Reshaping the Global Trade Order: EU and CPTPP Take the Lead

On November 20, 2025, an important summit for German foreign trade will take place in Melbourne, Australia. For the first time, the European Union and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will discuss coordinating trade policies. Together, the EU and the twelve CPTPP countries – Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United Kingdom, and Vietnam – account for more than 30 percent of global trade, twice as much as the United States.

German industry is counting on the EU and CPTPP to form a "coalition of the willing" to preserve and further develop the rules-based global trading system and maintain open markets. After all, in Germany, one in four jobs depends on exports, and in manufacturing, it’s one in two.

U.S. Trade Policy Puts Global Trade Order Under Pressure

The United States’ new high-tariff policy and various "U.S. trade deals", which are incompatible with the rules of the World Trade Organization (WTO), mark a turning point in the global trade system. For internationally oriented German businesses, this is a dangerous development: the new trade policy reality is characterized by uncertainty, protectionism, and 'might makes right'. Many German companies rely on open markets, fair and transparent rules, and their enforcement. Therefore, it remains crucial for the majority of German industry that the EU avoids agreements with its trading partners that violate WTO rules and thus accelerate the erosion of the multilateral trading system. In its bilateral negotiations, the EU should promote commitments to constructive cooperation within the WTO. As a rules-based community of states, the EU must defend the rule of law, which also underpins the European Single Market.

Coalition for Free Trade

To prevent unchecked protectionism from spreading, the rules-based trading system must be preserved. The remaining 165 WTO members account for 85 percent of global trade. What is needed now is a coalition for free trade. The EU should lead such a coalition together with the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) – without undermining the WTO. A "standstill agreement", in which the EU and CPTPP commit to continue applying WTO rules and principles such as most-favored-nation treatment and refrain from imposing non-compliant tariffs, would restore urgently needed planning certainty for businesses. Equally essential would be an agreement to renounce export restrictions and economic coercive measures. In addition, government transparency and notification obligations regarding export controls should be strengthened – for example, through a code of conduct. The EU-CPTPP coalition should serve as an open forum for other like-minded countries that seek to jointly strengthen rules-based trade.

Strengthening EU-Asia Relations

In addition, the EU should work closely with CPTPP to jointly set future standards in the digital sector and better align their industrial policies. Through bilateral digital agreements, the EU has already laid important groundwork with individual countries.

However, the EU should not join CPTPP – doing so would make it a "rule taker", requiring it to adopt regulatory approaches in areas such as digital policy that were originally negotiated by the United States within the Trans-Pacific Partnership. The EU should maintain its ambition to be a "rule maker," given its economic strength. Through bilateral agreements, the EU is already connected to many CPTPP countries or negotiating new deals that would provide comprehensive market access. Now, the EU needs to accelerate these efforts. Negotiations with Thailand, Malaysia, the Philippines, and Australia should be concluded promptly, and the agreement with Indonesia should be ratified soon.

In the medium term, these bilateral agreements should be consolidated into an EU-ASEAN agreement. A key issue here is the cumulation of rules of origin – meaning the ability to apply trade preferences to goods produced across multiple countries in the region. This would allow regional supply chains to be more closely integrated with the EU. The EU’s "Global Gateway" strategy should also place greater focus on Asia and support major connectivity and raw material projects. There are plenty of opportunities for close economic ties: what is needed now is political commitment at the highest level from all 39 EU and CPTPP states to ensure that German companies can continue to succeed globally in the future.