TPP partners consider options after US exit

Members of the Trans-Pacific Partnership (TPP) are considering other trade options following the withdrawal of the United States from the landmark deal, which was considered a strategic move against China.
The Straits Times reports that Singapore aims to continue to participate in other free trade initiatives and discuss the way forward with TPP partners.
“Each of the partners will have to carefully study the new balance of benefits,”the Ministry of Trade and Industry said in a statement.
President Donald Trump on Monday signed an executive order to withdraw the US from the 12-nation TPP that together accounts for 40 per cent of world trade. He also vowed to renegotiate a free trade agreement with Canada and Mexico.
Australia and New Zealand have said they still hope to salvage the TPP despite the US withdrawal. However, Singapore’s MTI said the deal cannot go into effect in its current form without US participation.
In Japan, Prime Minister Shinzo Abe’s administration will be forced to rethink its economic policies following the US exit.
Trump has singled out Japanese automakers for engaging in unfair practices on auto imports and exports but Tokyo was quick to point out that the US president’s assertions are groundless, according to The Japan News.
“In non-tariff aspects as well, Japan does not treat [US vehicles] with discrimination,” Economy, Trade and Industry Minister Hiroshige Seko said.
Japan has already abolished automobile tariffs so that when US vehicles are imported and sold in Japan no duties are imposed. On the other hand, the United States imposes import duties of 2.5 per cent on Japanese vehicles, The Japan News noted.
Tokyo said it will try to explain the issue to Washington hoping to change Trump’s mind before next year, the deadline for the deal’s ratification. In Abe’s recent tour of four Asia-Pacific countries, he also urged Vietnam and Australia to push on with the pact.
The Abe administration has used TPP as a main pillar of its growth strategy and has estimated its impact on domestic economy at Y14 trillion (about US$123 billion, Bt4.3 trillion). But with US’ withdrawal, Japan may have to consider looking at bilateral trade negotiations instead.
But The Japan News said that under bilateral negotiations, it |will be difficult to reach high-level agreements such as the massive cuts to and even the abolition of tariffs as agreed upon under the TPP framework.
In the meantime, Singapore said it will continue to participate in regional initiatives such as the Regional Comprehensive Economic Partnership (RCEP) and the proposal for a Free Trade Area of the Asia-Pacific.
RCEP is an Asia-Pacific trade liberalisation initiative led by China that includes the 10 Asean members as well as Australia, New Zealand, Japan, South Korea and India.
The Singapore Business Federation, meanwhile, has called on the government to join and encourage other TPP member countries to push for the implementation of the TPP, with or without the US.
Singapore already has a bilateral free trade pact with the US, as well as with all of the other TPP countries except Canada and Mexico.
Other TPP partners have also expressed their keenness to make the deal work. Australia’s Trade Minister Steve Ciobo earlier told ABC Radio that a TPP without the US was “very much a live option”.