A trans-Pacific economy

AN EASY EXCHANGE: Vietnamese women load goods at a border trade area in Pingxiang, southwest China's Guangxi Zhuang Autonomous Region on February 5. China and the Association of Southeast Asian Nations formally launched their free trade area at the beginning of this year (ZHANG AILIN)

The reason many Asia-Pacific countries are taking a deep interest in the TPP is that current economic cooperation mechanisms in the region cannot meet their needs.

Given the stalemate of the Doha Round negotiations of the World Trade Organization, Asia-Pacific economies have forged a large number of regional trade agreements and bilateral free trade agreements. Their efforts, however, have only rendered regional economic relations even more complicated.

The United States is the biggest export market for most Asia-Pacific economies, as well as a major source of technology and investment for the region. Consequently, U.S. trade and fiscal deficits have transcended America's borders to become common concerns of the Asia-Pacific region. In this sense, the economy in this region has demonstrated a "trans-Pacific nature."

Rather, although East Asian countries have made rapid headway in economic integration in recent years, an East Asian economic cooperation process excluding the United States is wishful thinking at best.

From the U.S. perspective, APEC serves as the premium mechanism for regional cooperation. Despite its sluggish progress, Washington still expects APEC to play a leading role in promoting regional trade and investment liberalization.

During the 2010 and 2011 APEC forums to be held in Japan and the United States respectively, the two allies are expected to make concerted efforts to boost APEC's competence in this regard. If their efforts turn out to be futile, however, the United States might well abandon APEC and turn to the TPP instead.

As an open economy that relies on foreign markets and resources, China also needs to consider taking Asia-Pacific partnership as a major channel for its regional economic cooperation.

Today, there is a heightened economic interdependence across the Pacific Ocean, as evidenced, most notably, by the "structural dependence" between China and the United States. China's development and the development of the Asia-Pacific region at large are impossible without the collaboration of the United States. The United States' role in regional trade, economic restructuring as well as money and financial markets is also undeniable.

At the same time, it should also be noted that Asian economic cooperation mechanisms face bottlenecks because of economic, political and strategic differences among member countries. Mechanisms such as cooperation between China, Japan and South Korea and "ASEAN plus three" (a cooperative initiative between the Association of Southeast Asian Nations and China, Japan and South Korea), for instance, have yet to make substantive breakthroughs.