Usage rates of Asia’s PTAs are low, both in absolute terms and in comparison to those for such agreements in other parts of the world. Moreover, if business were to become more interested in utilizing these arrangements, it would run up against the ‘noodle bowl’ effect: the need to comply with multiple variants of rules of origin.

In these circumstances, any agreement that has the potential to multilateralise the existing PTAs in the region, to bring a semblance of order to the ‘noodle bowl’, must surely be welcomed. The Trans-Pacific Strategic Economic Partnership (P4), on which the TPP will build, is a rarity among Asian PTAs in that its membership has been expanded (to include Brunei); it explicitly allows for further expansion.

And, with some exceptions, it is a high quality agreement relative to most of those in Asia. But will the TPP really provide sufficient incentives to exporting interests to mobilize against domestic protectionist forces and pressure governments to deliver a high quality, multilateralised agreement?

One problem is that existing PTAs already link many of the TPP partners. Of the 28 potential dyads in the TPP, only eight are not covered by existing PTAs (Australia-Peru, Brunei-Peru, Brunei-US, Chile-Vietnam, New Zealand-Peru, New Zealand-US, Peru-Vietnam, and Vietnam-US). Many of these relationships involve negligible volumes of trade. The big prize in an expanded TPP would be preferential access to the US market for those countries that have not already signed a PTA with the United States.

It is not difficult to see why Wellington is an enthusiastic supporter – ‘Securing a free trade agreement negotiation with the United States has been a key New Zealand trade objective for more than a decade’. New Zealand’s efforts have been repeatedly rebuffed, in part for foreign policy reasons but also because of the composition of New Zealand exports to the US. Roughly one half consists of agricultural products, primarily beef, lamb, and dairy products—items that are particularly sensitive in the US market, as Australia found to its cost in the negotiations for its PTA with the US.

All the potential members of the TPP are relatively minor trading partners for the US. Combined they currently provide a market for only 5 per cent of total US exports. And, in the context of the pre-occupation of the US Congress with bilateral trade imbalances, it is notable that the only TPP partners with which the US currently runs trade deficits are the two countries that are most likely to benefit from improved access under the TPP to the US market—New Zealand and Vietnam. The potential gains for US exporters from trade agreements with Vietnam and New Zealand, which together account for less than one half of one percent of total US exports, appear slim, certainly insufficient to mobilize business to counter protectionist forces.

The risk is that, should the US decide to proceed with the TPP, it will again seek to carve out sensitive sectors. Another flawed agreement will result, but one that New Zealand and Vietnam will nonetheless be keen to sign on to, not least for political reasons.

President Obama, on his recent Asia trip, voiced support for the ratification of the trade agreement negotiated in 2007 with Korea, which, as America’s eighth largest market, consumes more than five times the volume of exports that the US sells to New Zealand and Vietnam combined. Nonetheless, he conspicuously avoided nominating a date for submitting the agreement to Congress. This clear signal of the difficult environment in which US trade policy is currently being crafted does not bode well for the TPP, however well-intentioned the USTR may be.

This post is part of a series of articles on the Trans-Pacific Partnership.