-China Economic Security Review Commission (USCC), a consultancy in the US Congress, cited data in its latest annual report that China would benefit $ 88 billion if TPP failed and RCEP came into effect.

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