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Asean

The Trans-Pacific Partnership, the environment and climate change

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Author: Matthew Rimmer, ANU

The Trans-Pacific Partnership (TPP) is a sweeping, plurilateral free-trade agreement spanning the Pacific Rim.

The ongoing, secretive treaty negotiations involve Australia and New Zealand; countries from South East Asia such as Brunei Darussalam, Malaysia, Singapore and Vietnam; the South American nations of Peru and Chile; and the members of the 1994 North American Free Trade Agreement, Canada, Mexico and the United States. There has also been some discussion as to whether Japan should be included in the negotiations.

There has been much debate about the impact of this proposed treaty upon the environment, biodiversity and climate change. US Trade Representative Ron Kirk, has argued that the TPP will be a boon for the environment, but countries remain divided on the issue.

Mark Linscott, an assistant US Trade Representative, declared that ‘an environment chapter in the TPP should strengthen country commitments to enforce their environmental laws and regulations, including in areas related to ocean and fisheries governance, through the effective enforcement obligation subject to dispute settlement’.

Meanwhile, Inside US Trade has commented: ‘While not initially expected to be among the most difficult areas, the environment chapter has emerged as a formidable challenge, partly due to disagreement over the US proposal to make environmental obligations binding under the TPP dispute settlement mechanism’.

Australia has apparently voiced reservations about the US conservation proposal on grounds that it is overly prescriptive and fails to take into account individual variation in national laws. Australia is perhaps also concerned about preserving the precautionary principle under the TPP.

New Zealand has tabled a proposal on climate change in the TPP. A New Zealand trade official observed that ‘Climate change is one of the pre-eminent environmental challenges of the 21st century and, as a 21st century agreement, the TPP is well placed to be able to bring economic and environmental issues together in a way that seeks to make trade policy and environmental policy mutually supportive’. The proposal reportedly has two elements. First, New Zealand wants to include language stating that countries should try to phase out subsidies for fossil fuels. Second, the country has supported a non-binding affirmation of the benefit of pricing carbon in the text of the agreement. New Zealand hopes that such text would be an important step toward a regional carbon emissions trading system.

The New Zealand proposal has not found much favour with environmental groups. There has been criticism that the text is a ‘shadow solution’ — to use the philosophical discourse of Stephen Gardiner — because it only addresses the problem of climate change in a limited way. The concern is that including climate change provisions in the TPP may undermine or erode the 1992 United Nations Framework Convention on Climate Change, the 1997 Kyoto Protocol, and other ongoing multilateral negotiations over climate change.

Peru has also proposed text on climate change in the TPP, reflecting its policy to reduce carbon emissions. It is not clear where Australia stands in the debate over the TPP and climate change — especially in light of its package of reforms designed to promote a Clean Energy Future.

For their part, green political parties and civil society organisations have been concerned about the substantive implications of the treaty for the environment. The Green Party of Aotearoa New Zealand, the Australian Greens and the Green Party of Canada have released a joint declaration on the TPP, observing that ‘more than just another trade agreement, the TPP provisions could hinder access to safe, affordable medicines, weaken local content rules for media, stifle high-tech innovation, and even restrict the ability of future governments to legislate for the good of public health and the environment’. In the United States, civil society groups such as the Sierra Club, Public Citizen, the Friends of the Earth and the Rainforest Action Network have raised concerns about the TPP and the environment.

The TPP is an ambitious free trade agreement, with a far-reaching scope in respect of the environment, biodiversity and climate change. There has been much disquiet about the secretive nature of the negotiations thus far. The Green Party of Aotearoa New Zealand, the Australian Greens and the Green Party of Canada observe that ‘while representatives of AT&T, Verizon, Cisco, major pharmaceutical companies and the Motion Picture Association of America have access to the text, democratically elected members of parliament, advocacy organisations for healthcare and the environment and ordinary citizens are being left out in the cold’. Allison Chin, President of the Sierra Club, called the negotiation process ‘a stealth affront to the principles of our democracy’.

The texts of the TPP should be made public so that there can be a full and frank discussion of the impact of the proposed treaty upon conservation, biodiversity and climate change. The impact of the TPP upon the environment of the Pacific Rim must be evaluated in a transparent manner, following due process and inviting public participation.

Matthew Rimmer is an Australian Research Council Future Fellow working on intellectual property and climate change, and an Associate Professor at the ANU College of Law, Australian National University.

Asean

ASEAN weathering the COVID-19 typhoon

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Vietnam's Prime Minister Nguyen Xuan Phuc addresses a special video conference with leaders of the Association of Southeast Asian Nations (ASEAN), on the coronavirus disease (COVID-19), in Hanoi 14 April, 2020 (Photo:Reuters/Manan Vatsyayana).

