China has now formally applied to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership trade pact. The country apparently wants to take the lead in trade and investment in the Asia-Pacific in place of the U.S., which withdrew from what was then called the Trans-Pacific Partnership before it was finalized.
But is China, a country defined by communist authoritarianism and mixed state capitalism, prepared to accept the high level of liberalization demanded by the CPTPP? The current 11 member countries must fully determine the sincerity behind China's request.
Chinese President Xi Jinping has made clear for some time that Beijing is interested in joining the pact. The timing of the application seems aimed at countering efforts by the administration of U.S. President Joe Biden to form a stronger international coalition against China. Chinese leaders also likely want to prevent Taiwan from joining.
The CPTPP requires a great deal of liberalization in trade and investment, and it has strict rules regarding the protection of intellectual property rights and the transparency of data flows. With Beijing tightening its grip on economic activity, China is unlikely to accept the reforms fundamental to meeting these standards.
Entry to the pact requires the approval of all 11 members, but some have reservations about welcoming China. For example, Australia’s relationship with the Asian economic giant has grown strained in recent years.
Japan, another member, is stepping up its security cooperation with the U.S. in the Indo-Pacific, and it will naturally be cautious about China joining.
Beijing's first priority should therefore be to build trust with other members. It can do this by ensuring that the Regional Comprehensive Economic Partnership, another trade agreement in East Asia and of which China is a member, is up and running from January as planned.
To be clear, expanding the CPTPP itself is the right move. Member countries should thus promptly conclude accession negotiations with the U.K. and encourage Thailand, South Korea and other nations to join. However, any new members must accept the current level of liberalization in the trade pact.
The CPTPP member countries should consider allowing China's entry only if it is willing to accept the same conditions as these countries and undertake the necessary reforms. Xi needs to present a credible plan for implementing these measures.
The U.S. is reluctant to return to the CPTPP, and Beijing undoubtedly wants to capitalize on Washington's absence. America's allies, including Japan, should leverage their close ties with Washington to encourage the U.S. to come back to the accord.