Japan vows to revive TPP after Trump pullout

Following Donald Trump’s statement that he will pull out of the Pacific Rim free trade pact, Japanese cabinet members have said they will amend the legal framework and continute the partnership without US involvement.

Tokyo skyline. Trump vows to pull out of TPP
President-elect Donald Trump has vowed to pull the US out of the Pacific Rim free trade pact, the Trans-Pacific Partnership (TPP), "on day one" of his arrival in the White House in January.Instead, Mr Trump said in a video message that his administration would concentrate on reaching bilateral trade deals that would protect American interests and jobs. "I'm going to issue a notification of intent to withdraw from the Trans-Pacific Partnership, a potential disaster for our country. Instead, we will negotiate fair bilateral trade deals that bring jobs and industry back onto American shores," said Mr Trump. CNBC commented, "The trade pact was a centrepiece of the Obama administration's 'pivot' towards Asia and was meant to solidify the US's presence in what is considered by many American companies as the most economically dynamic part in the world."Yoshihide Suga, Japan's chief cabinet secretary, told a press conference in Tokyo on Tuesday that the country now planned to lobby the other signatories to the 12-nation pact about pressing ahead with TPP without the US, though its legal framework would have to be amended.

Related articles:


This is because one of the provisions of the treaty states it either needs to be approved by legislatures in all 12 signatory nations – obviously, now impossible without America – or by at least six of them if, together, they account for 85 per cent of the combined GDP of the entire group. As the US accounts for 60 per cent of the total GDP, there can be no way of meeting the 85 per cent threshold without the US. Throughout the election campaign, Mr Trump was a vociferous opponent of the TPP. President Obama was an enthusiastic supporter of the deal – though less so Hillary Clinton – regarding it as beneficial for workers in all the nations involved because of new standards for wages, hours, working conditions and prohibitions against child labour. "Officials also said US companies, particularly small businesses, would be able to vastly expand their exports through the elimination of tariffs, and that the deal would bring stronger standards for transparency, anti-corruption, and environmental protection," said Voice of America. However, Congress has not given the necessary endorsement for the US to formally join TPP and now, it seems, it will never get the chance. Australian Prime Minister Malcolm Turnbull said, "Time will tell whether and to what extent the new administration and the new congress engages with the TPP or an evolved version of that agreement. There is very strong support among the other 11 parties to the TPP to ratify it and to seek to bring it into force."New Zealand Prime Minister John Key said, "The United States is not an island. It can't just sit there and say it's not going to trade with the rest of the world, and at some point it will have to give some consideration to that." The 12 countries currently involved in the TPP are: the US, Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile and Peru.

For related news and features, visit our Enterprise section.

Access hundreds of global services and suppliers in our Online Directory

 

now to our Global Mobility Toolkit