New Publication: Policy Brief "The EU/Japan EPA - taking stock and looking ahead"
Read the policy brief in full.
The world has been through different stages of trade negotiations during the last decade. With the fundamental insight that the world trade order in the wake of the Doha round stalled, countries and established trading areas such as the EU looked for more constructive solutions to bring trade forward. Before the Trump administration took office, the EU and the US were negotiating the Transatlantic Trade and Investment Partnership (TTIP). In the Pacific, the US was engaged in negotiations on the Trans-Pacific Partnership Agreement (TPP) framework, capturing most trade outside China. With the Trump administration, the US view on trade relations and trade negotiations changed drastically. With the US currently withdrawn from both the TTIP and the TPP negotiation frameworks but with the UK applying to join the ‘replacement version’ of the TPP called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the playing field of international political economy and trade relations is profoundly altered. In the wake of the post-Trump position of the US and continuing tense relations with China, the world has rapidly seen geoeconomics as a new field with strong repercussions on the international political scene.
There has been an intense debate involving both academia and policymakers on the benefits from seeking what is often seen as the second-best alternative to multilateral solutions. Regional/plurilateral trade agreements are examples of such alternatives (e.g. Kawai and Wignaraja, 2008; Wilson, 2015; Solís and Wilson, 2017). A dividing line has been drawn between multilateralism as the only sustainable long-term alternative and the more pragmatic view of regional trade arrangements. These arrangements can be seen as incremental approaches towards successful multilateralism. This has resulted in the ‘stumbling block’ vs. the ‘stepping-stone’ metaphor (Alvstam and Nakamura, 2015). In recent years, there has been a process of conversion between the two attitudes, arguing that regionalism and plurilateralism can be multilateralised. This can be understood as regional and plurilateral trade arrangements which obey the general multilateral basic rules and in addition are also able to proceed further than is possible at the WTO level. Eventually, this might increase the possibility of reaching a successful multilateral agreement (Ibid.).
Nevertheless, various preferential agreements have become parts of a larger geopolitical, geoeconomic and security policy context, where trade has become a token of a lack of political intentions and political will. Therefore, with this backdrop there is an increasing need to view trade negotiations in a multidisciplinary synthesis of economics and politics, where influential stakeholders, such as governments and transnational corporations (TNCs), can utilise the playing field to sustain a rules-based framework towards a multilateral trade order.