Vietnamese Income (GDP Growth, 2010-2015)

TPP: The Trans-Pacific Partnership and Asia-Pacific Integration: A Quantitative Assessment

Peter A. Petri, Brandeis Univeresity“Vietnam would be the largest beneficiary on the TPP track. Participation would increase Vietnam’s GDP by 13.6% compared with the “baseline scenario.” Five factors explain this result: strong trade with the United States; high protection abroad against apparel and footwear, which are Vietnam’s principal exports; strong competitive positions in these and othe manufacturing industries where China’s comparative advantage is fading; high initial domestic protection; and powerful scale effects in Vietnam’s principal production clusters. The first three factors boost Vietnamese exports and terms of trade under the TPP. The last two amplify these benefits by stimulating productivity gains. Higher incomes in turn enable Vietnam to invest more and grow more rapidly. Of course, Vietnam would face significant challenges in implementing an agreement that requires stringent disciplines in areas such as labor and government procurement. It also faces tough challenges in maintaining a macroeconomic environment that permits adjustment and encourages long-term investments. But overall, Vietnam’s participation in the agreement is well founded.” Pages 81-82

The Trans-Pacific Partnership and Asia-Pacific Integration: A Quantitative Assessment
Peter A. Petri, Michael G. Plummer, and Fan Zhai
December 2012
presentation   | video

Policy Analysis 98: The Trans-Pacific Partnership and Asia-Pacific Integration: A Quantitative Assessment, provides the most extensive analysis to date of the likely economic impact of both the TPP and the numerous Asia-only agreements that are already in place or under simultaneous consideration.  It also analyzes the effect of possible eventual amalgamation of these “Pacific track” and “Asia track” arrangements into a comprehensive Free Trade Area of the Asia Pacific, the stated goal of the TPP participants, which would represent ultimate realization of the “Bogor goals” adopted by APEC in 1993–94.

While global trade negotiations remain stalled, two tracks of trade negotiations in the Asia-Pacific—the proposed Trans-Pacific Partnership (TPP) agreement and a parallel Asian track—could generate momentum for renewed liberalization and provide pathways to region-wide free trade. This book investigates what these trade negotiations could mean to the world economy. Petri, Plummer, and Zhai estimate that world income would rise by $295 billion per year on the TPP track, by $766 billion if both tracks are successful, and by $1.9 trillion if the tracks ultimately combine to yield region-wide free trade. They find that the tracks are competitive initially but their strategic implications appear to be constructive: the agreements would generate incentives for enlargement and mutual progress and, over time, for region-wide consolidation. The authors conclude that the crucial importance of Asia-Pacific integration argues for an early conclusion of the TPP negotiations, but without jeopardizing the prospects for region-wide or even global agreements based on it in the future.

The Trans-Pacific Partnership and Asia-Pacific Integration: A Quantitative Assessment
Peter A. Petri, Michael G. Plummer, and Fan Zhai
December 2012
presentation   | video  | book

“Vietnam would be the largest beneficiary on the TPP track and of an Asia- Pacific-wide agreement. Five factors explain this result: strong trade with the United States; high protection abroad against apparel and footwear, which are Vietnam’s principal exports; strong competitive positions in these and othe manufacturing industries where China’s comparative advantage is fading; high initial domestic protection; and powerful scale effects in Vietnam’s principal production clusters. The first three factors boost Vietnamese exports and terms of trade under the TPP. The last two amplify these benefits by stimulating productivity gains. Higher incomes in turn enable Vietnam to invest more and grow more rapidly. Of course, Vietnam would face significant challenges in implementing an agreement that requires stringent disciplines in areas such as labor and government procurement. It also faces tough challenges in maintaining a macroeconomic environment that permits adjustment and encourages long-term investments. But overall, Vietnam’s participation in the agreement is well founded.” Pages 81-82

Vietnamese Income (GDP Growth, 2010-2015)

“Getting to yes: Domestic politics and the TPP Vietnam’s political system differs from that of the United States but domestic issues will also have a large impact there. State-owned enterprises play an important role in the economy and could face significant adjustments under the competition policy chapter. (Singapore’s large government-owned investment company Temasek has also opposed additional disclosure rules.) Labor provisions calling for “freedom of association” would be difficult to reconcile with Vietnam’s single, state-sponsored labor union. Producers in several industries worry that the TPP’s environmental provisions could raise costs. As the country with the lowest per capita income in the TPP, Vietnam hopes for “special and differential treatment,” but the TPP is unlikely to include such provisions. Vietnam is projected to gain the most from the TPP and has shown flexibility on difficult issues. Much will depend on whether provisions affecting its critical textile and apparel exports are favorable enough to justify hard concessions. Pg 74

Results for U.S., China, Vietnam, APEC, World

Read more …

Trans-Pacific Partnership Negotiations: Issues for the U.S. Congress, Congressional Research Service, Jan 24, 2013

Trans-Pacific Partnership (TPP) Countries: Comparative Trade and Economic Analysis, Congressional Research Service, Jan 29, 2013

Understanding the Trans-Pacific Partnership, Jeffrey Shott, et. al., Dec 2012
slide presentation  | video  | Sticking Points in the TPP Negotiations

The Trans-Pacific Partnership and Asia-Pacific Integration: A Quantitative Assessment, Peter Petri, et. al., Dec 2012
slide presentation #1   | slide presentation #2 (benefits to Vietnam, U.S., China) | video

Panel Discussion and Q&A: Fred Bergsten, Jeffrey Schott, Peter Petri, Dec 19, 2012 video

Coming soon  …

Mar 4-13, 2013. The 16th round of the Trans-Pacific Partnership (TPP) negotiations will take place at the Grand Copthorne Waterfront Hotel in Singapore from March 4-13, 2013.  Registration is now open for TPP stakeholders interested in participating in stakeholder events.

The TPP Stakeholder Programme will take place on Mar 6. The organizers will accommodate stakeholders that wish to make presentations. With this, stakeholders now have an expanded range of options for engaging negotiators and other stakeholders. Those who wish to, can make presentations and/or request tables to display TPP-relevant collaterals, both on a first-come-first-served basis. Stakeholders who do not wish to make presentations, are still welcome to register and enjoy the same opportunity to engage negotiators and other stakeholders.

Posted: Feb 24, 2013. Updated: Mar 2, 2013.