Beijing’s Response to the TPP

“China’s Free Trade Agreement Strategies”
Guoyou Song and Wen Jin Yuan
The Washington Quarterly
Fall 2012

Song and Yuan from the Center for Strategic and International Studies (CSIS) suggest that China sees the Trans-Pacific Partnership free trade famework being driven by the United States as an implicit threat to its foreign policy goals. The authors argue that the TPP is seen by Beijing as a soft-power aspect of the US “pivot to Asia,” and that the agreement would undermine Asian economic integration.

While China wants to respond with a free-trade agreement (FTA) series of initiatives on their own, the authors argue that domestic politics will make that impossible. Unlike their counterparts in the developed world, domestic Chinese enterprises, SOEs, and other commercial interests see FTAs as a net negative. Too much of Chinese industry still relies on protection at home for competitive advantage, and FTAs would undermine the “safe base” aspect of SOE global growth strategies.

The end result is that the U.S. is quietly creating the framework for Asia’s economic future, and it puts the U.S. smack at the center of that future. Chinese companies, for their part, will be left to fight for new regional markets rather more hobbled.

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One thought on “Beijing’s Response to the TPP

  1. Pingback: Is Anybody Following as We Pivot? « The Peking Review

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