In the Indo-Pacific, trade agreements have never been just about tariffs. They are vehicles to set standards and rules; to decide who sets the templates for digital trade, state-owned enterprises, labour and environmental rules, quality standards, investment protection, and the “plumbing” of cross-border commerce. In 2016, many observers expected a fairly clear hierarchy to emerge. A decade later, that hierarchy looks very different: it has fractured into a competitive, overlapping patchwork of rulebooks.
What 2016 Looked Like: Big Expectations, One Presumed Rule-Writer
In 2016, the spaghetti-bowl of mega-regional and bilateral trade agreements in the Indo-Pacific looked as depicted in Figure 1.
Figure 1: TPP, no RCEP, and EU bilaterals in 2017
Source: Own compilation.
The Trans-Pacific Partnership (TPP) – negotiated with the United States as a central architect – was widely viewed as the vehicle through which Washington and partners would set the “gold standard” for 21st-century trade rules in the Indo-Pacific, especially on services, digital trade, intellectual property rights, and disciplines on state influence in the economy. That expectation collapsed abruptly when the United States formally withdrew in January 2017.
At that time, the Regional Comprehensive Economic Partnership (RCEP) was still being negotiated, but it was already understood then, that RCEP would be a much more incremental, ASEAN/China-centred framework, focused on market access and trade facilitation rather than strong, enforceable “behind-the-border” disciplines (notably lacking labour and environment provisions).
For the EU, in 2016, the EU-Indo-Pacific trade network was forming (i.e. negotiations were ongoing) but not yet visible as a competing regulatory pole: the only Asian economy with an EU FTA was South Korea, negotiations with India had stalled and EU-ASEAN negotiations were halted, in part due to large divergent asks of the different ASEAN trade partners.
In 2016, because the EU’s “deep agreement” model (pairing market opening with regulatory cooperation and sustainability disciplines) was advancing but far from complete, and because RCEP was not yet in force and not focused on deep, regulatory alignment-driven standards, the centre of gravity of “Indo-Pacific rule-writing” was widely assumed to be US-led via TPP as shown in Figure 1. But a lot has happened since then.
The Indo-Pacific in 2026: CPTPP Survives, RCEP Scales, EU Bilateral Networks Deepen, While US Shifts Tools
Jump 10 years, to 2026, and the Indo-Pacific has become a very different place, economically, regulatorily and geopolitically.
Economics
Today’s Indo-Pacific trade architecture is defined by two mega-platforms and an expanding set of deep bilateral agreements:
Figure 2: CPTPP, RCEP and EU bilaterals in 2026 – a new reality
Source: Own compilation.
The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) (the successor agreement after US withdrawal) entered into force in late 2018 and has progressively expanded geographical coverage, including the UK joining in December 2024, the first European member. CPTPP members, at the end of 2025, represent a combined GDP of US$15.8 trn. RCEP entered into force in 2022 and now covers a massive share of Asia-Pacific trade, including China, Japan, South Korea, ASEAN, Australia and New Zealand, making it the region’s broadest singular tariff-and-supply-chain platform. RCEP, end 2025, represents approximately 30 per cent of global GDP (around US$26-29 trn). The EU has built a dense Indo-Pacific-facing bilateral network and recently concluded the EU–India FTA (26 January 2026), alongside major agreements with Japan (in force 2019), Singapore (2019), Vietnam (2020), and New Zealand (2024), with several-trans-pacific partners also: Canada, Mexico, Central American nations, ANDEAN countries, and Chile. The total combined GDP of the EU-FTAs is between US$41 – 43 trn (including India).
The economic implications of these developments are several. First of all, market access dynamics have changed, with the trade agreements ‘competing’ with each other. For example, Japan joining CPTPP meant that EU firms lost relative access and Japan joining RCEP meant that EU firms lost even more relative access compared to Asian competitors. This was remedied by the EU-Japan EPA, levelling the playing field. Second, firms increasingly operate under multiple overlapping trade agreements, each with different rulebooks, choosing supply-chain routes, investment locations, and compliance strategies based on which Agreement offers the most predictable access and lowest regulatory friction.
