As more nations aspire to join CPTPP, upholding agreement’s high standards is key

THE Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) – a mega free trade pact of which Singapore is a part of, along with 10 other nations around the Pacific Rim – endured a rocky beginning several years ago, but there are signs that it can set the gold standard when it comes to multilateral trade agreements.

The Trans-Pacific Partnership was pushed by United States President Barack Obama during his time in office until January 2017, but was thrown into disarray when his successor Donald Trump – in one of his first acts in the White House – yanked the world’s largest economy out of the agreement despite it already being signed. The remaining 11 members decided to carry on without the US, which led to the formation of the CPTPP.

Collectively, the CPTPP members represent about 13 per cent of global gross domestic product. The latest data shows that the pact has had a positive impact on trade and investment flows in the region. Intra-CPTPP trade increased by over 4 per cent to US$467 billion in the CPTPP’s first year in 2019, up from an average of US$448 billion for the 2010 to 2018 period. Intra-CPTPP digital services trade rose by 46 per cent to US$51.9 billion in 2019, up from an average of US$35.5 billion for the 2010 to 2018 period. CPTPP parties also saw their foreign direct investment inflows rise 10 per cent year-on-year to US$294 billion in 2019.