Throughout his election campaign, President-elect Donald Trump criticized free-trade deals to the point of threatening to pull out of the Trans-Pacific Partnership (TPP) once elected to office. Trump referred to TPP as a disaster in waiting and alleged that it would hurt U.S. jobs. But it is like President Obama had foreseen a possible backlash against the trade if Trump won. Earlier on and alongside other leaders of the Asia-Pacific Economic Cooperation group, Obama had called for fighting of any counterattack on TPP.
While at this, German Chancellor Angela Merkel seems to share similar opinions with Obama. She is not happy about any possible demise of TPP. In her speech to the German Parliament, Merkel emphasized on the need for a multilateral approach in solving global issues.
Who loses and who gains from the demise of TPP?
Trump’s threats are already a signal of having Obama’s vision to make the TPP the cornerstone of U.S. strategic engagement ragged. All that Obama was after was the liberalization of services trade, state-owned enterprises as well as environmental and labor standards. However, the achievement of all this is now hanging in the balance given Trump’s position about TPP, which has also drawn heavy criticism from pro-traders in the U.S. Surprisingly some of his loyalists in his party are also criticizing Trump’s intentions.
Different people have expressed mixed feelings about the trade policy the new U.S government is likely to offer. Japanese Prime Minister Shinzo Abe, who became the first foreign leader to meet Trump since his win asserts that, TPP is meaningless without the United States. However, Japan is still holding onto hope of a review of the pact.
Is it likely that some TPP members would opt for RCEP?
TPP, which was signed this year in New Zealand includes 12 nations, among them Malaysia, Singapore, Australia, Chile, Mexico, Canada and others. However, it would only take effect after ratification by six countries. But would some TPP members opt for RCEP, which comprises of 10 members of the Association of Southeast Asian Nations?
While this is yet to be answered, U.S. Trade Representative Mike Froman writes, “Unlike TPP, [RCEP] doesn’t raise labor and environmental standards, impose disciplines on government-owned corporations, strengthen intellectual property rights enforcement, or maintain a free and open internet.”