Regulatory Approaches
Competition between the three main trade frameworks in the Indo-Pacific is less about “who has the biggest market” (though that matters) or just market access, but at a deeper level about which approach has the strongest transformative power when it comes to 21st century rules and regulations and which of the three regulatory templates scales most.
CPTPP’s model remains the “high-standard” benchmark across several domains, and it does so across all CPTPP’s members, but it is also a modified benchmark: after the US exit, members suspended a set of provisions, many tied to US preferences, especially in intellectual property. The CPTPP scales because the “high-standard” benchmark is applied multi-regionally to its large and smaller economy-members. RCEP’s model is wider but definitely shallower: it standardises rules of origin across members and improves trade facilitation, but is generally less prescriptive on labour standards, environment, behind-the-border-measures, and certain governance disciplines. Due to its wide coverage, including some of the largest production economies in the world, RCEP is able to scale strongly. The EU’s bilateral model also sets the bar with “very high-standard” agreements, but does so bilaterally. The EU pushes a different kind of regulatory leadership to the other two multi-regionals: a blend of market access plus regulatory cooperation, strong emphasis on standards, conformity, SPS/TBT disciplines, and a sustainability “floor.” The EU is also increasingly exporting digital trade disciplines through targeted digital agreements (e.g. the EU–Singapore digital trade deal announced in 2024). However, because the Agreements are all bilateral, they only scale between the respective trading partner and the EU, not between the Asian trading partners of the EU among themselves. While GDP coverage of the combined EU FTAs is the largest, their bilateral nature puts a significant limit on scaling.
Geopolitics
This is where the 2016 expectations flip most sharply. The US withdrawal from TPP created a vacuum in mega-FTA rule-writing that Japan and other partners helped fill by keeping CPTPP alive, while RCEP’s entry into force consolidated a parallel economic centre of gravity in Asia. The EU uses its bilateral trade strategy to try to regain market access and exert regulatory clout. Meanwhile, the US has shifted toward alternative instruments (mini-deals, sectoral arrangements, supply-chain and tech controls, and frameworks outside classic FTAs). The net effect is that Indo-Pacific partners now navigate a multipolar regulatory landscape: CPTPP standards in one lane, RCEP integration in another, EU deep bilateral rule-export in a third, and US influence often exercised through strategic/technological policy rather than comprehensive trade agreements.
This fragmented landscape in terms of rules-setting in the Indo-Pacific is determined both from within Asia (RCEP, CPTPP) and by large non-Asian trading partners (e.g. EU with bilateral FTAs, US with alternative instruments). The potential to fundamentally alter the rules-setting landscape in the Indo-Pacific can come from several directions. First, any rapprochement between RCEP and CPTPP could be game-changing. Second, the EU and its bilateral trading partners considering turning the many bilaterals into one multi-regional in the Indo-Pacific would change the rules of the game. Third, the EU and US collaborating with each other and possibly CPTPP could set the ‘gold standard’ on rule-making in the Indo-Pacific. While all these alignment options are faced with very significant challenges, the result could lead to who would end up setting rules in the Indo-Pacific and possibly even globally.
Conclusions
In 2016, the “competition for regulatory leadership” was expected to be won through a US-led TPP that would set the region’s default rules. In 2026, regulatory leadership is contested and modular: CPTPP provides high-standard templates; RCEP provides scale and supply-chain integration; and the EU’s expanding network, now including the EU–India FTA, projects a distinctive regulatory model into the Indo-Pacific that entrenches itself into the Asian partner domestic legal frameworks. The result is not one rulebook, but a race to shape the interoperable rules that will govern Indo-Pacific commerce for the next decade.
Different alignment options could alter this fragmented landscape and tilt the current balance to one of the regulatory frameworks, that could end up setting the rules in the Indo-Pacific. For the EU, that leads to the question of what policy options it could pursue to strengthen its position in the region as a standard-setter.