The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) was recently ratified by Australia, Canada, Japan, Mexico, New Zealand, and Singapore. This multilateral trade agreement went into force for those countries on December 30, 2018. Vietnam also officially entered this agreement on January 14, 2019.
Additional signatories to CPTPP are Brunei, Chile, Malaysia, and Peru, but these countries have not yet ratified the agreement. When all 11 nations have joined, CPTPP will cover economies representing around 16 percent of global economic output and over 500 million people. “It will be interesting to see how our customers choose to use this new FTA for trade flows covered by existing bilateral or trilateral FTAs, such as NAFTA or the Mexico-Japan FTA.” says Dan Colosimo, project manager with MIC.
CPTPP includes reduced tariffs and lowered trade barriers for its member nations and is designed around higher standards for human rights, labor practices, and environmental standards. The United States was part of the original agreement, known then simply as the Trans-Pacific Partnership (TPP), as a countermeasure to China’s increasing influence in the region. However, in 2016 the U.S. officially withdrew from the TPP, effectively ending that version of the agreement. The remaining countries then revived the deal, removed some provisions, and established the current version of the agreement under the name CPTPP.
MIC has been following these developments and will offer a CPTPP trade agreement and trade content in its Origin Calculation System (OCS) software module.
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