Bye bye US, Ni hao China for TPP

Looks like Donald Trump is going to abandon the TPP, fair enough, now we can go invite China in.

Donald Trump says he’ll begin to withdraw the United States from the Trans Pacific Partnership trade deal on his first day in office.

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.

Instead, Trump, who had long flagged he would dump the TPP, said he would pursue “fair” bilateral trade agreements.  

New Zealand and Australia are two of the signatories to the TPP and the issue had been discussed at the APEC leaders forum in Peru last weekend.

Trump was deeply opposed to the TPP in campaigning but NZ Prime Minister John Key had harboured slim hopes Trump might have a change of heart.

“I don’t think we should abandon the hope of getting a free trade agreement with the United States…once Donald Trump is sworn in…then I think we’ll sit around the table and work out the best way forward,” Key said on Thursday.

The deal was signed by trade ministers from 12 Pacific rim countries – although not China – in Auckland in February, concluding seven years of negotiations.

Australian Prime Minister Malcolm Turnbull had also been optimistic.

“It may well be over time that the TPP is embraced by the United States… perhaps in the same form it is today, perhaps in a different form,” he said in Lima on Sunday.

Trump on Monday released a video updating the American people on his transition planning for the White House.

I think Trump is being short sighted, but no matter, there are other economies worth engaging with on trade. If the US wants to try and halt free trade and erect trade barriers they may find life gets difficult for them.

 

– Fairfax

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