China & World Economy / 18–36, Vol. 28, No. 2, 2020

Should China Join the New Trans-Pacific Partnership?

Peter A. Petri, Michael G. Plummer

Abstract

After President Donald Trump’s ill-advised pullout from the Trans-Pacific Partnership (TPP) and despite the absence of the US, the remaining 11 Asian and Pacific countries agreed on a deal, renamed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). The accord took effect on 30 December 2018 and provides rigorous, up-to-date rules for Asia−Pacific trade, but excludes the region’s two biggest economies: the US and China. In this paper, we calculate that Chinese membership in the CPTPP would yield large economic and political benefits to China and other members. The CPTPP, in its current form, would generate global income gains estimated at US$147bn annually. If China were to join, these gains would quadruple to US$632bn, or a quarter more than in the original TPP with the US. But to join the CPTPP, China would have to undertake unprecedented reforms and manage complex political challenges.