TPP will be a mixed blessing for Australia

Comments on Shiro Armstrong "The race to a risky Trans-Pacific Partnership deal", 27/07/2015

Whether it is willingly or unwillingly on Australia's part, the Trans-Pacific Partnership (TPP) may prove to be a mixed blessing for Australia indeed, given that China is Australia's largest market and that Australia relies very heavily on Chinese economy to perform. China is excluded from the TPP and will suffer as a result of the trade diversion effects away from its exports. If China's exports is negatively affected by the TPP, then it in turn will have a negative effect on Australia.

But more seriously than that, the intention of the US and Japan to contain China's (and possibly India's too) rise economically as shown in their approach to the TPP memberships, there may be a long term and lasting damage to a number of bilateral relationships. In the future those countries which are deliberately excluded by the US and japan may take potentially remedy measures, whether it is retaliatory or purely a natural response.

The Chinese and Indians may not openly say anything but in their heart and minds it is crystal clear what the TPP is about and what it means for them. It may be forgiven sooner or later, but it will not be easily forgotten.

The damages have already been done and let's hope they would be contained without spiral out of control.