Trade partnership talks between the EU and North America are a response to concerns about China's rising economic power, according to one international trade expert. A recent push towards trade negotiations between the North American Free-Trade Agreement countries, Latin American economies and EU members are aimed at increasing trade flows, and can also be viewed as “a defensive effort by the ailing advanced economies against the rising China and emerging Asia,” said Dr Dan Steinbock, a research director at the Georgia-based India, China & America Institute,, in his paper 'The Emerging US-EU-Asia Trade Triangle'.
Since February, representatives of the US and the EU have been working on the framework of the Transatlantic Trade and Investment Partnership (TTIP), a new free-trade zone which, when in force, will cover an area that generates 46% of the world's GDP. Additionally, the US is currently participating in the negotiations to create the Trans-Pacific Partnership (TPP), a 12-country trade bloc that includes many of the world's biggest economies, such as Japan, Mexico, Australia and Canada. On the top of that, in mid-October Canada and the EU signed the Comprehensive Economic Trade Agreement, a tentative deal to remove nearly all import taxes on goods sold between the two partners.
Although, as reported earlier this year, China is looking to join the TTIP talks, Mr Steinbock said that the TTIP and TPP are moving ahead without Chinese involvement. “The TPP excludes China and is – according to Chinese critics – an effort to contain China in a US pivot towards Asia. As with its counterpart, TTIP, the TPP talks have been conducted in secrecy,” said Mr Steinbock. He added that the timeframe for the talks is not accidental either. “All of these talks seek to achieve major results by the mid-2010s. It’s not a chance event. That’s when the renminbi is expected to become fully convertible,” he said.
For its part, China and its partners in the Asia-Pacific region are working on another free-trade agreement. The Regional Comprehensive Economic Partnership (RCEP), scheduled to conclude by the end of 2015, is intended to include an area inhabited by 45% of the world's population and one-third of its GDP. “These three deals... are shaped either by the US or China, but not both, as of yet,” said Mr Steinbock.
The emergence of new, competing trade blocks in the near future might bring frictions in trade and investment, but Mr Steinbock has claimed that in the long run, the outcome of the new agreements will be positive. "Over time, the TTIP, TPP and RCEP will boost regional and inter-regional integration, which can also shape complementary interests from Asia to the Americas,” he said.