Trump orders TPP withdrawal

Donald Trump has signed an executive order that will pull the US out of the Trans-Pacific Partnership Agreement, as signalled in his campaign.

He has warned business leaders he will impose “very major border tax” if companies move their manufacturing out of the US. Unless he also acts on the huge number of companies who already manufacture outside of the US this will give existing off shore manufacturers a big price advantage.

He has also said he intends slashing company tax rates from 35% to 15% or 20%.

BBC: Trump executive order pulls out of TPP trade deal

President Donald Trump has fulfilled a campaign pledge by signing an executive order to withdraw from the Trans-Pacific Partnership (TPP).

During his presidential campaign, Mr Trump criticised the TPP as a “potential disaster for our country”, arguing it harmed US manufacturing.

“Great thing for the American worker what we just did,” said Mr Trump as he dumped the pact with a stroke of a pen.

This was well signalled.

He also cut funding for international groups that provide abortions, and freezed hiring of some federal workers.

Also on Monday morning, Mr Trump pledged to “massively” cut regulations and taxes on companies, but impose “a very major border tax” if they move factories outside the US.

“All you have to do is stay,” he told executives from 12 companies including Lockheed Martin, Under Armour, Whirlpool, Tesla and Johnson & Johnson.

After meeting the business leaders in the White House, Mr Trump pledged to lower corporate taxes to 15% or 20%, from the current 35%, and slash regulations by up to 75% if they keep jobs in the US.

As promised Trump will radically change business and trade regulations, tariffs and taxes for the US. How this will affect the US and the rest of the world is unknown – there is certain to be negative effects and unintended consequences.

When the world’s largest economy gets a good shake up it’s anyone’s guess what will froth over the top.

Japan, Australia still backing TPP

After an official meeting the leaders of Japan and Australia have said they were committed to proceeding with the Trans-Pacific Partnership agreement.

RNZ: Japan, Australia both back TPP

Japanese Prime Minister Shinzo Abe and Australian Prime Minister Malcolm Turnbull made the announcement after their official meeting as part of Mr Abe’s four-country trip to boost Japan’s trade and security in the Asia-Pacific region.

In his first visit to Australia since Mr Turnbull became Prime Minister, he said both leaders were committed to ensuring the 12-country TPP trade deal would come into effect.

“On the economic front we agreed that we should demonstrate anew the importance of free trade,” he said.

“We confirmed that we would coordinate toward the early entry into force of the TPP and the prompt conclusion of the RCEP [Regional Comprehensive Economic Partnership].”

There is still a major problem though – Donald Trump has said made a priority of taking the US out of the TPP.

The commitment came despite United States President-elect Donald Trump criticising the TPP as a “potential disaster” for the US and vowing to prioritise withdrawing from the pact.

Mr Abe, who had previously said the TPP would be meaningless without the US, said the countries also agreed to maintain “solid cooperation” with the Trump administration.

NZ Herald report that Bill English says a rethink on the TPP may be necessary in Bill English optimistic about Donald Trump US presidency

One of Trump’s first acts will affect New Zealand’s interests – Trump has pledged to initiate the US withdrawal from the Trans Pacific Partnership on his first day in office.

Australian PM Malcolm Turnbull and Japan PM Shinzo Abe met recently to discuss how to salvage the TPP and English said he was not ready to give up altogether either.

“I wouldn’t say it is futile, but I think along with those countries, we need to rethink our approach. It could be as soon as next week that the US executes its position and that means we need to rethink it.”

“I would hope there would be a way of keeping the US engaged in the Asia Pacific and the TPP certainly would have done that. There may have to be some adaptation or some other way of doing that.”

‘Rethink’ may mean trying to do a TPP without the US, unless Trump makes a major reversal on his stance.

Trump confirms US withdrawal from TPP

Donald Trump has announced that in his first day in office as president he will initiate a US withdrawal from the Trans-Pacific Partnership. He has already indicated this would happen.

Stuff: John Key responds to Donald Trump’s decision to quit TPPA: ‘The US isn’t an island’

Calling the 12-nation agreement “a potential disaster for our country,” the president-elect said he would file a notification of intent to withdraw from the deal pushed by President Barack Obama as soon as he takes office on January 20.

