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FINANCIAL TIMES
TPP
deal ignites criticism of US isolation on trade
Pacific Rim countries
press on without America as Trump wins limited gains in Vietnam
Shawn Donnan in Washington and John Reed in Da Nang A
weekend move by Japan and 10 other Pacific nations to press ahead with a
vast regional trade agreement without the US has prompted fresh
criticism that Donald Trump’s “America First” trade policy is leaving
Washington increasingly isolated. The
11 remaining members of the Trans-Pacific Partnership, which the Obama
administration spent years negotiating and Mr Trump pulled out of on his
third day in office, announced on Saturday that they had reached
agreement on the “core elements” of a deal to proceed without the US. The
group still has work to do, as Canada, Malaysia and Vietnam seek changes
to an agreement they have rebadged — at Canada’s request — as the
Comprehensive and Progressive Agreement for Trans-Pacific Partnership. But
officials said the plan was to sign a final agreement early next year,
in a deal that would eliminate the tariffs on 95 per cent of goods
traded in a bloc covering some 500m people and more than $10tn in
economic output.
“This will send out a very strong message to the US and to other
Asia-Pacific countries,” said Toshimitsu Motegi, the Japanese economy
minister. The
announcement came as Mr Trump continued to press the case for a
rewriting of the US trade relationship with countries in Asia via
bilateral trade deals and to push for a new “Indo-Pacific” strategy.
During a weekend meeting with his Vietnamese counterpart the US
president complained about “a very substantial trade imbalance with
Vietnam”. “We
want to get that straightened out very quickly,” Mr Trump said. A
joint statement issued on Sunday after the meeting appeared to point to
limited gains for the US, however. It hailed a Vietnamese move to allow
access for US distillers grains and mentioned continuing discussions on
the trade in products and services including shrimp, mangoes and
electronic payments. The
president and the White House were pointing to the way his Asia trip had
been celebrated in China, Japan and other stops along the way. But
critics charge that, on the trade front at least, the administration
looks increasingly like it is being outmanoeuvred by Beijing and
others. “I
think everyone was polite to him and they want to make him think that
they are all chummy and willing to do things with him. But I have to
think in some ways they are laughing behind his back, and certainly the
Chinese are,” one US business lobbyist told the Financial Times on
Sunday. “I don’t think any of them have any intention of getting into a
deal with him, certainly not on the terms that he wants.”
Michael Froman, who led the US TPP negotiations under the Obama
administration, said that the renewed agreement “shows how our allies
and partners continue to see the value of putting in place high
standards and tearing down trade barriers across the region. Clearly, as
the US retreats, the rest of the world is moving on”.
“This
Administration has spent nearly a year dithering and still lacks any
serious strategy for the engagement with Asia in order to open those
markets to exports of American goods and services,” said Ron Wyden, the
top Democrat on the influential Senate Finance Committee. “Because of
this failure to effectively engage, [American] farmers, ranchers,
manufacturers, and service providers will lose business in the Asia
Pacific markets.”
Matthew Goodman, who has served as a top adviser on Asian economics to
both Republican and Democratic presidents, said the good news about the
remaining members of the TPP pressing ahead was that it would put new
rules on state-owned enterprises and free data flows into practice. It
also left the door open to the US rejoining the agreement someday. “It
does give the US a path back to participating in broader regional
economic integration,” he said. “I don’t think it’s a path that we are
going to follow in the near-term. But at least it’s a path.” |