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TradeInFocus   Our compilation of news to keep you in focus on key trade matters

TPP Signatories Consider Next Steps Following US Withdrawal
Bridges - 11 February 2017
Various meetings between ministers from the Trans-Pacific Partnership (TPP) countries are on the docket in the coming weeks, as the remaining signatories of the Pacific Rim accord weigh their next steps after the US' withdrawal from the pact. US President Donald Trump issued a presidential memorandum last month confirming that the United States would no longer be a TPP signatory and would prioritize bilateral trade deals under his administration.

Maria Pagan, the Acting US Trade Representative (USTR), subsequently circulated a letter to New Zealand as the TPP depositary on 30 January confirming that
"the United States does not intend to become a party" to the deal. While the US move was expected, in light of Trump's repeated campaign trail promises on the subject, the confirmation that Washington would indeed be withdrawing after having played such an active role in the TPP's development has raised questions over what might be salvaged from the multi-country effort. The TPP negotiations were concluded in late 2015, with the deal signed by the 12 participating countries in February of the following year.

In the wake of the US' withdrawal, officials from the remaining TPP signatories have issued differing assessments over whether the trade accord can move forward in some form without the US. Australia, for example, has been among those calling for the group to consider a so-called "TPP 12 minus one" in light of the US decision. "What it comes down to is this, there were a lot of hard fought gains that were achieved through intense negotiations over many years, in relation to the TPP.

I don't want, and I know a number of other countries don't want to let those gains slip through our fingers," said Australian Trade Minister Steven Ciobo in an interview on 8 February with Bloomberg Daybreak, according to a transcript provided by his office. Ciobo added that he would be pursuing a "minimalist approach" aiming to keep in place the advances negotiated under the TPP and "apply it to as many member states as possible that are willing to sign up to those terms, less the United States."

He suggested, however, that if participants want to do more than just change the existing rules over the minimum threshold of original signatories that must ratify the deal, then the process would become more complicated. Even so, he mentioned he has already held some initial discussions with fellow TPP ministers, with more talks forthcoming. "I'm not going to rattle off any particular countries indicating their support or otherwise, but if we were able to do something with Canada, Mexico, Peru, Chile, New Zealand, Singapore, and Japan for example, well that would be a great outcome," said Ciobo.

However, Canadian officials have been among those suggesting in recent weeks that moving forward without the US would be difficult, given the way the accord was designed. "This agreement was so constructed that it can only enter into force with the United States as a ratifying country," said Canadian Foreign Minister Chrystia Freeland last month in a briefing for reporters. Whether Japan would be willing to be part of a "TPP minus one" approach also remains unclear, though other domestic officials also suggested that the Asian economic giant first wishes to discuss the trade deal further with Trump.

New Zealand trade minister visiting TPP counterparts
Other officials have already made known their own early assessments on where the TPP could go from here. New Zealand Trade Minister Todd McClay met with Ciobo earlier this week to discuss the next steps for the trade deal, with McClay planning trips to Mexico, Japan, and Singapore as well. "Despite the United States" recent decision to pull out of the agreement, a number of other TPP signatories - including Australia - have expressed a strong commitment to continuing with TPP.

This meeting will be an important opportunity to understand Australia's ambitions in this area," said the New Zealand trade official, according to a press release issued by his office. He also said that it would be ?too early to say" whether the TPP could still be revived, but that Wellington is currently interested in exploring and attempting it. McClay confirmed that the meetings with Japanese and Singaporean counterparts this week would also allow for discussions on the deal's future.

Meanwhile, Mexican officials have reportedly suggested that they will be looking to codify the TPP's gains into bilateral deals with any TPP signatories with whom they do not already have an existing free trade accord. Discussions between Mexican Economy Secretary Ildefonso Guajardo Villareal and New Zealand Trade Minister Todd McClay later this month are expected to include the subject of a possible bilateral deal, along with the TPP's future.

Separately, Japanese Prime Minister Shinzo Abe is due to meet with Trump this week, with trade expected to be high on the agenda. While initial reports of their 10 February summit in Washington indicated that the Japanese leader might push for discussions of a bilateral trade pact with the US, some officials are now suggesting that this topic may no longer be on the docket. "Abe is going to talk about how we can widen the importance and value of the TPP to the Asia-Pacific region in the economic talks with the US. I don't think an FTA will be discussed," said Yautoshi Nishimua.

Chile meeting to "canvas options"
Along with the various bilateral meetings scheduled for February, coming up next month will be a summit hosted in Chile among ministers from various countries to discuss collectively the possible next steps for the TPP. The gathering will be held in the coastal city of Vina del Mar on 14-15 March, and Chile has reportedly invited all TPP signatories as well as China and South Korea, according to multiple news reports. The final list of attendees has yet to be confirmed publicly at this stage.

However, some officials have already suggested that bringing the group together could be a useful opportunity to "canvas options" for the possible road ahead, both in terms of how to harvest the deal's gains and whether adding on new members could be an option. "In many respects these are questions that are best answered after March," said Ciobo in response to questions as to whether China might formally be asked to join the TPP in light of the US' withdrawal. "The reason I say that is because in March we'll have the opportunity in Chile to meet and discuss, as the TPP countries, what we see as the path forward."


