There was plenty of rhetoric that covered the Trans-Pacific Partnership (TPP) during the 2016 presidential campaign. Most of the stories went around if Asia-Pacific trade agreement was something of a nice deal for the US. Obama stood firm in support of the deal but then, he received much opposition from other popular people. Donald Trump was one of them who opposed this trade pact. By then, the State Secretary Hillary Clinton has seen a proponent of this trade agreement but she came out to oppose it during the 2016 campaigns. But then, what is this called the TPP? What makes this thing become so controversial? Read on to know all this.
What is the Trans-Pacific Partnership?
It was early along started as the Trans-Pacific Strategic Partnership trade pact back in 2005. This was a trade agreement between Singapore, New Zealand and Chile. After sometime later, other nations, eight in number made to make negotiations to expand the trade pact. These countries were Canada, Mexico, United States, Australia, Japan, Peru, Malaysia and Vietnam. A lot of time passed before coming up with an agreement on this, over a decade went down for the nations to sign it. But then, New Zealand and Japan ratified the deal just before we saw US participation withdrawn by President Trump.
This trade pact was not only made to improve the economic relationships among these nations but also to significantly reduce tariffs and remove trade barriers. The trade agreement boasted some impressive numbers; The member nations accounted for almost half the economic clout of the world, total population tallied over 800 million and also the reduction in taxes charged on imports was set and they included some 18000 plus tariffs. So many international institutions reported that this trade deal will prove a benefit for nations. But again, many people thought that they were after trying to rebuke the expanding economic influence of China.
Why Did the United States Withdraw?
This trade pact as negotiated placed an increase in the US exports in different sectors. The whole benefit was set to go past $ 120 billion come 2015. There is a lot that the US would have benefited from the deal but then, the drawbacks were also not a thing to laugh with. Like for instance with income gains, that increment would have in those making more than $ 87,000 should it be signed. Another problem arose was the language about the copyright and patent protection more specifically when limiting cheap generic alternatives and medical drugs when they enter the market. Then lastly, the manner in which negotiations were carried out wasn’t such transparent and open. These are some of the things that actually made the US withdraw from this agreement.
How TPP Compare with NAFTA?
The leading North American Free Trade (NAFTA) deal members are the United States, Mexico and Canada. The goal of this trade agreement since its inception was to bring about free trade between these countries on investments, customs, protection of intellectual property, procurement and much more. To compare these two trade deals, they don’t seem to be too different. There exist many similarities if you try looking at them. The similarity didn’t only stop at giving US more stake in both Asia and the Pacific, other similarities between these trade agreements include, aiming at promoting free trade between these countries, the inclusion of provisions that would govern the trade deal and they all favour spread of footprint corporations.
An important factor that will better show the similarity in these two trade deals is the opposition they received from the US president Donald Trump. He made it till the TPP trade deal ended on arrival and also he is the one who immediately resulted in the reworking of NAFTA trade agreement that had been there for over two decades.
The trade deal between the US, Mexico and Canada led to the solidification of the world’s leading economic power. TPP was to be formed mainly to counter China’s expanding economy and broaden the influence of the US across the Pacific and Asia. Who knows how the TPP would have shaped US economy? actually no one, right?. NAFTA remains the long term trade impact as it gives way to USMCA. Get to know all about these trade agreements today. https://www.iqsdirectory.com/resources/a-no-go-for-the-us-what-is-the-trans-pacific-partnership-and-why-did-it-fail/