Prime Minister John Key has also said the US cannot just sit there and not trade, particularly with the fast-growing markets in Asia.

“The US isn’t an island, it can’t just sit there and say it’s not going to trade with the rest of the world.

“At some point the US would want to think about how it accesses those very fast-growing markets in Asia, and what role it wants to have in Asia.”

So it is now up to the other eleven countries to work out what they want to do with there. A modified agreement will presumably be necessary id things are to proceed without the US.

Or seek a bilateral agreement with the US. Trump said he would pursue ‘free trade’ agreements instead that suited the US better.

New Zealand would want to be near the front of the queue for talks with the United States about any bilateral trade agreement, Trade Minister Todd McClay says.

“Obviously, if the Trump administration wanted to look at new, bilateral FTAs, we would be keen to be near the front of that queue.”

McClay said despite this, the TPPA would still be the country’s first FTA with Peru, Mexico, Canada and Japan.

I expect that the US under Trump’s leadership will have greater priorities than a trade deal with New Zealand.

TPP without the US?

When Donald Trump was elected US president it was presumed the Trans-Pacific was history, but it’s possible the other eleven countries will go ahead without the US.

This would presumably require another agreement because the current agreement was dependant on the US ratifying it.

Stuff: TPP nations eye a future without the US with Trump in the White House

Leaders of the Trans-Pacific Partnership nations are openly considering going it alone, without the United States, in a so-called ‘TPP minus one’ in the wake of Donald Trump’s election.

The 12 countries are meeting on the margins of the 21-strong Apec meeting in Lima, Peru.

Talking to reporters shortly after arriving in the Peruvian capital, Prime Minister John Key made it clear the grouping faced a critical crossroads with Trump’s election.

.”Maybe it is one of the most important Apecs I have been to.”

It could be interesting, but I would be surprised if the US is in a position to make decisions or even give an indication where they stand as Trump transitions into the White House.

There were three scenarios: Go ahead without the US with an 11-member TPP, Trump changes his position and accepts the agreed text, or the countries go back to the table and start talks again.

New Zealand’s goal was a free trade agreement that included the US and Japan through the TPP. 

But a deal without the US, but with Japan would still be worth it from New Zealand’s point of view.

A meeting of TPP leaders is planned for Sunday and New Zealand was reserving judgement on a ‘TPP minus one’, he said.

“It might be, in the end, the way we go forward without the United States – that’s  not an impossible scenario. But we have a few years to make that decision.”

If they want to proceed with a Pacific trade partnership it looks like it will have to be minus the US.

If this is what ends up happening it will be interesting to see how many still oppose it because it’s a trade agreement, and whether some decide to switch to supporting it without the US being involved.

TPPA trumped

Meanwhile, in New Zealand the Trans Pacific Partnership legislation is down to pass into law today …….

Stating the obvious:

BREAKING NEWS – John Key admits TPP will not happen in the short-term with Donald Trump in the White House

John Key is doing well articulating the future NZ relationship with Trump: we don’t have to like it, but we do have to make it work

Key claims TPP is 50:50

Yeah, right.

John Key said yesterday that he thinks there is a 50:50 chance of the Trans-Pacific Partnership getting passed by the US congress in the lame duck period (after next week’s election and before President Obama’s term expires on 20th January 2017).

Audrey Young: John Key says TPP has a 50:50 chance of being passed in Congress lame-duck period

Prime Minister John Key believes the TPP still has a 50-50 chance of being passed in the lame-duck Congressional period after the November 8 presidential election.

He says a lot would depend on the direction given by Congress’ top ranking Republican, Speaker Paul Ryan, and whether Democrat candidate Hillary Clinton won the election.

“I think if Donald Trump wins it’s got no chance But if Hillary Clinton won there is a possibility and a window.”

But there was definitely a view out of Washington from some people that it would go ahead.

“I think it’s a bit 50-50 myself.”

I think that’s a bit optimistic. There is a possibility it will pass through Congress in the next three months. There is also a possibility sanity will prevail in the presidential election. Both seem like extreme long shots.

