How a Trade Pact Between Europe and America Might Really Be Aimed at China

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I’ve mentioned before that TTIP—the trade pact between Europe and America that’s currently under negotiation—is likely to have a fairly modest impact on trade itself. That’s because trade between Europe and America is already pretty free. Rather, the most important effect of TTIP is likely to be in the areas of regulatory harmonization and the removal of various non-tariff barriers, including some contentious negotiations over IP law.

Dan Grant agrees, but suggests a way of looking at this that I haven’t seen elsewhere:

So if the TTIP isn’t especially controversial and its member states seem inclined to smooth off its rough edges, why is it significant?

China.

The TTIP isn’t just about lowering trade barriers between America and Europe; it’s also about setting rules. It will harmonize regulations for the entire trade area….America and Europe will set the rules for the global standard of free market enterprise.

….China’s trade record with other countries has been marred by claims of dumping, unsafe products, and consistent complaints over intellectual property rights violations, but the consequences to Beijing have been marginal. The creation of a massive trade bloc has the potential to change this dynamic. A robust TTIP advantages U.S. and EU companies, boosting their competitiveness and expanding their market share. Billions of dollars worth of Chinese products would be less competitive in the U.S. and EU markets. China could see its exports bottled up within its shores.

….Even though the Western press has largely overlooked this dimension of the TTIP, Beijing most assuredly has not. Intermittent claims of a potential trade cold war are bubbling up in Chinese media, and they’re likely to intensify as the TTIP negotiations advance….In light of such points, it’s important to note that the establishment of the TTIP should not be interpreted as an overtly aggressive move against China. Instead, it’s an opportunity for Beijing to formally make common cause with the developed economies of the world.

I don’t have the foreign affairs chops to really evaluate this, but it’s an interesting idea. Click the link to read Grant’s entire argument.

UPDATE: Evan Soltas has more on this subject here.

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You expect the big picture, and it's our job at Mother Jones to give it to you. And right now, so many of the troubles we face are the making not of a virus, but of the quest for profit, political or economic (and not just from the man in the White House who could have offered leadership and comfort but instead gave us bleach).

In "News Is Just Like Waste Management," we unpack what the coronavirus crisis has meant for journalism, including Mother Jones’, and how we can rise to the challenge. If you're able to, this is a critical moment to support our nonprofit journalism with a donation: We've scoured our budget and made the cuts we can without impairing our mission, and we hope to raise $400,000 from our community of online readers to help keep our big reporting projects going because this extraordinary pandemic-plus-election year is no time to pull back.

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