Abstract
The Trans-Pacific Partnership (TPP) is one of the proposed mega-free trade agreements. While several previous studies have measured the economic impact of the trade liberalization resulting from the TPP, the TPP may have not only a very large economic impact, but also a significant environmental impact, such as changes in greenhouse gas (GHG) emissions. The purpose of this paper is to contribute to the debate over TPP and GHG emissions by asking the following question: Will the TPP increase or decrease GHG emissions? We estimate the potential impact on GHG emissions changes caused by the TPP using the Global Trade Analysis Project (GTAP) model, and the GTAP CO2 and non-CO2 emissions databases. Our results suggest that the TPP is likely to increase the total amount of GHG emissions in the 12 TPP member countries, as well as global emissions. The main reason for increasing TPP member and global GHG emissions is non-CO2 emissions growth in Australia and the US.
Highlights
The Trans-Pacific Partnership (TPP) was signed by 12 countries (Japan, Malaysia, Singapore, Vietnam, Brunei, Australia, New Zealand, the United States (US), Canada, Mexico, Peru, and Chile) on February 2016
The purpose of this paper is to contribute to the debate over the TPP and greenhouse gas (GHG) emissions by asking the following question: Does the TPP increase or decrease GHG emissions? To address this research question, we estimate the potential impact on GHG emissions changes of the TPP using the Global Trade Analysis Project (GTAP) model [3], the GTAP CO2 emissions database [4], and the GTAP non-CO2 emissions database [5]
Tariff elimination and 50 percent reduction in NTBs on preferred partners and 25 percent NTB reduction on rest of world Tariff elimination and 25 percent reduction in NTBs, includes TPP plus an East Asian and an Asia-Pacific trade area (TPP includes South Korea) Tariff elimination and 20 percent reduction in NTBs, rice is excluded from tariff elimination, includes Regional Comprehensive Economic Partnership (RCEP), enlarged TPP, and TPP plus Free Trade Area of Asia–Pacific (FTAAP) scenario
Summary
The Trans-Pacific Partnership (TPP) was signed by 12 countries (Japan, Malaysia, Singapore, Vietnam, Brunei, Australia, New Zealand, the United States (US), Canada, Mexico, Peru, and Chile) on February 2016. The current TPP members account for approximately 40 percent of global GDP and one third of world trade [1]. Compared with the other Asia–Pacific mega-free trade agreements (FTAs) (Regional Comprehensive Economic Partnership (RCEP), Free Trade Area of Asia–Pacific (FTAAP), and Japan–China–Korea FTA (JCKFTA)), the TPP is characterized by not including the large Asian countries, China and India. The formation of a TPP would have both a very large economic impact and a significant environmental impact for the TPP members and the world. The environmental impact of a regional trade agreement is an empirical question [2]. To address this research question, we estimate the potential impact on GHG emissions changes of the TPP using the Global Trade Analysis Project (GTAP) model [3], the GTAP CO2 emissions database [4], and the GTAP non-CO2 emissions database [5]
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