President Donald Trump issued an executive order withdrawing US from the Trans-Pacific Partnership (TPP). The TPP withdrawal also indicates that everything is up for a renegotiation under the new administration. This, many believe, will impact US’ position as the leader in international politics.
According to Eswar Prasad, Trump’s order gives China a chance increase its influence as an Asian powerhouse. Prasad is a Professor at Cornell University and a former China expert at the International Monetary Fund. He believes that the order also dents US credibility on the world stage, states a Financial Times report. “In one fell swoop, Trump has undercut US credibility in multilateral negotiations,”said Prasad. “(It) handed China a golden opportunity to increase its economic and geopolitical influence in Asia and beyond,” he added.
Cancelling TPP hurts US
“This abrupt action so early in the Trump administration puts the world on notice that all of America’s traditional economic and political alliances are now open to reassessment and renegotiation. This could have an adverse long-run impact on the ability of the U.S. to maintain its influence and leadership in world economic and political affairs,” he added. According to a report in the Washington Post, US also risks slowing down its economy and growth by withdrawing from TPP.
Richard Haas, President of the Council on Foreign Relations believes that the action would also impact American jobs negatively. Like Prasad, he too feels that the TPP withdrawal will weaken US’ standing in the world. TPP was the main component of President Barack Obama’s Asia strategy. He believed that TPP would give US an opportunity to increase its influence in Asia. It would also keep a check on China’s economic and military aspirations.
However, Trump has been against the partnership. He said that TPP “wasn’t the right way” and dubbed it as ‘another disaster done.’ Hence, he was vocal about pulling the plug on TPP during his Presidential campaign. And as promised, he withdrew from it in his first few days as the President of US.
One-on-one trade deals instead of TPP
An article in The Australian states that instead of the TPP, the Trump administration wants to forge individual trade deals with different countries. An article in ABC News adds that President Trump wants to encourage American manufacturing. This is where the one-on-one trade deals come into the picture. According to insiders, Trump administration is looking at deals, which it can terminate in matter of a30 days if “somebody misbehaves.”
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