Pacific Rim trade pact signed

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Representatives of members of Trans-Pacific Partnership (TPP) trade deal wave as they pose for an official picture after the signing agreement ceremony in Santiago, Chile March 8, 2018.

The CPTPP will enter into force when it has been ratified by at least six of its 11 countries, a process that could take up to a year and involves amending their respective laws.

This week, other parties to TPP created a new pact on the same principles, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

However, the USA abruptly abandoned the trade deal when President Trump made a decision to withdraw from it just three days after he was inaugurated as president. The CPTPP is a slimmed-down version of the original deal.

Colombia and Thailand are among countries that are interested in participating in the framework, while the 11 states are closely gauging Trump's position after he suggested a possible return to the pact in Davos, Switzerland, in January, if the United States could strike a "substantially better deal".

Chilean President Bachelet emphasised that CPTPP members would still welcome the United States if it wished join the pact again, but Washington would have to accept the terms of the revised agreement.

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China's defence spending as a share of GDP and the budget also remains lower than that of other major nations, he said. That is a far more optimistic spin on China's aggressive policies than most of its neighbors would offer.

"Little by little, his advisors have managed to make Trump realize the role that the United States plays in Asia Pacific and the role played by the TPP in that region, not only in economic and trade terms, but in geopolitical terms", said Bartesaghi.

The agreement, formerly known as the TPPA when the United States was part of negotiations, brings together 11 countries whose combined economies total 13.5 per cent of the world's GDP.

In relation to CPTPP members - Japan, Brunei, Chile, Malaysia, New Zealand, Singapore and Vietnam - existing bilateral and / or regional agreements have, or are already delivering, market access improvements, Mr Finucan said.

The original TPP was conceived by the a counterweight to China's growing economic influence through a robust trading bloc that excluded the Asian giant. Around 20 provisions have also been suspended if Washington stays out of the pact, 11 of which are related to intellectual property.

The revised agreement eliminates some requirements of the original TPP demanded by USA negotiators, including rules to ramp up intellectual property protection of pharmaceuticals. The agreement will eliminate more than 98 percent of tariffs in the free trade area.

Richard Haass, president of the Council on Foreign Relations, tweeted that it is a "truly a sad and bad day for the United States, as TPP comes into force without us while U.S. deciding on which countries to apply unwarranted and ill-advised tariffs".