Academic journal article The Economic and Labour Relations Review : ELRR

The Trans-Pacific Partnership Agreement: Contradictions in Australia and in the Asia Pacific Region

Academic journal article The Economic and Labour Relations Review : ELRR

The Trans-Pacific Partnership Agreement: Contradictions in Australia and in the Asia Pacific Region

Article excerpt

Introduction

The Trans Pacific Partnership Agreement (TPPA) is being negotiated between Australia, the United States, (US), Chile, Peru, Brunei, Singapore, New Zealand, Vietnam and Malaysia. The current target for conclusion of the negotiations is November 2011.

This analysis of the TPPA combines the conceptual approach to trade agreements developed by Cox, Busch and Milner's concepts of regionalism and Weiss and Thompson's analysis of specific historical state development strategies. This approach seeks to explain the origins of, and changes in, trade institutions and government policies through a critical analysis of their social origins and histories, and the power relationships between their advocates and critics. This involves analysis of different interests of classes and social forces and their relationship to governments and other state institutions. These forces include corporations and business organisations on the one hand, and organisations like unions and community groups which seek to defend the interests of the less powerful, on the other. State institutions at national and international levels are influenced, but not simply determined by, dominant economic interests. Institutions also develop their own histories which in turn influence the development of policies, which can persist despite changes of government. State policies can reflect the outcomes of contests between social forces (Cox 1994).

The demise of Cold War polarisation enabled the consolidation of global production systems in three economic macro regions, dominated by the most powerful states. These were the Americas, centred on the US; Europe, centred on a united Germany and the European Union; and Asia previously centred on Japan, and now increasingly on China. Bilateral and regional trade agreements in this context enable transnational corporations to achieve regional economies of scale in investment, and access to raw materials and markets, while still seeking access to global markets (Busch and Milner 1994).

Transnational corporations are powerful influences on states, pressing for global and regional regulatory frameworks and policies that will create a favourable environment for their global trade and investment strategies. However, the establishment of global, regional and bilateral trade agreements which can change national forms of regulation is not a simple process of reducing the role of nation states in relation to global corporations and institutions. States are the main actors in trade negotiations. The most powerful states like the US seek to use aspects of their national legal frameworks as the model for legally enforceable global or regional regulation through trade agreements. State models of regulation also differ because of different specific histories. The European model of regulation and of trade agreements has been more interventionist about labour regulation and social service provision because of the relative strength of the labour movement in key European countries. Some Asian models of economic development (Japan, South Korea, Taiwan) have relied extensively on state intervention to assist industrial investment (Weiss and Hobson 1995).

States may respond to national resistance to trade agendas by attempting to mediate the effects of international regulation on what are still national political constituencies. This resistance and differing state responses arise because trade agreements not only deal with reductions in tariffs (taxes on imports), but now seek to apply global trade rules to many areas previously regarded as the domain of national government regulation. These include access to medicines, water services, financial services, cultural policies, quarantine, food regulation, government purchasing and environmental policies. These new forms of legally binding global regulation attempt to internationalise previous national state functions, effectively removing key aspects of policy from national democratic pressures. …

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