Northwest Arkansas Democrat-Gazette
Asia welcomes Trump trade offer
But a broad renegotiation of pact unlikely, members say
TOKYO — Japan, Australia and New Zealand reacted cautiously Friday after President Donald Trump signaled he might reopen talks on a Pacific Rim trade deal that he pulled the United States out of shortly after taking office.
Japanese officials said they welcome the move if it means that Trump is recognizing the importance of the Trans-Pacific Partnership. New Zealand’s trade minister said his country is not blind to the benefits of free trade with the world’s largest economy, but U.S. participation remains theoretical.
“It’s not yet clear how real it is, given the different views in the U.S. administration,” Trade Minister David Parker said.
His Australian counterpart, Steve Ciobo, said the United States is welcome to rejoin the agreement, but added: “Let’s also be clear, I think there’s very little appetite among the TPP [Trans-Pacific Partnership] 11 countries for there to be any meaningful renegotiation or indeed any substantial renegotiation of the TPP 11 at all.”
“What we’re all focused on is making sure we can bring the TPP 11 into effect as soon as possible,” he said.
He said that Australian agricultural exporters in particular are at an advantage compared with their American colleagues, “and I think that’s one of the reasons why the United States is having a second look at possibly rejoining the TPP.”
The three countries are among the 11 that signed the agreement last month after deciding to go ahead without the United States. The others include Brunei, Malaysia, Vietnam, Singapore, Canada, Chile, Mexico and Peru.
As trade tensions with China simmered, Trump asked his top trade advisers Thursday to take another look at the Pacific partnership and whether a better deal could be negotiated. He has previously criticized multination pacts, preferring to negotiate one-on-one with other countries. With congressional elections later this year, he now faces pressure from some Republican lawmakers anxious that his protection-
ist policies could spiral into a trade war with China that would hit rural America.
On Friday, customs data show that China’s global trade balance swung to a rare deficit in March as exports shrank but its surplus with the United States, the center of a worsening dispute with Washington, stood at $15.4 billion.
Exports contracted 2.7 percent from a year earlier to $174.1 billion, down from the 24.4 percent growth for the first two months of 2018. Imports rose 14.4 percent to $179.1 billion, though that was down from 21.7 percent growth in January and February. The trade surplus with the United States contracted 13 percent from a year earlier, while China’s global trade balance swung to a $5 billion deficit.
China runs multibilliondollar monthly surpluses with Europe and the United
States, which helps to offset deficits with Japan, South Korea and developing countries that supply industrial components and raw materials. The global trade balance often slips into deficit for one month early each year as factories restock after the Lunar New Year holiday.
Trump tweeted Thursday that he “would only join TPP if the deal were substantially better” than the one negotiated by his predecessor, Barack Obama.
Japan’s trade minister, Toshimitsu Motegi, warned that it would be difficult to renegotiate, saying the pact is a well-balanced agreement based on the varying interests of the signatory nations.
“It is an agreement so delicate, like something made of glass,” he said. “So, it will be difficult to take only parts of it and reopen negotiation, or change only parts of it.”
New Zealand Prime Minister Jacinda Ardern said the 11 nations “fought hard to get the
final agreement that we have now before us.”
“We’ve heard some of this discussion and debate about whether the U.S. might join before. If they were to choose to do that, that would trigger a process kicking off again. As it stands, the deal today would continue as is going forward,” she said.
The 11-nation trade deal, which was renamed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership after the United States withdrew, was signed in March but won’t come into force until it’s ratified by individual nations.
Parker said other countries have also expressed an interest in joining, including Colombia, South Korea and Britain.
New Zealand’s liberal government, voted into power last year, has been more cautious about the deal than the previous conservative government. One change the new government made was to introduce new laws that will restrict the
sales of New Zealand houses to foreign buyers, a provision Parker said would not change were the United States to join the pact.
The barriers to a new pact are considerable. Many current members of the pact feel they already gave considerable ground to the United States to strike the original deal, particularly in sensitive areas like protections for pharmaceutical companies.
For its part, the Trump administration worries that the partnership will become a zero-tariff backdoor for Chinese goods into the U.S. market. It worries that companies that have moved much of their supply chains to China could make components there, ship them to a member of the Trans-Pacific Partnership for assembly, then sell them in the United States tariff-free.