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June 13 — Asia-Pacific trade talks taking place in Auckland this week offer an important opportunity to shape regional trading rules, according to New Zealand's top trade official.
Like the Trans-Pacific Partnership (TPP) agreement, the Regional Comprehensive Economic Partnership (RCEP)—which includes China—would help determine the way countries in the region do business with each other, New Zealand Trade Minister Todd McClay told Bloomberg BNA during a June 10 telephone interview.
McClay also said he is confident that U.S. politicians are weighing their country's role in the evolution of regional trade links as they decide whether to ratify the TPP, adding that he's “very confident” the U.S. will ratify the deal.
“Certainly TPP allows all 12 countries to sit around the table and help shape the rules that will decide trade in the Asia-Pacific [region] going forward,” he said.
“RCEP provides an opportunity to also think about these regional rules,” said McClay, whose government is hosting the latest negotiating round June 12-18 for RCEP, a trade alliance that includes China, but not the U.S. Other RCEP participants comprise India, Japan, South Korea, Australia, New Zealand, and the 10 economies in the Association of Southeast Asian Nations (ASEAN). The agreement represents 3 billion people in 16 countries.
“I know some of our friends and colleagues in the U.S. are considering their place in that,” he said.
McClay said the absence of the U.S. and presence of China in RCEP talks hasn't presented any unique difficulties or opportunities.
“New Zealand has a very good and friendly relationship with both China and the U.S., and from a trade point of view both countries are very important to us,” he said, noting that New Zealand had been the first to negotiate a free trade agreement with China.
“I don't think that because one is in or one is out it creates greater opportunity or advantage, or poses any challenge,” he said. “We will continue to work through the RCEP negotiations with all of the countries involved.”
McClay said the TPP agreement had allowed RCEP economies “to contemplate what's possible” in trade talks.
“What I take from the considerable achievement of the TPP is that where a group of countries work hard together and focus on meaningful liberalization, … economies can and do grow,” he said.
Despite the overlap between RCEP and TPP participants, there are differences in their stages of development and integration, he said.
Consequently, “it's not just a matter of saying: `Well here is TPP let's adopt everything in it,’ ” he said.
As for his take on whether the U.S. is likely to approve the TPP, McClay said, “I am very confident that the U.S. will ratify the TPP, but they are going to have to take their time and work out the best time to do that.”
McClay indicated that, despite “good progress,” the RCEP negotiations might not be completed by the end of the year, as leaders had hoped.
The end-of-year time frame “is certainly something we are all working to,” he said. “Whether that is possible or feasible or not we will have to see.”
New Zealand, for one, won't be willing to sacrifice quality for speed. “We should continue to focus on the timing our leaders have set, but quality is more important than timing,” McClay said.
Various countries will be making offers on goods at the Auckland talks. “It will be important to work through those,” he said.
“A number of the offers will be of the quality that is desirable, others may need some work. There will be some who continue to need to consider their offers.”
RCEP negotiations were formally launched in November 2012 at the ASEAN Summit in Cambodia.
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