Beefy Boost

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?

If Trump has His Way, Singapore Will Lose Out if TPP Not Ratified

In the article, How Donald Trump’s views on the TPP could sink Singapore, the author examines a Trump presidency could would affect the TTP as well how the TPP, or lack thereof, will affect other countries in the Pacific, mainly China.  The TPP involves 12 countries that account for approximately 25% of global exports and 40% of world GDP, so the deal is very significant.  Furthermore, the World Bank predicts each participating countries’ GDP will climb by 1.1% by 2030 should the deal come into being.  With the ratification or dissolution of the TPP, Singapore stands to gain much or experience significant losses.

Donald Trump’s recent comments on the TPP and China may have some truth to them.  He believes China will attempt to take advantage of its position as not being part of the TPP and initiate back door trading with the countries involved, including Singapore.  China stands to lose out on $46 billion worth of investments and trade each year if the TPP is ratified.  Interestingly, China already has a free trade deal with Singapore.  That being said, Singapore stands to lose much given the fact that total trade as a percentage of GDP is over 300%.  For comparison, the number is just 28% for the US.  So the TPP not being ratified could seriously hurt Singapore’s economy.

In 2015, Singapore was China’s second favorite investment destination.  China actually has free trade deals with two-thirds of the countries in the TPP agreement.  These previously existing deals insulate China a bit should the TPP be ratified.  Unfortunately, a country like Singapore does not have these deals in place.  It’s not surprising Singapore has very publicly supported the TPP, and no matter which US presidential candidate is elected, Singapore will continue to push for ratification.  If Trump is elected, it will be interesting to see if he completely scraps the TPP as he says he will even in the face of serious objections from countries with high vested interest like Singapore.

 

Do you believe Trump is telling the truth about how he feels about the TPP?

With China not being a part of the TPP, does Trump actually have a valid point?

What will Singapore do if the TPP is not ratified?

http://sbr.com.sg/economy/commentary/how-donald-trumps-views-tpp-could-sink-singapore

Deal or No Deal?

In a recent article in, The Wall Street Journal, the ratification of the TPP by the involved countries is discussed. Japan is making a strong push to have their parliament ratify the TPP deal to help gain momentum for the deal in the US. Without the support of the US, the deal dies, and President Obama’s support is crucial to the deals ratification before he leaves office in January. The deal would help to open up free trade in the Asia-pacific region and eliminate costly tariffs for all parties, especially Japan. Will the deal get done in time? Will the US government ratify the deal if Japan does? What will be the implications if the deal doesn’t get approved by the 12 members?

Japanese Rice Getting Cheaper?

In a recent article in, The Japan Times, the author discusses the need for Japanese farmers to produce cheaper rice. With the signing of the new TPP deal, Japan will see an influx of international products flood their domestic markets. This is especially true in their agricultural sections. The Japanese government is teaming up with local farmers to produce cheaper and more cost effective rice, in an effort to be more competitive in overseas markets. In what ways can Japanese farmers produce a cheaper product? Will this approach work? How may this strategy affect the quality of the rice?

Which Canadian agricultural companies stand to reap big rewards from the TPP trade deal

An article in Financial Post (April 26, 2016) titled “Which Canadian agricultural companies stand to reap big rewards from the TPP trade deal” (http://business.financialpost.com/investing/which-canadian-agricultural-companies-stand-to-reap-big-rewards-from-the-tpp-trade-deal) discusses the Canadian economic sectors that will and will not benefit from the TPP, as well as analyzes the agricultural companies that are expected to gain the most from this commercial deal. 65% of the current agricultural exports are destined to TPP members, meaning that the reduction of tariffs associated with this deal is expected to increase additional demand from these trading partners. On the other hand, the TPP is expected to have a negative impact on sectors such as textiles apparel, chemicals and metal products. The National Bank Financial has reviewed the companies in the agriculture space and has concluded that the ones that should gain the most from the TPP include AGT Food and Ingredients Inc. (AGT), Input Capital Corp., Cervus Equipment Corporation and Rocky Mountain Dealership Inc. Will the benefits of the agricultural sector outweigh the tradeoffs that this commercial deal will represent to the Canadian economy?

Earthquakes Delay TPP Approval

In a recent article in the, Japan Times, the topic of a delayed approval by Japan’s legislature is explored. Due to the recent earthquakes in Kyushu, the Japanese Legislature has pushed back discussion on the TPP to deal with the current national crisis. Because the legislature is not planning to extend the the legislative session, this will delay the TPP approval discussions until parliament is reconvened.  Both of Japan’s majority parties will meet to discuss the best solution going forward, with respect to the TPP talks. How might this delay affect the current structure of the deal? How will this impact other TPP members?

The TPP: A Win for Vietnam’s Workers

An article in The Diplomat (April 20, 2016) titled “The TPP: A Win for Vietnam’s Workers” (http://thediplomat.com/2016/04/the-tpp-a-win-for-vietnams-workers/) describes the relevance that the TPP commercial deal represents for Vietnam’s workers and community. Vietnam has refused to commit to labor requirements until now. The TPP is the first agreement that subjects Vietnam to important labor commitments such as freedom of association, minimum work conditions, and collective bargaining. The TPP parties are required to comply with the International Labor Organization’s Declaration on Fundamental Principles and Rights at Work, giving the chance to Vietnam’s workers to finally organize unions independent from the Vietnam’s General Confederation of Labor (VGCL). In this way, it is expected that the TPP will push for a better civil society in Vietnam. What tradeoffs may these actions have on the overall Vietnam’s economy? Will more freedom be translated into more productivity in the country?