As the chief negotiators meet again this week in Hawaii, one issue needs to move quickly up the list of priorities—setting up the right institutional framework for the Trans-Pacific Partnership (TPP). The TPP requires a robust Secretariat to ensure the long-term health and success of this trade agreement.
This is not a topic that excites very many people. Everyone is much more interested in discussing what is or is not included in the agreement, getting the deal done, and discussing the timing of it all. Yet if the right framework is not chosen for the TPP as a whole, the entire agreement will swiftly fade into irrelevance. More than 5 years worth of hard bargaining could be lost along with most of the promises of future benefits.
Oddly, this is one area where people outside the trade and diplomatic universe have a much better grasp of the issue than officials. Whenever I describe the implementation and enforcement challenges to business leaders or the general public, people immediately understand that it is not possible to keep track of an agreement that binds together 12 members in three continents at diverse levels of economic development without some sort of robust management system.
The option currently on the table in the TPP consists of a set of standing committees, similar to what has been used in different bilateral trade agreements in the past.
Yet anyone who has ever worked in a large business or volunteer organization immediately grasps the problem of leaving important tasks to a committee. Not all committees are hopeless, of course. But the success of many committees relies on finding committed and determined individuals who have (or create) the time to focus relentlessly on committee tasks.
This single-minded attention to detail is unlikely to be found among the mostly overworked desk officers of the current TPP members. Dumping implementation monitoring and future tasks on the shoulders of the Asia desk trade officials is more likely to be a recipe for drift.
The first phase of TPP implementation will stretch to more than a decade, with constantly shifting commitments every year for each member. Just keeping an eye on the promises made by different countries and ensuring that these commitments are properly implemented across 29 different chapters is not going to be easy.
Under most trade agreements, changes and monitoring are set to take place in various committees—for goods, services, etc. as well as an overall coordinating committee group. But even in most regular deals, the committee structure rarely works as promised. The groups do not meet as originally planned. National level trade desk officers in charge of attending the committees do not really have time to pay attention to the agreement in between review periods at all.
The reality is that very little change ever happens in the review sessions. To even get members in a bilateral agreement to make a change often requires parties to agree on a protocol of amendment in the first place. No good bureaucrat is likely to argue for drafting a new protocol of amendment unless the issue under discussion is extremely critical.
So existing agreements quickly get out of date. This is not supposed to happen in the TPP, because it is meant to be a “living agreement.” (More on this idea in a future post.) But without a dedicated group of people monitoring the deal, it is not at all likely that the TPP will actually be amended as necessary over time.
For these reasons alone, the TPP needs a standing Secretariat to keep track of the agreement.
But the argument for a specialized set of experts to manage the agreement gets even more compelling when you realize the TPP is supposed to expand again in the near-term. The current teams of negotiators are likely to be disbanded as soon as the TPP agreement is concluded. Many of these folks will be heading off to a well-earned retirement or new careers entirely after five grueling years of continual travel and hard bargaining.
There are already a number of countries like South Korea, Taiwan, Columbia and the Philippines that have expressed interest in joining the TPP as soon as possible. By 2018, the TPP could have 19 countries working together to craft accession terms and market access commitments. Managing all these diverse interests will require a dedicated Secretariat.
There have been some muted calls to let the current APEC Secretariat handle the task. The TPP is officially one of the pathways to the Free Trade Area of the Asia Pacific (FTAAP) that will bring together all 21 APEC economies. But the current APEC Secretariat is not in a position to manage the legally binding TPP commitments very well among a subset of its members and still manage to complete its own full slate of activities.
It seems clear that the TPP requires a dedicated Secretariat. Current negotiating members are not enthusiastic about this idea, as it requires deciding on budgets, staffing and the identification of a suitable host. But in the absence of a Secretariat, it is likely that many of the benefits of the TPP will be lost or will not be fully exploited. It would be a shame to finally get a deep, broad and important agreement completed and watch it crumble for want of a decent institutional framework.
*******Talking Trade is a blog series by Deborah Elms, Executive Director, Asian Trade Centre, Singapore******