Introduction

The ASEAN–Australia–New Zealand FTA (AANZFTA) combines two different pre-existing country groupings of long-standing. The first of these is ASEAN, the Association of Southeast Asian Nations, which was founded in 1967 by Indonesia, Malaysia, the Philippines, Singapore and Thailand. This grouping has expanded over the years, with Brunei Darussalam joining in 1984, followed by Vietnam in 1995, Laos and Myanmar in 1997, and Cambodia in 1999. While ASEAN has existed for nearly 50 years, for most of that period it has served as an alliance based on economic and political cooperation rather than as a free trade agreement. However, the original members of ASEAN launched a free trade initiative, the ASEAN Free Trade Area (AFTA), in 1992. In 2003, after the expansion of ASEAN to its current membership, ASEAN announced plans to create an ASEAN Community comprising three pillars, one of which would be a free trade agreement to be called the ASEAN Economic Community. In 2007, this intention was memorialized in writing with a timetable to form the Community by 2015.

The other pre-existing alliance was that between Australia and New Zealand, which have a long history of formal trade agreements. In 1965, close in time to the creation of ASEAN, these Oceania neighbours formed a free trade agreement known as the New Zealand–Australia Free Trade Agreement. This FTA was eclipsed in 1983 by the highly ambitious Australia–New Zealand Closer Economic Relations Trade Agreement (ANZCERTA), most commonly referred to as Closer Economic Relations (CER).

Given the linkages already in place between the ASEAN countries on the one hand, and Australia and New Zealand on the other, the primary trade gains to be had pursuant to AANZFTA lie in new linkages between Australia and New Zealand and specific ASEAN members. Indeed, pursuant to an exchange of letters bearing treaty status, Australia and New Zealand have agreed that AANZFTA obligations only apply between them to a limited extent, including the tariff and Rules of Origin (ROO) commitments and the General Exceptions chapter.

Following several years of negotiations, these two groupings formed the ASEAN–Australia–New Zealand Free Trade Agreement (AANZFTA), which came into force on 1 January 2010 for most of its participants. AANZFTA has been in effect for all participants since January 2012.

This chapter examines the prospects for the Trans-Pacific Partnership (TPP) to expand into a Free Trade Area of the Asia-Pacific (FTAAP). It does so by comparing the TPP to other potential models for Asian economic integration, and by identifying what factors might enhance or diminish the possibility of the TPP serving as the FTAAP model.

First, the chapter briefly traces the history of the TPP and its linkage to a potential FTAAP. Second, it examines other potential models for regional economic integration and discusses the pros and cons of each option for the major economies in the region. Third, it discusses reasons why the TPP might or might not be the preferred model, identifying important factors playing into this calculus.

The origins of the TPP-FTAAP linkage

The concept of an FTAAP has been bandied about for the past several years. C. Fred Bergsten has been a particularly strong advocate of this idea, espousing the pursuit of the Bogor goals of free trade and investment regimes throughout the Asia-Pacific Economic Cooperation (APEC). APEC initiated a study of the FTAAP concept in 2006, and in 2009 pledged to explore pathways to create an FTAAP. Bergsten’s early writings 3 on the subject assumed the only way an FTAAP could be accomplished would be to take the existing regional FTAs and agreements and combine them into an FTAAP. More recently, however, Bergsten has seized upon the TPP as the basis for an ultimate FTAAP.

INTRODUCTION

The World Trade Organization (WTO) has been, and continues to be, shaped in its agreements and institutional foci in significant part by political pressures emanating from its members, particularly those able to wield the most influence. Rather than being an institution with the singular focus of achieving free trade among all members, the WTO comprises a complex set of agreements, many of which represent a politically driven compromise among members as to how to manage trade rather than to liberalize it. Although the state of WTO liberalization reflects positions agreed to in part as a result of political realities, the reach of politics is more significant in the context of bilateral trade negotiations. Indeed, what members cannot accomplish through the WTO they may try to achieve through free trade agreements (FTAs), particularly with politically or economically weaker trade partners. In the case of the United States, FTAs have been used as an opportunity to impose provisions favored by domestic constituents – such as strengthened intellectual property provisions and labor and environment clauses – that it has not been able to get WTO members to agree to collectively in the multilateral forum. A similar phenomenon has occurred with respect to the European Union (EU) and its FTA partners. For countries with less bargaining power, the WTO's multilateral setting provides some buffer from power politics in the form of the consensus decision-making practice and the disproportionate number of developing and least-developed countries.

Introduction

Indigenous communities have used native plants as foods and for medicinal purposes for thousands of years. Some of these indigenous products have proven sufficiently popular that individuals outside the indigenous community have sought to consume, purchase and market them. In certain instances, new products have been derived from the indigenous plant and sold outside the indigenous community. In other cases, the indigenous product has been exported in its original form, but utilized in non-traditional ways in the export market. In recent years, various WTO Members have imposed bans and other restrictions on the importation of certain indigenous products on the basis of health and safety concerns. These restrictions tend to be blanket bans on the products as a whole, thus curtailing both the ability to consume indigenous products according to their traditional uses, as well as the adapted versions of such products.

This chapter uses the example of the recent bans on kava from Pacific Island countries as context to argue that the safety of indigenous products with long histories of traditional use should be evaluated on their own merits. They should not be deemed the equivalent of new products with new uses that have been adapted from the indigenous plant, nor should their safety be assessed in combination with such new products. Bans on indigenous products may well be overbroad if they do not differentiate between traditional (quite possibly safe) uses and new (perhaps not-so-safe) uses.

The multiplicity of commitments resulting from the World Trade Organization (WTO), free trade agreements (FTAs), bilateral investment treaties and other agreements has increasingly complicated the nature of national obligations. The World Bank and IMF further impinge on national autonomy by imposing a variety of conditions on loans and other forms of funding. All of these treaty obligations impact on governments' ability to exercise complete autonomy in the establishing and administering of national policy objectives. In particular, the rules and decisions arising from these international agreements and financial institutions result in limitations on countries' ability to make a wide range of regulatory decisions, including those relating to health, environment, immigration and other issues of national importance. Until relatively recently, these types of regulatory matters were regarded as policies almost exclusively to be determined by sovereign nations. At the same time that international agreements pose constraints on national regulatory autonomy, there remains considerable national autonomy in relation to how to comply with the variety of obligations the agreements impose. This tension between international cooperation and autonomy to act in the national interest is the core theme running through this collection.

The complex interplay between international economic law and national autonomy presents such a variety of interesting legal issues that we decided to make this the theme of the inaugural conference of the New Zealand Centre of International Economic Law (NZCIEL).