Countries should forge more economic alliances than security and defense alliances because these could make the world “more dangerous”, the president of the Center for China and Globalization said on Tuesday.
It would also prevent a slide towards de-globalization, which could hamper economic development around the world. The United States, for example, could consider joining – or “rejoining” – the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), Henry Wang said at the SALT iConnections conference in Singapore.
“The United States is the mood of globalization and [has] always taken the lead in globalization,” Wang said.
“It was a shame to see the United States pull out of the [Trans-Pacific Partnership, which] … setting higher standards for global trade, including the digital economy, as well as trade liberalization and investment facilitation.”
Wang added that there should be more economic alliances and fewer security alliances such as AUKUS, Five Eyes and the Quadrilateral Security Dialogue, an informal strategic alliance.
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership is a multilateral trade agreement signed in 2018 after the United States withdrew, under the Trump administration, from the Trans-Pacific Partnership.
Claudio Reyès | AFP | Getty Images
“I hope the United States has now settled this middle ground, we can move towards economic and global alliances rather than having a lot of security, military and defense alliances which will make us more and more dangerous “Wang said.
The CPTPP was formerly known as the TPP, which was part of the United States’ economic and strategic pivot to Asia.
Former US President Donald Trump pulled the US out of the trade pact in 2017, after drawing criticism from the protectionist end of the US political spectrum.
The TPP has since evolved into the CPTPP after other members of the pact forged with it. It is now one of the largest trading blocs in the world, attracting contenders like China.
The United States has not indicated any desire to join the CPTPP. Instead, it launched its own separate network of non-trade relations with the Asia-Pacific, the Indo-Pacific economic framework.
Echoing Wang’s point, Nicolas Aguzin, CEO of Hong Kong stock exchange HKEX, said in the same panel that the globalization of trade has created many benefits, including bringing East and West closer together as one of the other.
“I mean, it had kept prices very low around the world in many areas; we had productivity,” he said, adding that he doubted deglobalization would ever happen, in light of the complex interdependence of global supply chains.
With the emergence of new powers, tensions are inevitable at this stage of globalization, Aguzin said.
“Asia, as a region, over the next 10 years we’re about half of the world’s production. I mean you’re going to have a tough time, because it’s a big change. There’s a big shift in power and influence from west to east,” he said.
Olympian style competition
Economic alliances and healthy “Olympic-style” competition between the United States and China would therefore be better than confrontation, Wang added.
Wang said notes from the Chinese Communist Party’s meeting in Beijing indicated that Chinese policymakers want “openness,” suggesting that Beijing is still eager to promote trade and multilateralism.
The appointment of new Cabinet members from developed regions of China, such as Guangdong and Jiangsu, suggests that Beijing has its sights set on more development, private enterprise and investment from multinational corporations, Wang said. .