U.S. President Donald Trump has announced that he will consider rejoining the Trans-Pacific Partnership (TPP), a trade deal he withdrew from in January last year soon after taking office.
In a speech at the World Economic Forum Annual Meeting in Davos, President Trump said the United States “would consider negotiating [the TPP] if it is in the interests of all [countries].”
Advocating an “America First” policy, Mr. Trump has consistently turned his back on multilateral frameworks, including the TPP and the Paris climate pact on global warming. If he has changed his policy, we would welcome it.
If the United States were to return to the TPP, the trade pact would become an exceptionally large free-trade bloc, as participating countries would go from representing slightly over 10% to accounting for roughly 40% of the world’s economic output. It would probably contribute to stability in the Asia-Pacific region as well.
President Trump’s real intentions are not clear, though. Although he mentioned returning to the TPP, it cannot be said that he has abandoned his protectionist philosophy, under which he prioritizes U.S. interests over international trade rules.
Saying that imports of solar panels and large residential washing machines have been rising dramatically, the Trump administration announced this month that safeguards would be imposed based on Section 201 of the Trade Act. The United States has not imposed safeguards since the Bush administration in 2002, and the World Trade Organization (WTO) ruled against them at that time, saying they were in violation of the agreement. This time, China and South Korea, which would be heavily impacted by the safeguards, are protesting strongly.
It is also impossible to tell when a conclusion will be reached to the renegotiation of the North American Free Trade Agreement (NAFTA) with Canada and Mexico, as the United States is insisting on reducing its trade deficit.
In an interview with a U.S. television station prior to the World Economic Forum, Mr. Trump said, “I would do TPP, if we made a much better deal than we had.” He is prepared to seek renegotiation of the TPP with the aim of making it advantageous to the United States. The U.S. would probably press Japan to further open its markets, including its agricultural products market.
The TPP took over five years to negotiate due to conflicting interests and has been called “glasswork” [because it is so intricate]. If even small changes are made, it would be difficult to again reach an agreement. If the trade pact is renegotiated, there is a chance it will not come together.
The 11 non-American countries have just decided to hold a signing ceremony for the TPP in March after reaching a final agreement on a new pact that takes some items that were incorporated at the initiative of the U.S. and freezes them until America rejoins the fold.
First, the 11 nations should hurry to sign the pact and perform domestic procedures with an eye to having it come into force. It is important the 11 nations consolidate their position and then face the United States.
Prime Minister Shinzo Abe is proud of having a close relationship with President Trump. Abe should be persistent in persuading Mr. Trump that reviewing his “America First” policy will lead to his nation’s return to the TPP.