Competitive Mega-regional Trade Agreements: Regional Comprehensive Economic Partnership (RCEP) vs. Trans-Pacific Partnership (TPP)

The Trans-Pacific Partnership (TPP) and the Regional Comprehensive Economic Partnership (RCEP) are both mega-regional trade initiatives in the Asia-Pacific that began in the late 2000s. Both are currently still under negotiation, and once concluded, will potentially shape the future of economic integration in the region. This paper seeks to explain why two overlapping yet diverging mega-regional trade deals emerged in the same region at around the same time. The paper posits that there is a direct relationship between the development of the TPP and that of the RCEP. Hence, it seeks to find a theory that best explains the interactive progress of the two “tracks”. By tracing the historical evolution of both agreements, comparing their key features, and studying the motivations and actions of the main players participating in either or both agreements, the author finds that firstly, there is indeed a competitive and mutually stimulating relationship between the TPP and the RCEP. Secondly, the theory that best explains the dynamics between the two proposals is “competitive regionalism”. This recently developed theory not only integrates realist and liberal arguments, but also takes into consideration domestic interests in influencing the mega-regional trade negotiations. Hence, it best accounts for the authors’ observations on the sequencing and patterns of the emerging regional trade arrangements, as well as the motivations and actions of participating states. This paper contributes to the analytical and theoretical literature on economic regionalism in general, and offers insights on the current state of Asia-Pacific economic integration.