White House Directs Regulatory Freeze, Delays Effective Dates of Already Issued Rules International Trade Today - February 10, 2017
White House Chief of Staff Reince Priebus on Jan. 20 directed the heads of all executive branch departments and agencies to temporarily postpone until March 21 the effective dates of regulations published in the Federal Register that haven't taken effect. The Trump administration will review "questions of fact, law, and policy" the regulations raise, Priebus said in the memo. The directive also instructs agencies to consider proposing for notice and comment rules to delay the effective date even longer "where appropriate and as permitted by applicable law," with no further action needed for unsubstantial rulemakings and notification of the Office of Management and Budget for regulations that present substantial law or policy questions.

CBP updated its single-page fact sheet on supply chain due diligence for importers to help avoid involvement with goods made by forced labor. The only change from the previous version is the addition of a link to an online "responsible sourcing tool". CBP continues to work on new regulations to implement the forced labor provisions of the customs reauthorization law, which repealed "consumptive demand" considerations.

Trump Signs Executive Order to Withdraw US From TPP
International Trade Today - February 10, 2017
President Donald Trump signed an executive order to withdraw the US from the Trans-Pacific Partnership on Jan. 23. "We've been talking about this for a long time," Trump said after he signed the order. "Great thing for the American worker, what we just did." Congressional Democrats and unions, predictably, supported the action, while others expressed disappointment. The text of the executive order wasn't yet available.

Sen. Sherrod Brown, D-Ohio, lauded Trump's move in a statement. Brown described the withdrawal as necessary and a first step in overhauling trade policy to put US workers first, saying he stands ready to champion Ohio employees by working with the Trump administration to renegotiate NAFTA and create jobs. Trump is set to meet with Mexican President Enrique Pena Nieto and Canadian Prime Minister Justin Trudeau to jump-start NAFTA renegotiations on Jan. 31.

House Ways and Means Committee Ranking Member Richard Neal, D-Mass., and committee Trade Subcommittee Ranking Member Bill Pascrell, D-N.J., in statements (here) both emphasized that TPP withdrawal should be the first part of a holistic re-examination of the US trade approach. "Going forward, the US needs a new direction for trade -- one that creates jobs in America, reduces our trade deficit, raises wages and protects the environment, consumer safety, and public health," Pascrell said. Vocal TPP critic Rep. Rosa DeLauro, D-Conn., in a statement signaled an intent to demand a "comprehensive, new approach to trade policy" under the Trump administration, including renegotiating NAFTA to create solid middle-class jobs that can't be outsourced, and an overall trade policy that expands access to affordable medicine, safeguards food and protects the environment.

Ways and Means Committee Chairman Kevin Brady, R-Texas, in an emailed statement said that while TPP holds "considerable benefits" for the US economy, its several shortcomings resulted in its failure to move in Congress. But Brady added that the Trump administration should build upon the merits of TPP, identify areas for improvement, and "quickly act on a strategy that creates more economic opportunities for America in that region," adding that US companies and workers will "lose out" if the US abandons the Asia-Pacific region. In an email, Ways and Means Trade Subcommittee Chairman Dave Reichert, R-Wash., essentially echoed Brady's statement, saying that while the agreement contained wins for "businesses, farmers, and workers," its standards weren't up to the level that Americans "expect and deserve," adding that the US must still compete in the Asia-Pacific region. Senate Finance Committee Chairman Orrin Hatch, R-Utah, in an emailed statement said he shares Trump's commitment to negotiate the "strongest" trade agreements for Americans, and pledged to "carefully review" the executive order to evaluate its impact, adding that he looks forward to working with Congressional colleagues and the Trump administration to put forth strong trade policies to boost competitiveness and access to new markets.

The Footwear Distributors and Retailers of America expressed disappointment, but said in a statement the group is not surprised by Trump's action, saying TPP withdrawal will translate to US consumers paying $500 million more per year on footwear. Teamsters General President James Hoffa in a statement commended Trump on making "good on his campaign promise" and starting the course of fixing 30 years of "bad trade policies" that have discarded millions of good-paying jobs. "We take this development as a positive sign that President Trump will continue to fulfill his campaign promises in regards to trade policy reform and instruct the USTR to negotiate future agreements that protect American workers and industry," Hoffa said. AFL-CIO also supported the move.


Wall Street First, America Last
Congresswoman Nancy Pelosi - February 10, 2017
The unchecked recklessness of Wall Street created the worst economic catastrophe in America since the Great Depression. Many San Franciscans lost their jobs, their homes, and their savings. The President wants to take us right back to that crisis, signing an executive order this week undermining the protections of The Dodd-Frank Wall Street Reform and Consumer Protection Act. Instead of fighting for families abused by our economy, as he promised in the campaign, the President and his billionaire cabinet have abandoned Main Street in order to enable Wall Street, all on the back of hard-working Americans.
With Dodd-Frank, House Democrats enacted the strongest Wall Street consumer financial protections in history. Now more than ever, we will continue to protect Dodd-Frank against Republican attacks and fight for the jobs, wages and retirement security of hard-working families across America. California Will Not Turn Its Back
Yesterday, the 9th Circuit Court of Appeals unanimously refused to lift the nationwide halt on President Trump's executive order banning refugees and citizens from seven Muslim countries. The 9th Circuit's unanimous ruling is a victory for our Constitution and our fight against terrorism. National security experts have urgently warned us that the President's ban is not just immoral and unconstitutional, but downright dangerous.

Details: Representative Nancy Pelosi CA12NPima@mail.house.gov

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