Trump and Clinton both oppose the Trans Pacific Partnership trade deal among 12 countries and signed in New Zealand in February.

It could pass in the lame duck period. Ryan said in August that the numbers weren’t there although “Inside US Trade” reports that the Obama Administration is close to a solution on the biologics part of the TPP deal that has upset Republicans.

If Clinton wins but there would be an uproar from Sanders supporters and Trump supporters, and probably extreme pressure on both Republican and Democrat representatives.

 

Flogging a dead TPPA?

On his trip to new York John Key has been promoting the Trans-Pacific Partnership Agreement. Is the TPPA a dead horse?

Today’s Herald editorial still thinks the TPPA is worthwhile – Key plays a strong geopolitical card on the TPP

John Key stated it as plainly as he dared in New York yesterday: failure to ratify the Trans-Pacific Partnership agreement would be a “massive lost opportunity” for the United States, he said, “because in the end is that vacuum isn’t filled by the United States, it will be filled by somebody else”.

He could have gone further and suggested the “somebody else” could be China. Talks involving China, India, Japan, South Korea, the Asean members and Australia and New Zealand are under way on a project called the Regional Comprehensive Economic Partnership.

Key had no need to spell out the implications to his New York audience, the Council for Foreign Relations, but his real targets are in Washington. Some of them – but not all – are seeking re-election for Senate and House seats. Some will be defeated at the elections on November 8, but all of them retain their seats until the next Congress is sworn in late in January. That “lame duck” period is a chance for legislators to do what is right, though it may not be popular.

Americans are well accustomed to their representatives doing this and they do not protest vehemently enough for the practice to become politically untenable. It almost seems to have tacit approval. The American public and the incoming Congress appear to accept that contentious things need to be done when the Constitution provides the opportunity.

Both presidential candidates say they want to renegotiate the TPP. Hillary Clinton will know, if Donald Trump does not, how long it took to get the TPP to the point of agreement and how hard it was. It would do the partners no harm to indicate to American voters that a renegotiation cannot be taken for granted.

The TPP has not come from nothing. It grew out of the World Trade Organisation’s stalled Doha round, which itself resulted from collapse of communism and almost universal realisation that competitive markets are the source of prosperity. If the US turns inward and protectionist under its next President, trading countries will look elsewhere for global progress.

Is Key wistfully whistling in the Washington wind?

What he or the Herald say will hardly sway the  USA.

Is the TPPA a lame duck or will the lame duck period givbe it another gasp of breath?

Obama to push TPP

President Obama has said that he will try to push the Trans Pacific Partnership Agreement through Congress, despite both presidential candidates publicly strongly opposing the trade deal.

Newshub: Obama set for ‘full-fledged’ TPP push

US President Barack Obama is launching “a full-fledged, full-throated effort” to push the Trans-Pacific Partnership mega trade deal through Congress in the final lame duck months of his presidency.

The TPP would be the final landmark piece of Mr Obama’s presidency.

“This will be a full-fledged, full-throated effort,” Mr Obama’s deputy US trade representative, Robert Holleyman, told an event this week at Atlanta’s Commerce Club.

The Atlanta event reflected the huge divide between TPP supporters and critics in the US.

David Abney, the chief executive of the world’s largest package delivery company UPS, talked up what he believed would be the TPP’s ability to cut red tape for US small and mid-sized businesses entering new Asia-Pacific markets.

As Mr Abney spoke, UPS drivers and union representatives supporting them protested outside the Commerce Club.

“We’re opposed to the TPP because we feel like it’s going to undermine American workers’ standard of living,” Teamsters Local 728 political director Eric Robertson told theAtlanta Journal-Constitution.

Mr Obama has put Congress on notice he will be sending a TPP bill their way.

The White House has also organised 30 pro-TPP events to support Democrat and Republican members of Congress who favour the legislation.

It will be difficult for Obama. He hasn’t much time left in his second term, and has to get the TPP through in the ‘lame duck’ period after the election and before he leaves the White House in January.

TPP a victim of US election?

It’s looking increasingly likely that the Trans Pacific Partnership Agreement may be a victim of the presidential campaign in the US.

