TPP and the ensuing trade war

President Barack Obama won the battle when the majority-Republican Senate had passed a bill giving the president fast-track authority and providing aid to workers who might lose their jobs because of TPP. It means that Congress has approved the project of Trans-Pacific Partnership (TPP) agreement which has become President Obama's signature project in the second term of his presidency. The approval of the house would enable the President to secure the 'historic' trade deal.
Having faced with the difficulty to pass the bill, President Obama  undertook trips to different parts of America to explain what TPP stands for and explained that there was no reason for concern that American jobs would be offshored.
The trade agreement has been floated by President Obama to rein in China's rising economic clout in Asia and Europe. Undoubtedly, China has turned out to be a major economic power in Asia whose gross domestic product reached $3583.38 billion with its economy growing at a rate of 7.7 per cent every year. On the other hand, economic growth rate of the US is currently at 2.2 per cent.  
President Obama's Asia pivot has no match with Chinese advancement in Asia while the US is heavily indebted to China, Japan and South Korea. China has invested in India, Pakistan, Bangladesh and Sri Lanka. In April this year Chinese President Xi Jinping cemented the long-standing friendship between China and Pakistan by offering a $46 billion infrastructure investment which is more than all assistance received from the US -- Pakistan's largest donor since 2002. Similarly, China is investing $ 20 billion in next 5 years in India. This commitment was made by the Chinese President during his visit to India in September 2014. As of now, China has invested in Bangladesh around $6.29 billion, according to China global investment tracker created by the American Enterprise Institute and Heritage foundation. During the visit to Bangladesh by Chinese Special Envoy Chai Xi, Bangladesh Prime Minister sought more Chinese investment to Bangladesh and proposed to allocate economic and industrial zone for Chinese investment in Bangladesh. Sri Lankan President Maithripala Sirisena, who replaced reportedly Pro-China President Rajapaksa, visited China in May this year immediately after taking over, understandably to remove any misunderstanding arising out of the suspension of work on a $ 1.4 billion port city development project by China.
China has been making rapid progress in economic fields which is expected to surpass the United States this year as forecasted by the International Monetary Fund. China's economy will grow to $ 10 trillion this year. Yet its share of voting in IMF is only 3.72 per cent whereas the US holds a share of 17.4 per cent. This is another area of discontent for China. In fact, US is indebted to China, Japan and Brazil, another rising economic power house in Latin America. As of May, 2013, US national debt is estimated at over $16 trillion. China holds $ 1315.9 billion in treasury bonds, while Japan $1111.0 billion. Brazil holds $255.3 billion of US treasury bonds. Therefore, economy of the United States is not so strong as it is generally taken for granted. China has expanded its trade relations from South Korea to Australia which could gradually erode influence of the United States. Moreover, China has floated a regional infrastructure investment bank with  20 other countries. This has the support of the BRICS countries that include Brazil, Russia, India, China and South Africa. This infrastructure bank with its headquarters in Shanghai is believed to considerably curtail the role of  the World Bank and IMF over time.  
China has succeeded in signing free trade agreement with South Korea, a strong ally of the United States. China plans to open stock market to foreign investors by linking exchanges in Hong Kong and Shanghai. According to Washington Times, "China has launched  a series of trade and finance initiatives in pursuit of a bigger role in US dominated economic and security organisations to reflect Beijing's' status as the  world's second biggest  economy".
President Obama's signature project of Trans-Pacific Partnership deal involves eleven other nations of the Asia-Pacific rim. It is understood  that the TPP is built on the original P4 agreement among Brunei, Chile, Singapore and New Zealand which came into effect in 2006 while in November 2011 leaders of Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, US and Vietnam agreed for establishing  comprehensive regional trade agreement for reducing tariffs and addressing emerging trade issues.
There is no doubt that TPP will become an important economic strategy for the United States since the Asia-Pacific Rim has become the fastest growing region in the present day world and a key player of global economic growth. Asia-Pacific Rim accounts for 60 per cent of global GDP (gross domestic product), apart from 50 per cent of international trade. It would be interesting to note the progress of the TPP in the context of China's ever growing influence in the Asian region.

The writer is a retired diplomat from Bangladesh.
amjad.21@gmail.com