Why in news?
Asia-Pacific countries, including Japan, Australia and Canada, signed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) in Chile.
FACTS FOR PRELIMS
About the agreement
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is a free trade agreement involving 11 countries in the Pacific region, including New Zealand, Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, Peru, Singapore, and Viet Nam.
Its main purpose is to slash trade tariffs between member countries , But it also seeks to reduce so-called non-tariff measures, which create obstacles to trade through regulations.
There are also commitments to enforce minimum labour and environmental standards.
It also includes a controversial Investor-State Dispute Settlement mechanism, which allows companies to sue governments when they believe a change in law has affected their profits.
The CPTPP incorporates most of the provisions of the Trans-Pacific Partnership (TPP) agreement.
The TPP was originally concluded in 2015, by 12 countries (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam) and was signed in 2016, by all 12 parties.
In 2017 the United States notified TPP signatories of its intention to not ratify the TPP, effectively withdrawing from the TPP. Without the United States, the TPP agreement cannot enter into force as it requires ratification by at least six states that together have a GDP of more than 85% of the GDP of all signatories.