If the US doesn’t ratify the TPPA it fails.

Hillary Clinton and Donald Trump are both speaking strongly against the TPP in their campaign rhetoric.

President Obama’s hopes of slipping it through ratification in the lame duck session between the election on November 8 and the inauguration of the incoming president on 20 January 2017.

Patrick Gower has been attending both the Republican and Democrat conventions and writes: Opinion: The TPP is dead and gone

The Trans-Pacific Partnership (TPP) trade deal is dead and gone and it is thanks to Donald Trump and Bernie Sanders.

Trump is dead against it.

Sanders is dead against it.

I’ve actually been really surprised at the level of visceral opposition towards the TPP from both sides here.

Each time both Trump and Sanders have bagged the TPP, there have been huge roars from the Republican and Democratic Convention crowds. 

And the power of both the Trump and Bernie movements mean it would be political suicide for United States politicians to go against them right now and ratify the TPP.

Powerful sectors of both sides of politics are against it – and you never, ever hear anything from its supporters in either the Republicans or the Democrats.

The TPP has been burned on the political firestorm that is raging here.

Big numbers of Republicans are dead against the TPP.

And I can tell you that huge numbers of Democrats are against the TPP.

If Hillary wins, she won’t want to deepen the divisions with her party by passing it.

As for a Trump win, well – say no more.

TPP supporters will bang on about all the possible machinations but the simple fact is this: The politics in America is against the TPP – and politics always wins in the end.

Maybe an ‘adjusted’ deal will re-emerge but the TPP as we know it is dead and gone.

Perhaps the other eleven countries will have to do it without the US. It was always going to be difficult getting it ratified there due to huge commercial lobbying interests trying to protect their markets and subsidies.

But that will take a lot of time, if there is any appetite to restart negotiations.

It looks like the TPPA could be a dead duck, blasted by a double barreled election shootout.

Democrats softening on TPPA?

Some predicted that US presidential campaign rhetoric in opposition to the Trans Pacific Partnership may not match post election realities.

There’s a sign that the Democrats may be not as staunchly against it as Hillary Clinton has previously appeared as they get closer to having to put together a policy package.

As usual money often speaks the loudest in the US.

New York Times:  Bernie Sanders Allies Lose a Fight Over Democrats’ Stance on Trade

Allies of Hillary Clinton and President Obama on Saturday beat back an effort by the Bernie Sanders campaign to have the Democratic Party officially oppose a congressional vote on the Trans-Pacific Partnership trade deal.

At a sometimes-raucous meeting in Orlando, Fla., of the party’s platform committee, which is drawing up policy goals for the Democratic National Convention this month, lieutenants of Mr. Sanders argued that the trade deal would lead to a loss of jobs and competitive wages and that it would ultimately harm American workers and labor unions.

Given that Mrs. Clinton, the party’s presumptive presidential nominee, has said she opposes the trade deal, the Sanders allies argued that her supporters on the committee should agree to try to block any congressional vote to ratify the agreement.

But opposing a vote on the partnership would line up the party against Mr. Obama, who is championing the deal and who endorsed Mrs. Clinton last month. Her allies on the platform committee regarded the Sanders effort as a rebuke to the president and merely a symbolic move because the committee cannot dictate to Congress.

Politics can be complicated in the US.

And from The New Yorker in BERNIE SANDERS’S PHILOSOPHICAL VICTORY:

It bears repeating that Sanders didn’t win all of the platform battles. Indeed, a cynical way to interpret the Clinton campaign’s stance is that it has given Sanders the language he demanded on some issues while maintaining the flexibility that it wants, and that its big donors want, in other key areas, such as trade and energy.

Over the weekend, the platform committee rejected language that would have condemned the proposed Trans-Pacific Partnership and opposed its being put to a vote in Congress.

The committee approved milder language that doesn’t single out the T.P.P. but, rather, simply says that all free-trade deals should include standards that protect U.S. workers.

“Maintaining the flexibility that it wants, and that its big donors want, in other key areas, such as trade and energy.”

The overwhelming influence of money in the US may rule on the TPPA outcome.