Expanding the P-4 Trade Agreement into a Broader Trans-Pacific Partnership: Implications, Risks and Opportunities
In 2005, New Zealand, Singapore, Chile and Brunei entered into a path-breaking free trade agreement, the Trans-Pacific Strategic Economic Partnership Agreement which is also known as the P-4 Agreement. The agreement contains an open accession provision which explicitly contemplates the expansion of the agreement to include other countries willing to commit to its terms. The expansion of the agreement has important implications for the world trading system. Its broad coverage and open accession provision may suggest that the agreement has the potential to serve as a stepping stone in the path towards further multilateral trade liberalization in the WTO context. On the other hand, expanding the agreement could result in an agreement so powerful that its members no longer consider devoting energies to liberalizing in the WTO context to be of great importance. The article explores some of the unique aspects of the TPP as well as the potential implications of expanding the agreement, both for the East Asian region and for the broader multilateral trading system.
Defragmenting World Trade
This article argues that unchecked multiplication of regional trading blocs seriously fragments world trade, and simultaneously debilitates the multilateral trading system. It endeavors to overcome some of shortcomings of existing literature in this field, such as sector-specific approach and concentration on economic analysis. It attempts to offer holistic, normative diagnosis and prescription anchored by the trade, regulatory, and development objective of the global trading system represented by the WTO. From such a telic standpoint, the article highlights teleological failures caused by regionalist fragmentation and proposes both institutional and judicial means to defragment world trade. The article warns that such regionalist fragmentation is trade diverting, rather than trade creating, and tends to hijack the multilateral trade negotiations under the WTO, thereby depriving the current Doha Round of its deserved attention and confidence - possibly even torpedoing the Round entirely. It concludes that to defragment world trade, regional trading blocs should be re-configured to conform to a federalistic order in the constitutional terrain of the multilateral trading system through two multilateralizing solutions - one institutional and one judicial.
The Australian policy and practice of preferential bilateral trade : a benign or malign alternative to the WTO multilateral free trading system?
The subject‐matter of this article is the recently altered trade policy and practice of Australia and their consistency with the WTO multilateral trading policies and principles. Following its unhappy experience with the power and politics driven trading under GATT, Australia unequivocally supported the legalistic approach of the WTO trading system during the Uruguay Round. Its active participation in the WTO has given it a fair share of global free trade. The rule‐based trading framework of the WTO protects, more often than not, Australia from powerful trading states and blocs using their economic clout to gain unfair terms of trade. Australia has recently opted to pursue its multi‐track trading together with its commitments to WTO multilaterial trade liberalization. Since 2002, it has been negotiating a preferential bilateral free trade agreement with its preferred trading partners. The flurry of such negotiations has resulted in the conclusion of a preferential bilateral free trade agreement with Singapore in 2003. Negotiation towards a similar agreement with the U.S. is ongoing. A preferential trade agreement (PTA) is by nature discriminatory and as such inconsistent with the Most Favoured Nation (MFN) rule under GATT Article I. Despite this apparent contradiction, GATT Article XXIV permits bilateral PTAs as an exception to the MFN rule under certain explicit conditions, which militate against discriminatory, differential and unequal trading deals among WTO members. This article examines the extent to which the existing and potential PTAs of Australia comply with the conditions of GATT Article XXIV. It concludes that these PTAs are not complementary, if not obstructive alternatives, to the WTO multilateral free trading system. They are not in the best long‐term trading interest of Australia either.