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High hopes for landmark trade pact

The Trans-Pacific Partnership has a good chance of getting ratified in the US despite being opposed by presidential candidates in the country.

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Mr Negroponte (right) with Jose Isidro Camacho, vice-chairman, Asia-Pacific & country CEO Singapore, Credit Suisse, at the conference.

DESPITE the opposition against the Trans-Pacific Partnership (TPP) in the United States, the trade pact still has a chance to be ratified, said a former senior US diplomat. Candidates of the upcoming US presidential elections have spoken out against globalisation and free trade agreements that they believe take away jobs from the US.

"Notwithstanding the negative rhetoric of the candidates, I don't think the TPP is dead," said ambassador John Negroponte at the Credit Suisse Global Megatrends Conference 2016 in Singapore yesterday. "We have a window during the lame duck (period) after our elections and before the new Congress takes office for getting the TPP ratified. I think there is a good chance we could get this done."

The career diplomat was the US ambassador to Honduras, Mexico, the Philippines, the United Nations and Iraq, as well as first director of National Intelligence under President George W Bush.

The TPP is a trade agreement among twelve Pacific Rim countries signed on Feb 4, 2016 in Auckland, New Zealand, after seven years of negotiations. Among other things, the TPP contains measures to lower trade barriers, such as tariffs, and establish an investor-state dispute settlement mechanism. The agreement has not entered into force.

Mr Negroponte said that past free trade agreements have been passed in the US despite swirling with controversy, most notably the North American Free Trade Agreement (Nafta) between Canada, the United States and Mexico that passed in 1994.

US-China relations

Mr Negroponte also said that China-US relations is one of the most important geopolitical and economic issues of our time, and that the next US president would have to manage that relationship in a positive fashion.

"The US may no longer be the sole remaining super power but we are still an indispensable nation. It is hard to get things done internationally without the involvement of the USA, but we are going have to do it more in partnership with other countries," he said.

"Certainly one country we have to work hard with is the country of China - and manage all the complexities of that relationship. We have to find areas of cooperation not withstanding the occasional point of friction between us."

One potential point of friction is the ongoing territorial dispute in the South China Sea between China and various South-east Asian countries. In a show of support to its allies in the region, US Defense Secretary Ashton Carter earlier this month visited two aircraft carriers in Asia, and unveiled new military agreements with India and the Philippines.

"We do urge that these problems be resolved by peaceful means. It seems to me that any type of friction that escalates to conflict is going to jeopardise this Asian economic miracle that is taking place," said Mr Negroponte. He does not see the dispute escalating to a military conflict between China and the US as "this would be catastrophic".

US elections

On the upcoming presidential elections in the US, Mr Negroponte believed that it was safe to make a "working assumption" that Republican Donald Trump and Democrat Hillary Clinton are going to be the nominees for their respective parties.

The pair recently scored victories in nominating contests in their home state of New York. The eventual victors of the Democratic and the Republican nominating campaigns will face each other in November's general election. As campaigning for the general election begins, the former ambassador believed that the aggressive tone and rhetoric of the candidates would moderate, especially from Mr Trump.

"They may go after each hammer and tongs but on the issues, there could be a toning down. You are not going to hear some of the things that you have heard before," he said.

On the outgoing US president Barack Obama, Mr Negroponte said that while he has done a good job managing the economy, his record on foreign policy is patchy.

"On foreign policy, he has a mixed record. He saw a ratification of a number of important free trade agreements and improved relations with South-east Asian countries . . . (but) he's handing over some intractable problems to whoever succeeds him, mainly in the Middle East," he said.

He described Mr Obama as a "reluctant" foreign policy practitioner, and believed that if Mrs Clinton were to win the presidency, she would be much more pro-active in this area.

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