Monday, 5 October 2015

The TPP - How China will respond

Today we have seen the signing of the Trans Pacific Partnership (TPP). The TPP is one of the largest trade deals ever completed in the world and we still have no idea what we have signed up for. However, the actual deal on individuals is irrelevant. The TPP was not done for the best interest of the Australian, American or Japanese people, it was done to stop China from becoming the dominate force in the world. It is the another salvo in their trade war with China and they will not respond well.


The TPP is an agreement between 12 countries on the Pacific Rim including America, Japan, Australia, Chile, New Zealand, Canada and Singapore, just to name a few. The deal, which had been kept secret from general population and even most government official creates an exclusive trading block and deliberately keeps China out. The TPP is to try and give the signatory countries the ability to overcome China’s cheap labour and products.


The issue now is not what the TPP does for us, but how China will respond. Over the last few years a lot has been going with China and it has been causing concern around the world.


First we have the disputed waters of the South China Sea and the Spratly Islands. While China lays claim to this area, so do a lot of other countries including the Philippines and Vietnam. This has caused tension in the area, especially since China began land reclamation of the area and started building islands. To top it off they are also putting military equipment on those islands.


Then there is the internal struggle. Earlies this year the Chinese government removed over 200 top military personnel from their army. There was a mass bribery scandal going on, with the top general taking bribes to move people up the ranks. It had all the hallmarks of a military coup. The President, Xi Jinping, is not in a very stable position at the moment. If he needs to stabilize his position and deflect any attention of a coup, he will go to war with another country.


And to top it all off with have China’s, and the world's, economy in a mess. Their rapid expansion over the last 20 years has had a cost and they are being asked to pay for it now. China’s markets crashed in late August and they are still having trouble coming back, even after the Chinese government tried another simulation package.


In order for China to get out of the financial mess they are in, they will need to trade, that is, sell more goods to the rest of the world. However, the TPP had been brought into place now to stop that. The TPP has been negotiated for years, however, if the signatory countries can get it into place now while China is low, they will strike a savage trade blow.


Of course none of this will be discussed by the politicians that signed the TPP. They will only talk about the benefits it has for our our economies. They will ignore any talk of China, or say that it has nothing to do with them.


What these politicians are unaware of is, China will come out swinging. When you kick someone when they are down, they will come back at you. Sure it may not be straight away, but they will come back. And China will come back hard.


I have said it before, we are already in World War 3. Iraq, Afghanistan, and the Ukraine are the physical sides we can see at the moment. Behind the scenes we have currency and trade wars raging. There are also covert operation being conducted on the internet to penetrate other counties defences.


While WW3 is contained at the moment to these areas, the TPP will push it into a bigger arena. Of course, the TPP will not be given the blame, and China will have to take full responsibility for “starting” WW3. However, we now know the truth.


When I write a blog post I normally like to be able to tell people what they can do to fix the problem I have been writing about. Unfortunately today I have no solution. This is now a matter of wait and see.


If there is one thing I can suggest, keep learning. Stay up to date with what is going on and be ready to change your plans and goals when needed. The TPP will have other affects on your life, so you will need to know more about it anyway.


For more information follow the link at the bottom of the page.

Terry Shadwell
Your Life Your Way

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http://www.smh.com.au/business/the-economy/tpp-deal-pacific-countries-agree-to-historic-trade-pact-20151005-gk1vq2.html

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