MNI INTERVIEW:China May Join CPTPP Under Biden, Speed EU Talks

China should seek to join the 11-nation CPTPP Asia-Pacific trade agreement and enact market-oriented reforms if the U.S. enters the pact under a future President Joe Biden, a senior Chinese foreign policy advisor told MNI.

In response to a more multilateral approach under the next U.S. administration, Beijing should also accelerate the negotiation of the China-EU Investment Agreement as well as the Regional Comprehensive Economic Partnership with countries in the Asia Pacific region, said Wang Huiyao, the founder of Center for China and Globalization and an advisor to the State Council.

Both China and the U.S. could start negotiations to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership after Biden takes office, Wang said. China is now open to possible reforms of its regulations of state-owned enterprises and data management, he continued, adding that the Phase One trade deal signed with the U.S. has helped in making improvements in such areas.

"The odds against China joining the CPTPP are not as high as before, as China has made significant improvement in intellectual property and environmental protection," said Wang. "China is not that far away from meeting the CPTPP standards, even Vietnam can join the pact."

SEEK IMPROVED TIES

The CPTPP, which groups Japan with Australia and New Zealand together with countries in Asia and North and South America, was first known as the Trans-Pacific Partnership and was originally signed by the U.S., but President Donald Trump pulled the country out of the pact in 2017.

With Biden likely to seek to strengthen alliances as the U.S. deals with China, Beijing should also seek to improve ties with the E.U., Japan, Australia, the U.K. and Canada, Wang said.

"These allies also have interests in China and are among the biggest trading partners of China," Wang said, noting that it remains to be seen how successful the U.S. will be in forging common positions over China amongst its allies. A China-EU deal could be concluded in the next two months, he said.

To help improve its international position, China should also play a more active role in global governance and open more space for cooperation in addressing issues like the Covid-19 pandemic, climate change and WTO reforms.

A G10 initiative, grouping China with G7 countries together with India and Russia, could channel efforts against the virus, along the lines of the global cooperation during the 2008 financial crisis.

"Around 80 to 90% of vaccine manufacturing capacities are in these countries," Wang said, adding that the mechanism could also work to address other agendas such as climate change, as the same group of countries is responsible for much of global carbon emissions.

WTO REFORMS

Wang expects stalled efforts to reform the World Trade Organization to be reactivated with the participation of the U.S. under Biden, with Washington "at least not blocking the appointment of a new director general".

The U.S. may continue to pressure China to give up its "developing country" status, Wang said, though he argued that this currently only provides the country with limited privileges.

U.S.-China competition in the area of technology will persist, but may become more orderly under Biden, Wang said.

"Competition is not a bad thing. The whole world cannot count on the U.S. to innovate…...the competition can promote each other," Wang said.