The Obama Administration is wisely moving forward with a landmark trade agreement called the Trans-Pacific Partnership (TPP). Ideally, it will increase regional economic integration between the U.S. and eight other Asia-Pacific nations. But in a new report, Gold-Standard or WTO-Lite? Shaping the Trans-Pacific Partnership, ITIF questions whether the TPP will truly raise the bar for fair, market-based trade or allow the continuation of rampant mercantilist practices such as intellectual property theft, non-tariff barriers, discriminatory government procurement practices and other practices that have hurt U.S. economic growth and invited skepticism of global trade.

1. May 25, 2011
Crafting the Trans-Pacific
Partnership as a True Model
21st Century Trade Agreement
Robert D. Atkinson
President
Information Technology and Innovation
Foundation

2. Innovation Mercantilism is Widespread
1. The global economic system has become increasingly distorted, as an
increasing number of nations have embraced innovation mercantilism.
2. Innovation mercantilism is designed to promote trade surpluses
through a variety of negative-sum activities:
 Pricing under cost (dumping, subsidies, currency manipulation);
 Limiting imports (closed markets, forced offsets/tech transfer, standards
manipulation, IP theft, indigenous innovation policies).
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3. The U.S. Has 3 Possible Responses
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4. 1) Do Nothing:
After All Mercantilists
Only Hurt
Themselves
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5. 2) Don’t Fight; Switch
Match Their
Mercantilism
With Our
Own
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6. 3) Don’t Switch; Fight!:
Systemically
Challenge
Mercantilists and
Mercantilist Practices,
While Crafting
Stronger Alliances
with Free Traders.
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7. The WTO Process Has Proved Limited as a Vehicle to Fight Mercantilism
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8. The TPP Provides a New Opportunity to Constrain Mercantilism
The TPP is A free trade agreement the Obama Administration
is negotiating entrance into to increase regional economic
integration across nine Asia-Pacific nations:
 Australia
 Brunei Darussalam,
 Chile,
 Malaysia,
 New Zealand
 Peru,
 Singapore,
 Vietnam
 U.S.
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9. The TPP Provides a New Opportunity to Constrain Mercantilism
But only if the
United States
insists on a “Gold
Standard” TPP
Framework.
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10. What a “Gold-standard TPP” Needs to Achieve
 TPP Partners Must Better Protect IP Rights
 TPP Members Must Commit to Open and Non-
Discriminatory Government Procurement
 Non-preferential Treatment of State-owned Enterprises
 Services Trade Liberalization
 Market Access
 Eliminating Non-tariff Barriers
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11. No Need for a Quick Win
 Success is NOT signing new trade agreements.
 Success IS signing agreements that moves the
global trading system decisively away from
mercantilism, while building a growing
“coalition of the ‘market-based’.”
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12. No Need for a Quick Win
 If the TPP is anything
less than a gold standard
agreement, the U.S.
should decline to join.
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13. Thank You
Robert Atkinson
ratkinson@itif.org
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