WASHINGTON: President Donald Trump may have realised his ‘America First’ policy risks leaving the US alone on trade, but analysts are sceptical his latest offer to rejoin a multilateral trade pact will bear fruit.
Trump went to the free-trade bastion World Economic Forum in Davos, Switzerland and offered the possibility that the US would rejoin the Trans-Pacific Partnership (TPP).
It came a year after one of his first official acts as the president was to withdraw from the deal, and only days after the 11 remaining TPP countries agreed to proceed with the accord in the absence of the United States.
The US president said the US would consider negotiating with its onetime TPP partners “either individually, or perhaps as a group, but only if it is in the interests of all.”
The TPP was initially a US-led project that, while deliberately excluding Washington’s rival China, would have accounted for 40% of global GDP.
Trump dumped the deal in the belief it would punish US workers by allowing companies to hire cheaper labour abroad.
His first year in office has been marked by a huge increase in trade complaints against various countries, especially China.
Gregory Daco of Oxford Economics said just before going to Davos he took a much more protectionist stance, imposing import tariffs on washing machines from South Korea and solar panels from China, and there are a host of decisions looming on steel and aluminum from China.
The business community certainly has ramped up its efforts to convince the administration to preserve the North American Free Trade Agreement (NAFTA), which Trump also threatened to tear up.
“I think there is a realisation that you can’t just be America First, and America alone, you have to be America with others,” Daco said.
He said that Trump, now returned to Washington, will have other major issues looming including reaching a budget agreement to prevent another government shutdown, raising the federal debt limit, and the investigation into possible election campaign collusion with Russia.
“At home you tend to forget what you said,” Daco noted.
Published in The Express Tribune, January 28th, 2018.
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