Why We Need the TTP in Developing Countries
On his first full day in office, the 45th president of the United States President Donald J. Trump formally signed an executive order to once and for all withdraw the country from the Trans-Pacific Partnership (TPP), a trade agreement painstakingly negotiated between twelve states (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam) from 2008. This move permanently ended all the hopes cherished by Barack Obama and other individuals who wanted to see free and equal trade expanding across a region that made up 40 percent of the world’s economy. Not everyone is spilling tears over the deal’s funeral–in fact, many trade unions, isolationists and members of Obama’s own party are congratulating Trump on what they term “a righteous decision” that would timely prevent big corporations from “selling out American jobs behind closed doors.” Yet without the TPP, in certain parts of the world transnational smuggling of ivory and shark fin will thrive, corrupt governments will continue imposing sky-high tariffs to render products inaccessible to half the population, and factories will go on flushing tons of waste into local rivers without heeding. And up in the mountainous regions of rural Dien Bien, thirteen-year-old Hieu, like 1.75 million Vietnamese children his age, will continue to wake up to the smell of the dingy assembly line, ready to do the work that he loathed for a few thousand dongs (0.04 USD) per day.
An important feature of the TPP that its opponents tend to conveniently forget is the multitude of regulations on labor conditions, environmental protection, intellectual property and governmental transparency that it enforces on its signatories. It is the first free trade agreement in the world to devote an entire chapter to environmental commitments. To the workers in developing countries, the deals’ regulations on labor rights would have meant drastic improvements in their living standards. In the status quo corporations in Brunei, Malaysia and Vietnam ruthlessly sacrifice the benefits of their laborers and the sustainability of their environment to lower production cost. The respective governments, spurred by economic incentives, for a long time did not even attempt to mitigate the effects of these practices by enforcing stricter laws. With the TPP and the consequent access to more selective markets and educated consumers, these states were finally pushed to make concrete changes.
Malaysia, for example, has pledged for the first time to face its human trafficking crisis, specifically focusing on lowering the number of sex workers forced into indentured servitude. In 2014, the country was downgraded from Tier 2 to Tier 3 on the Trafficking in Persons report, indicating an increase in trafficking activities and failure on the part of the government to “make significant efforts to meet the minimum standards”. In response, Senator Bob Menendez added a provision in TPP legislation which explicitly stated that unless Malaysia cracked down on human trafficking, it would be excluded from the partnership, prompting the government to make amendments to the prosecution as well as victim protection system which officially went into force in November 2015. Similarly, the Sultan of Brunei, Hassanal Bolikah had to reconsider his plan of imposing conservative laws against gay people when the alternative was exclusion from the TPP. In Vietnam, TPP would have meant the implementation of the U.S.-Vietnam Plan for the Enhancement of Trade and Labor Relations which dictated that the Communist Party of Vietnam allow larger labor federations to be established within five years. To monitor the government’s compliance with the TPP’s labor chapter, a Labor Expert Panel was created, comprising of representatives from both countries. The Vietnamese government also had to upgrade its Biodiversity and Forest Protection laws to comply with what Hung Phan, deputy head of Legal Affairs Department termed “the largest and strictest environmental commitments” Vietnam has ever signed.” These commitments encompassed everything from protecting the ozone layer, preventing ship pollution and developing a low-emissions economy.
As negotiations continued and TPP partners worldwide drafted drastic legislative changes, developing states awaited eagerly for the economic boon that were promised them if they cast off their backwards, authoritarian mantra. The price for modernization was worth it–they would now be able to export their agricultural products to larger markets and import high-quality technology craft from developed nations. The millions of long-suffering citizens in Malaysia, Brunei, Mexico, Peru and Vietnam held their breath.
And then the U.S. withdrew from the deal. Of course, it is true that the U.S. is just one country, and as of now there has been talk among the eleven other members on moving ahead without the participation of U.S. However, according to the lead economist for trade and regional cooperation at the Asian Development Bank Jade Menon, it is extremely unlikely that weighing the pros and cons, other governments would be willing to sign the deal and commit to strict regulations on key aspects of their industries without the expected access to U.S. market. To worsen the situation, Japan officially stated that it would not consider the deal without the U.S. Together, these two countries made up 75 percent of the gross domestic product among member states.
Although the deal carried many benefits for everyone involved, the TPP is nowhere close to being perfect, especially to the U.S. where its implementation would have led to disadvantageous repercussions for a significant population demographic. America has made its choice according to what it deemed best for its people. Yet there is a somber finality to the conclusion of the “trade deal of the 21st century”, which had only a short time ago promised so much to developing nations on the other side of the globe.