Article content continued
The TPP is seen as a more sophisticated document because it makes a greater effort to cover aspects of the digital economy, but that might not be enough to offset the allure of an Asian trading zone that features China, Japan and South Korea, rather than only Japan, which is the economic magnet of the TPP.
“China will have a dominant role in RCEP,” said Herman. “The global economy is shifting to that part of the world.”
That’s another complicating factor for Canada. The political class can’t decide how it wants to deal with China, which is on its way to becoming the world’s largest economy. Certainly, there is little room for positive diplomatic engagement while Michael Kovrig and Michael Spavor remain under arbitrary detention by Chinese authorities. It also has become impossible for democratic countries such as Canada to ignore the Chinese government’s imprisonment of millions of Uighurs in the northwestern region of Xinjiang.
Canada isn’t the only smaller Western trading partner that China has sought to punish. Australia also is getting a rough ride lately. But Australia, along with New Zealand, is a member of RCEP. So, while politicians and diplomats fight at the highest levels, antipodean companies still might be able to exploit the Chinese market under the cover of their governments’ new trade agreement. That will give them an advantage in the region over Canadian and American rivals.
We are going to have to learn how to take a beating (from China) in some areas and how to make money in others
Carlo Dade
“Our allies have figured out how to engage China,” said Carlo Dade, director of the Trade and Investment Centre at the Canada West Foundation, a Calgary-based think-tank. “Australia and New Zealand now have another way into China,” he added. “We are going to have to learn how to take a beating (from China) in some areas and how to make money in others.”