Author: Sandra Seno-Alday, Sydney University

The roughly 20 typhoons that hit Southeast Asia each year pale in comparison to the impact on the region of COVID-19 — a storm of a very different sort striking not just Southeast Asia but the world.

 

Just how badly is the COVID-19 typhoon thrashing the region? And what might the post-crisis recovery and reconstruction look like? To answer these questions, it is necessary to investigate the strengths and vulnerabilities of Southeast Asia’s pre-COVID-19 economic infrastructure.

Understanding the structure of the region’s economic house requires going back to 1967, when Southeast Asian countries decided to pledge friendship to one another under the ASEAN framework. While other integrated regions such as NAFTA and the European Union have aggressively broken down trade barriers and significantly boosted intra-regional trade, ASEAN regional economic integration has chugged along slower.

Southeast Asian countries have not viewed trade between each other as a top priority. The trade agreements in the region have been forged around suggestions for ASEAN countries to lower tariffs on intra-regional trade to within a certain range and across limited industries. This has lowered but not eliminated barriers to intra-regional trade. Consequently, a relatively significant share of Southeast Asian trade is with countries outside the region. This active extra-regional engagement has resulted in ASEAN countries’ successful integration into global value chain networks.

A historically outward-facing region, in 2010 around 75 per cent of Southeast Asian commodity imports and exports came from countries outside of ASEAN. This share of extra-regional trade nudged closer to 80 per cent in 2018. This indicates that ASEAN’s global value chain network embeddedness has deepened over time.

Around 40 per cent of ASEAN’s extra-regional trade is with the rest of Asia. From 2010 to 2018 Southeast Asian countries forged major trade relationships with four Asian countries: China, Japan, South Korea and India. Outside Asia, the United States is the region’s major trading partner. ASEAN’s trade focus on Asia’s largest markets is not surprising. Countries tend to establish trade relationships with large, geographically close, and culturally similar markets.

Fostering deep relationships with a few large markets, however, is a double-edged sword. While it has allowed ASEAN to benefit from integration in global value chains, it has also resulted in increased vulnerability to the shocks affecting its network connections.

ASEAN’s participation in global value chains has allowed it to transition from a net regional importer in 1990 to a net regional exporter in 2018. But the region’s deep embeddedness in a small and tightly-coupled network cluster of extra-regional global value chain partners has exposed it to disruption to any and all of its external partners. By contrast, ASEAN’s intra-regional trade network structure is much more loosely-coupled: a consequence of persistent intra-regional trade barriers and thus lower intra-regional trade intensity.

In the pre-COVID-19 period, ASEAN built for itself an economic house held up by just five extra-regional markets, while doing less to expand and diversify its intra-regional trade network. The data shows that ASEAN trade became increasingly concentrated in these few external markets between 2010 and 2018.

This dependence on a handful of markets does not bode well for risk and crisis management. All of the region’s major trading partners have been significantly affected by COVID-19 and this in turn is blowing the ASEAN economic house down.

What are the ways forward? The immediate task at hand is to get a better picture of the region’s position in global value chain networks and to get on top of managing its network risk exposure. Already there are red flags around the region’s food security arising from its position in food value chains. It is critical to look for ways to introduce flexibility into existing supply chains for greater agility in responding to crises.

It is also an opportune time for ASEAN to harness the technology transfer gains of global value chain participation and invest in innovation-driven diversification of products and markets. The region’s embeddedness in global value chain networks certainly places it in a strong position to readily access large export markets not just in Asia but also Europe and the Americas.

Over the longer term, ASEAN is faced with the question of whether it should seriously look…

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Markets

Tiger Trade Launches SGX Trading, Meeting Demand from Asian Investors

Access to the Singapore Exchange (SGX) adds to Tiger Brokers’ current menu of stock exchanges, such as the New York Stock Exchange (NYSE) and the Nasdaq Stock Market (NASDAQ), the world’s two largest stock exchanges, as well as the Hong Kong Stock Exchange (HKEX).

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SINGAPORE (ACN Newswire) – Tiger Trade, a one-stop mobile and online trading application by Tiger Brokers, has launched access to the Singapore Exchange (SGX).

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Asean

Can Asia maintain growth with an ever ageing population ?

To boost productivity in the future, Asian governments will have to implement well-targeted structural reforms today.

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Asia has been the world champion of economic growth for decades, and this year will be no exception. According to the latest International Monetary Fund Regional Economic Outlook(REO), the Asia-Pacific region’s GDP is projected to increase by 5.5% in 2017 and 5.4% in 2018. (more…)

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