Foreign Policy: New Silk Road Strategy is China’s answer to TPP

Posted on : 2014-11-12 16:05 KST Modified on : 2019-10-19 20:29 KST
China to use partnership to expand China’s economic and diplomatic influence throughout Asia and into Europe

China’s real answer to the Trans-Pacific Partnership (TPP) that the US is promoting is not the Free Trade Area of the Asia-Pacific (FTAAP) but rather the New Silk Road Strategy, US magazine Foreign Policy argued on Nov. 10.

On Nov. 8, Chinese President Xi Jinping invited the leaders of countries who are not members of APEC (Asia Pacific Economic Cooperation) to Beijing for a meeting where he announced that China would be using the Silk Road Fund, worth US$40 billion, to promote the construction of basic infrastructure, development of resources, and financial cooperation in Central and Southeast Asia.

The plan is aimed at expanding China’s economic and diplomatic influence throughout Asia and into Europe through the maritime and overland Silk Road. In contrast, the US hopes to quickly reach an agreement on the TPP, a free trade zone that would span twelve countries in the Asia and Pacific regions.

The Silk Road strategy appears to be more clearly opposed to the TPP than the FTAAP, Foreign Policy explained. It also is a better fit for China’s plan to become the dominant country in the Asia-Pacific region.

For example, where the TPP emphasizes “high standards in market liberalization and openness,” the concept of “standards” is not even a part of the Silk Road strategy. The TPP focuses on reducing and limiting the role of governments and state-owned enterprises (SOE) in the region, but the projects that are proposed under the Silk Road strategy would demand intergovernmental cooperation or be led by large SOEs.

In contrast with the TPP, which places a premium on the service industry, intellectual property rights, and domestic regulations, the Silk Road strategy is more concerned with energy transport and relocation of manufacturing sectors.

According to Foreign Policy, the US expects that China will be seriously affected if the TPP is launched without China taking part as is currently planned. Either China will be excluded from the Asia-Pacific market by the stringent labor and environmental standards that will be applied as part of the agreement, or China will be forced to join the TPP and implement a more open economy, US officials believe.

The magazine also said that the countries neighboring China hope that China will show restraint in its territorial disputes with them after the TPP takes effect.

Nevertheless, there is virtually no evidence that China will act in accordance with these expectations, the magazine said. Indeed, by advancing the Silk Road strategy, China seeks to create a system that is centered on itself.

“Chinese political thinkers also see the TPP as an enterprise with the potential to weaken China economically and politically,” the magazine said. “For the real battle for influence over global trade, look to China’s new Silk Road strategy.”

 

By Park Hyun, Washington correspondent

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