Donald Trump’s irrational decision to withdraw the United States from the Trans-Pacific Partnership
The Trans-Pacific Partnership (TPP) is a previously proposed trade agreement between 12 countries that was intended to strengthen economic relations between these countries by eliminating tariffs and promoting free trade. The twelve countries that participated in the signing of the TPP proposal on February 4, 2016 were Canada, Japan, Australia, Mexico, Vietnam, Singapore, Brunei, Malaysia, New Zealand, Chile, the United States and Peru. Donald Trump’s executive order to remove the United States from the TPP on January 23, 2107, was a serious mistake. Trump withdrew the US from the TPP with the intention of improving US job growth and restoring the deteriorating manufacturing industry. He believes that the TPP is detrimental to American employees and the manufacturing industry because huge amounts of American jobs would be exported to low-wage countries. Many US companies outsource jobs to other countries to capitalize on cheaper labor and operating costs. Even though Trump’s decision promotes job growth in the US, it will be more damaging in the long run because it will be difficult for the US to maintain its influence and leadership in international economic and political affairs. In addition, China would be in a position to take advantage of the United States’ exit from the TPP and become a dominant country in the world economy. Therefore, Trump’s decision will do more harm than good to the US economy.
By renouncing the TPP, the United States misses a great opportunity to expand its markets, eliminate tariffs, and promote exports. The TPP would have been the largest free trade agreement in history because the countries involved control an annual gross domestic product (GDP) of roughly $ 28 trillion, which accounts for roughly 40 percent of world GDP and a third of world trade. The implementation of the TPP would have vastly improved international trade relations between the original countries involved, which would have been far more beneficial to the US than Trump’s plan to increase job security in the country. Fortunately for the US, there have been no immediate sanctions on international trade flows for its decision to withdraw from the TPP because they still maintain existing free trade agreements with six of the TPP countries (Mexico, Chile, Singapore, Australia , Canada and Peru). . However, Trump’s decision will put the United States at risk of economic and political disaster in the near future.
As a result of Trump’s decision, China was given a great opportunity to surpass the United States and become the dominant country in the global trading economy. Chinese President Xi Jinping plans to take advantage of Trump’s foolish decision to improve China’s relations with several of the other countries involved in the TPP. China intends to negotiate a new free trade agreement with several of the original countries involved in the TPP and other neighboring Asian countries. The new proposed free trade agreement is called the Regional Comprehensive Economic Partnership (RCEP) and would include 16 countries in Asia and the Pacific. Like the TPP, the RCEP aims to promote free trade by eliminating tariffs and strengthening economic relations between the countries involved. If RCEP is successfully implemented, China will be in such a strong position to create the guidelines for
Many countries in Asia and the Pacific invested an enormous amount of political capital in a US-led trade agreement that was not administered. Therefore, since the United States was unable to commit to the TPP, its reputation and credibility are considerably undermined. This will be a disaster for the US economy because they will lose most of their influence in the Asia-Pacific region. Many countries in Asia and Latin America already see China as the superior and most reliable country in the global trading economy than the US These countries prefer to negotiate trade agreements with China because they find it difficult to trust the US dominant country. in the world trade economy, not China. Trump is leading the US toward failure because he should have realized before his decisions would have devastating consequences for the US economy. The United States should have seized its opportunity to claim an authoritative position and create the guidelines for the global economy, rather than handing it over to China. In the future, it will be difficult for the United States to negotiate favorable trade conditions and access the Asian supply chain because strong economic relations will be established between China and most of the Asia-Pacific countries.
