The TPP has marked a change from the traditional negotiation mode of mutually exchanging market access, attempting to set new rules for regional economic integration—a feature that regional economies recognize for its potential long-term significance. However, most Asia-Pacific economies are unwilling to put all their eggs into one basket. On the one hand, they welcome TPP negotiations; and on the other hand, they also actively participate in bilateral trade negotiations and multilateral talks within frameworks such as the Association of Southeast Asian Nations (ASEAN), the East Asia Summit, ASEAN+1 and ASEAN+3. These negotiations vary in terms of their respective standards and scope, representing a diverse array of free trade experiments in the region.

Regional solutions

In 2006, Japan proposed the Comprehensive Economic Partnership in East Asia on the basis of East Asian cooperation, attempting to compete with China's proposal of an East Asia Free Trade Area on the basis of the ASEAN+3 group (ASEAN plus China, Japan and South Korea). Both initiatives are aimed at establishing an East Asian community. When TPP negotiations gained momentum, some East Asian economies including Japan, Singapore, Malaysia, Viet Nam and the Philippines joined the talks; but in the meantime, to maintain its lead role in East Asian cooperation, ASEAN as a whole began to promote negotiations for the Regional Comprehensive Economic Partnership (RCEP).

With the ASEAN Free Trade Area (FTA) at the core, the RCEP is a proposed free trade agreement between the 10 ASEAN members and six economies with which ASEAN has existing FTAs including China, Japan, South Korea, India, Australia, and New Zealand. The RCEP will feature broader and deeper engagement with significant improvements of the existing five ASEAN+1 FTAs, while recognizing the individual and diverse conditions of participating economies. It aims to create a high-quality, modern FTA that will add new elements including trade in services, intellectual property protection and competition policies on the basis of existing FTAs. While member economies hold talks on the RCEP, bilateral free trade negotiations are underway between ASEAN and its partners, as well as talks on a China-South Korea free trade agreement and a China-Japan-South Korea FTA.

Although TPP and RCEP members mostly overlap one another, the United States and China—the world's two largest economies—have only participated in one of the two platforms respectively. Therefore, the two platforms will unavoidably compete for the dominance in regional trade liberalization efforts. While the threshold of the RCEP is relatively low and market openness among member states is high, some regional economies such as Japan, Viet Nam and the Philippines might focus more on TPP negotiations owing to their own strategic considerations as well as current strained relations with China, which have somewhat weakened their resolve to promote the RCEP process.

The Asia-Pacific region has been dubbed the world's "Rim of Hope." The focus of global economic development and strategic security are shifting rapidly to the east. However, due to differences in culture, social systems and economic development levels within the region, both the TPP and RCEP face difficulties in coordinating various interests. Perhaps neither the TPP nor the RCEP can become the sole dominant platform for Asia-Pacific regional trade liberalization, but there is possibility for the two to integrate with each other. China hopes the RCEP agreement could be reached by the end of 2015, but also stressed that it is open to the TPP and believes that the two are not mutually exclusive but could rather stimulate each other. In addition, the Obama administration also publicly expressed that China is welcome to join the TPP.

The upcoming 2014 APEC leaders' meeting in Beijing could play an active role in promoting the integration of the TPP and RCEP by promoting the Free Trade Agreement of the Asia-Pacific (FTAAP). As the most important regional cooperation organization, APEC first proposed the FTAAP as early as in 2004. In 2006, APEC leaders' Hanoi Declaration made the FTAAP a long-term vision for study. China has chosen "Jointly Build a Future-Oriented Asia-Pacific Partnership" as the theme of this year's APEC leaders' meeting. It is hoped that the meeting could officially launch a feasibility study of the FTAAP, by which it can create substantial progress in regional economic integration, taking a key step toward building a trans-Pacific cooperation framework that benefits all.

Perhaps in the future, when people review the process of trade and investment liberalization in the Asia-Pacific, they will see that the TPP and RCEP were the two wheels of the FTAAP that APEC drove in the late autumn of 2014 in Beijing.

Most participants of the TPP and RCEP would prefer to see one negotiation process that promotes others rather than an intertwined mass of preferential trading arrangements and rules of origin that create a confounding web of interests. Above all, they know clearly that any discriminatory and exclusive multilateral institutional arrangement would critically damage the economy and strategic security of the Asia-Pacific region. They do not want the choosing of sides to encourage the trend of intra-regional competition. Ultimately, the future of regional trade and investment liberalization as well as regional security depends largely on the mutual cooperation and coordination between the world's two largest economic powerhouses.

The author is an op-ed contributor to Beijing Review

Email us at: yanwei@bjreview.com