The trade ministers of the 12 signatory countries signed the Trans-Pacific Partnership agreement this morning in Auckland, New Zealand.
Tariffs on a wide range of products will be slashed or eliminated. Vietnam and Malaysia are said to be two countries that would benefit the most from the TPP. The Peterson Institute for International Economics predicted that Vietnam's textile and leather shoes export would grow and the export quota would increase by 31.7 percent. It will also boost foreign investment in Vietnam.
Minister of Industry and Trade Vu Huy Hoang said, "Joining the TPP is a milestone for Vietnam's global integration process. We have made huge steps in the integration since joining ASEAN in 1995. TPP will provide big opportunities for our economy."
New Zealand Prime Minister John Key said the TPP represented the confidence and optimism for future prosperity.
When being asked about the possibility of China joining TPP, US Trade Representative Michael Froman said TPP was not aimed against China and it was necessary to have a constructive economic relationship with China.
The TPP has been under negotiation since March 2010 and involves the US, Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile and Peru, which accounts for 40 percent of the global economy. It is also the biggest trade deal to date.
Experts said TPP is part of the US's pivot to Asia and an attempt to counter China's growing presence worldwide.
The TPP may continue to face opposition as now each country has two years to ratify or reject the deal. If the countries can't get the deal approved within two years, the TPP could still take effect if approved by six member countries representing at least 85 percent of the group's GDP.
In reality, the US accounts for 62 percent while Japan follows with 17 percent so it means the deal would only collapse if the US or Japan fail to give domestic approval.