The first step has been taken as far as closing out the Trans-Pacific Partnership (TPP) trade deal is concerned: Negotiators have reached a deal after five years and a solid week of round-the-clock talks. The problem is that many of the provisions that make up the deal are not going to be very popular with the national legislators who will now have to ratify it.
The majority of the opposition in the United States has come from the Democrats, who do not appear to be in the mood to switch sides after candidates Hillary Clinton and Sen. Bernard Sanders have both expressed their displeasure. Republicans had been backing the trade deal; but in an election year, they may be hesitant to make Obama look good. There are many in the Tea Party wing of the GOP who oppose the TPP as well.
The U.S. is not the only nation that is going to struggle to pass this. Canada is not happy about opening its market to dairy imports; and Japan still wants more access to the U.S. for its manufacturers. The fight is now highly political and even the most optimistic of observers give this a somewhat remote chance of passage. This is simply not a good time for trade pacts.
The TPP represents a greater interest in emerging nations located in the southeast part of Asia (Vietnam, Singapore and Malaysia) on the part of the North American economic powers as well as others like Japan, Peru and Australia.
- Chris Kuehl, Ph.D., NACM economist and co-founder of Armada Corporate Intelligence