TCCP | Trilateral Comprehensive Cooperative Partnership

In a breakthrough meeting, the three country leaders from China, Japan, and South Korea have agreed to begin negotiations toward a free trade accord which would operate between what are three of Asia’s largest economies.

The three leaders who have initiated the accord are South Korea’s President Lee Myung Bak, Japanese Prime Minister Yoshihiko Noda, and Chinese premier Wen Jiabao. These leaders met in Beijing on 12th May 2012, and through their respective trade ministers, they have now agreed to sign a trade accord – a TCCP. Despite their having been discussions around this in the past, this is being perceived as the first legal document around this trilateral cooperation covering economics.

This China South Korea Japan Free Trade Zone Agreement is basically legal documentation geared towards protecting investments between the three countries. The agreement comprises of 27 articles with an additional protocol that covers what are the important aspects of international investments ranging from the definition of investment, scope, taxation, general exceptions, and dispute settlement.

The proposed free trade pact is expected to foster economic vitality within the region, and it is also going to propel economic integration in East Asia. Such a free trade economic agreement is being anticipated to provide a market that comprises of more than 1.5 billion people and given the direction of World trade at present this TCCP seems set to become the leading free trade zone globally when it is finally set in place.

This particular trilateral agreement is expected to expand both trilateral and bilateral trade opportunities and it is also going to provide comprehensive and institutional framework where wide range of trilateral cooperation’s would naturally emerge. This particular China South Korea Japan Free Trade Agreement is expected to act as a cushion during situations such as global financial crisis and Europe debt issues, because these three countries are reliant on export markets in driving their economic growth. .

Such cooperation is much conducive towards the development of each country on its own, and it is also likely to boost the East Asian integration process while propelling world’s economic growth. In addition to economic integration, such a trilateral agreement will also boost technology advancement and industrial cooperation.

North East Asia is also the most vibrant region across the globe, and this clearly depicts the kind of potential when the three countries cooperate economically. Also when the three countries combine, South Korea, Japan, and China this trading block is going to form the world’s largest economy much robust than the European Union in terms of purchasing power parity. For instance, trade between the three countries (China, Japan, and South Korea) has already peaked to $690Bn in 2011 up form just $130bn in 1999.

According to a feasibility study released by the three countries that are championing the trade pact, it is in record that South Korea, Japan, and China accounted for approximately 19.6 of the worlds GDP and an average of 18.5% of world’s exports in 2010. Such an economic treaty has the potential to lift the GDP of each of these three countries South Korea, Japan, and China by 3.1%, 0.5%, and 2.9% respectively.

Apart from the economic benefits, the three leaders from China, Japan, and South Korea have also vowed to work together so that they can ease regional disputes and tensions aimed specifically at the Korean Peninsula. This is so because North Korea has been heavily investing in weapons with a series of nuclear tests at the expense of economic prosperity.