China is keen to join TPP but for that the country will need nod from the US and also have to negotiate separately with each of the 12 countries that are part of TPP, to obtain membership. The countries will have the right to set conditions for China and China will have to pay to join the TPP. But it is still unclear what price China will have to pay.

The TPP agreement is expected to control 40 per cent of the world’s trade and will directly confront China. It is obvious that the TPP upholds the 12 countries’ interests and protects them from being blocked by China. Vietnamese textile and garment enterprises have been using Chinese materials to make finished products. However, when Vietnam joins the TPP, it would rather buy input materials from TPP member countries to be able to enjoy TPP’s preferential tariffs. If so, China will lose an important customer.

On the other hand China has been preparing well for this. It has relocated factories to Vietnam to make Vietnam-sourced products which can enjoy preferential tariffs. Besides the TPP, the US has announced the launch of talks on the Transatlantic Trade and Investment Partnership with the 28-nation European Union, with the first round of negotiations due early July.