In the article “Peru’s New Leader Champions Trade in the Trump Era” (https://www.ft.com/content/2e2af8ee-b293-11e6-a37c-f4a01f1b0fa1) , an overview is given of Peru’s trade strategy now that the TPP will most likely be stopped. Per the article, Peru’s president Pedro Pablo Kuczynski believes that it is “fundamental that world trade grows again and that protectionism be defeated”. Currently Peru’s top trading partners are China and the US. Although Kuczuynski confirms that Peru’s relationship with the US remains strong, he is “seeking to deepened ties with Beijing”. Additionally, the day after Trump vowed to scrap the TPP, Peru hosted the Chinese president Xi Jinping. Although Kuczynski hasn’t totally given up on the TPP, he stated that Peru is “considering the merits of a rival Chinese initiative, the Regional Comprehensive Economic Partnership”, which is essentially a new TPP reformed to exclude the US. How many countries would wish to participate in such an agreement? Would the US discourage such an agreement? Only time will tell.
In the wake of Donald Trump winning the election to be the next President of the United States, there are discussions currently ongoing about how that will affect the TPP agreement. Will he scrap the deal as he promised to do during his campaign? How would he do that? Would it be a popular decision?
In the article Singapore disappointed TPP is unlikely to be passed under Donald Trump: PM Lee, the author seeks to examine Singapore’s stance on the TPP given that Donald Trump is now the president elect in the United States. As I’ve written before, the US is the pivotal player in the TPP deal. If the US does not ratify the TPP, it is highly unlikely the deal will be ratified in other countries, including Singapore. Singapore has been a stark supporter of the TPP, and it’s not surprising that with the prospect of the TPP fading, Singapore has voiced public disappointment.
As another indication that the world was watching the US election, Singapore’s Prime Minister Lee indicated he was well aware of Donald Trump’s stance on the TPP. Lee’s exact word were that Trump “had no sympathy for the TPP at all.” Singapore’s main reason for its pro-TPP stance is that it would to enjoy lower tariff and non-tariff barriers for both goods and services, but Singapore is also a very small player in the grand TPP scheme. The TPP accounts for 40% of global trade amongst its participating countries. PM Lee has also noted previously that not ratifying the TPP would make the US lose credibility with countries around the world.
Moving forward, it looks like Singapore’s stance on the TPP is all or nothing. When PM Lee was asked if the deal could be amended to add new countries like Russia or China, he responded that the deal would be a completely new animal. He called such a deal a “new exercise,” a strong indication that the deal as it is right now is the only way Singapore would like to see the deal ratified. As President elect Trump begins to enact his policy, the world will be watching with interest to see how deals such as the TPP created under the Obama administration will be handled. If Trump does keep any of his campaign promises, it will not be surprising if the TPP is completely scrapped.
What countries will be involved if a new TPP style deal is crafted?
Will there be significant global fallout if the TPP is not ratified in the US?
How much consideration should Trump give to smaller countries like Singapore as compared to the larger countries not in the agreement such as Russia and China?
In this article we will discuss the impact of TPP on Australia.
Over the long term, Australia would probably benefit from increased productivity and access for Australian industry to parts of Asia that are currently closed to it. However, the advantages for Australian consumers are not that obvious.
SUGAR– One of the most lucrative markets that Australia wants access to is America’s sugar consumers but this may be a struggle as the US sugar lobby is very powerful.
DAIRY- The US and New Zealand all want more access to Canada’s milk market, which the government has traditionally restricted supply to thereby keeping prices high.
MEDICINE- Currently, the government sets the highest price and also subsidizes the cost of these medicines. But the US wants the market to be less regulated to benefit new medicine manufacturers.
REGIONAL COOPERATION- Members of the TPP account for nearly 40 per cent of the global GDP and Australia would benefit from being part of the regional supply chain.
Many of the sweeteners that Australia are hoping for, including access to America’s sugar consumers and to Canada’s dairy market, are probably unlikely to happen. This has some National MPs starting a “no sugar, no deal” campaign, which demands Australia abandon negotiations if access to new sugar markets is not included. Also, there is speculation that the US could be using the agreement as a way of limiting China’s expansion. This has triggered a rival Chinese deal, the RCEP, which excludes the US and which Australia is also involved with.
The American Farm Bureau Federation has released a state-by-state analysis of the economic impact of the Trans-Pacific Partnership trade and investment agreement. Nationally, the American Farm Bureau Federation estimates annual net farm income will increase. In Indiana, the TPP agreement is expected to increase cash receipts and net exports. It will also lead to increased marketing opportunities for Hoosier farmers and add jobs to the Indiana economy.
In a recent article on the website, The Cattle site, the impact of the U.S. waiting to approve the TPP deal on trade, is discussed. The only country to approve the TPP to date is Malaysia. Since there is no deal in place, tariffs on U.S. exports are extremely high. This is particularly crippling on the agricultural sector, as almost one third of gross agricultural income is through exports. The Japanese and other countries are concerned with what the U.S. will do with regard to the approving the TPP deal and are in a nervous “wait and see” mode. How can U.S. agriculture come out without too much loss? What will the U.S. ultimately do with respect to the proposed TPP deal? How will other countries respond to the U.S.’ actions?
In the article, Ratifying the TPP could be bad for Canada, but not ratifying it would be even worse: memo, the author examines the multiple options around the TTP as well the future of trade in Canada. As most know, the TTP has been signed by all the countries involved, but it has yet to be ratified. With growing sentiment against the TTP in the US, Canada, and other countries, it’s not surprising that some experts believe the agreement may never be ratified.
The previous finance minister of Canada, Joe Oliver, warned Canada in an October memo that not participating in the TTP could be disastrous. In part, Canada needs to be part of the agreement if only for defensive measures. If Canada were to opt out of the TTP, it would lose its ideal trade positions to the US and Mexico. The memo noted specifically that these North American supply chains “underpin the [Canadian] economy. On the positive side, the TTP would open the doors to trade with Asian countries, a position Canada does not hold strongly right now.
On the flip side, the TTP would dilute Canada’s great position within the NAFTA. There would be significant competition from Asian countries. Furthermore, the TTP could eliminate Canadian jobs and damage some sectors of the economy. Interestingly, Nobel Prize-winning economist Joseph Stiglitz has urged Canada to abandon what he described as a “badly flawed” deal. Suffice to say, the future of the TTP is in doubt.
Would the dissolution of the TTP be the best outcome for Canada?
Why hasn’t there been more sentiment in Canada about the TTP’s other provisions aside from trade?
Will Canada’s relations with Asian countries actually become worse if the TTP is not signed?