For example, while Indian agriculture is frequently asserted to have suffered in the wake of the ASEAN agreement, a quick glance at the tariff schedules for India under the deal shows clearly that most key items, including apples, were placed on the exclusion list (EL). This means that the ASEAN-India (AIFTA) agreement made no changes to existing tariffs. The 50% tariff on apples into India from 9 ASEAN member states still exists—even after full implementation of AIFTA. Philippines has a separate tariff schedule with India in AIFTA and apples are also on the EL. Apple exports from ASEAN to India may have grown in the wake of AIFTA, but it was not as a direct result of any changes to tariff levels in the agreement. Hence AIFTA cannot be blamed as a cause of competitiveness problems in India’s apple orchards.
The Financial Times has reported that the UK’s Department of International Trade has begun circulating a proposal for the UK to join the Trans-Pacific Partnership (TPP) trade agreement. There are at least four issues to be addressed: 1) Why would the UK want to join the TPP? 2) Does the TPP even allow the UK to join in the first place? 3) Why would the TPP members want the UK? 4) Is it possible to make a deal happen and when?
The imposition of restrictions on the movement of information, particularly financial data or personal data, also risks changing the landscape. I could not have booked my hotels or paid for my car rental, if I had been unable to move my own data across borders. Yet governments are increasingly interested in stopping exactly these types of transactions. Not simply to keep me from traveling, of course, but a collateral impact of many poorly thought-through policies will be to hamper the freedom of consumers to operate globally and for firms to attract customers from anywhere. Even restrictions on the location of data servers could impact my ability to book hotels in Greece. It could easily drive up the costs of delivering services and make it too costly for some smaller firms, like tiny hotels in Arachova, to advertise on some sites.
Having agreements that may not apply to all members also makes using the final agreements trickier for companies. The main reason for negotiating trade rules in the first place is to create common practices for businesses to help reduce risk and uncertainty in the trade environment. However, as the WTO has gotten bigger and as some members have grown bolder in their obsession with using the consensus principle as a means for blocking all actions, the institution has clearly gotten bogged down. One way to move forward is to allow smaller groupings to proceed with issues that matter to them. This process is now, apparently, going to begin again at the WTO. First on the agenda is the start of a possible work program on electronic commerce, supported by about 70 members.
November 2017: This is an updated version of an earlier post on Talking Trade, modified to reflect the TPP11 changes and the expansion of the agenda in RCEP. However, because RCEP, especially, remains under negotiation, the assessment should be viewed with some caution. For further discussion on how you can use or influence these agreements, please see us soon at the Asian Trade Centre.