Sunday, November 13, 2016

Donald Trump kills TPP, Barack Obama Asia pivot 'unstuck'


Donald Trump kills TPP, Barack Obama Asia 

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Donald Trump kills TPP, Barack Obama Asia pivot 'unstuck'



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Image result for Donald Trump kills TPP, Barack Obama Asia pivot 'unstuck'
Image result for Donald Trump kills TPP, Barack Obama Asia pivot 'unstuck'

Trump's stunning election has forced  the Obama administration to shelve the Trans-Pacific Partnership trade deal, crippling the United States pivot to Asia and handing China a big strategic opportunity to fill the void.
Australian businesses counting on the trade and investment pact to prise open new markets in 11 other Pacific Rim countries will lose out on the failure of the TPP, which Prime Minister Malcolm Turnbull once hailed as a "gigantic foundation stone" for the economy.
Australia will instead pursue other regional free trade deals, chiefly ASEAN's planned Regional Comprehensive Economic Partnership (RCEP) that US rival China is aggressively pushing as an alternative to the US-backed TPP which Beijing was omitted from.
White House officials and US Congress leaders on Friday confirmed they had suspended trying to legislate the TPP before the next president takes office, blaming the anti-trade sentiment that helped propel Mr Trump to victory in vital industrial "rust belt" states.
The geopolitical consequences of the US being seen to walk away from allies in Asia could be at least as severe as the economic ramifications and potentially reshape the balance of power in the region in favour of a rising China.


Asia Society Policy Institute director of Asian security, Lindsey Ford, said the development raised "significant questions about which – if any – elements of Obama's much touted pivot to Asia will survive under a Trump presidency."
"Donald Trump's election now leaves many Asians concerned that their fears of eventual U.S. abandonment were well-founded," she said.
Instead of reducing trade barriers in the region, Mr Trump threatened during the campaign to start a trade war with China, impose tariffs of up to 45 per cent on Chinese imports into the US and label Beijing a "currency manipulator".
Mr Turnbull and Foreign Affairs Minister Julie Bishop have repeatedly stressed the importance of the TPP and broader Obama Asia rebalance to Australia's security and economic interests.
On a phone call to Mr Trump last week, Mr Turnbull failed to persuade the Republican president-elect to reverse his strong opposition to the TPP.
On Sunday, Trade and Investment Minister Steve Ciobo said Australia didn't have "all our eggs in the one basket" and would pursue RCEP, the Trade in Services Agreement and deals with the United Kingdom and European Union.
The TPP was the vital unfinished economic plank of the Obama administration's security, diplomatic and economic pivot – later named "rebalance" – to the Asia Pacific.
The policy was intended to embed the US-rules based order in the region, partly to counterweight China's growing clout.
Beijing will lead a push for a rival Asia-Pacific free trade zone at the APEC Economic Leaders' Meeting this coming weekend in Peru.
President Obama staked his Asia strategy on completing the TPP and warned earlier this year if the deal fails China could "write the rules".
Former Asia security adviser to president George W. Bush and now Center for Strategic and International Studies vice president for Asia, Mike Green, said the US would "suffer a hit in terms of credibility and reputation without TPP."
Beyond the failure of the TPP, the US rebalance is showing signs of fraying.
Philippines president Rodrigo Duterte is tilting away from the US towards China.
Malaysia's Prime Minister Najib Razak recently visited China to cut economic and defence deals.
"The rebalance is starting to become unstuck," said James Clad, a dual US-New Zealand national and former US deputy assistant secretary of defence for Asia Pacific security affairs.
The TPP was intended to set sweeping new rules for trade, investment, intellectual property, labour, data storage, state-owned enterprises and the environment across Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US and Vietnam.
President Obama was known as the Pacific President, after being born in Hawaii and going to school for four years in Indonesia.
His push into Asia does have some notable achievements, including a US-South Korea free trade deal, renewed US engagement with South East Asia including Vietnam, improved relations with Indonesia and US defence agreements with Japan, South Korea, Singapore and Australia.
As part of the deal, up to 2500 US marines will rotate through Darwin.
President-elect Trump channelled a deeply nationalistic "America First" rhetoric during the campaign and signalled he may withdraw US military assets from Japan and South Korea.
Brookings Institution US-China expert, David Dollar, a former US Treasury economic and financial emissary to China, said: "There is a widespread view in the Asia-Pacific that the United States is withdrawing from the global economy and global responsibilities."
While Democratic presidential candidate Hillary Clinton withdrew her pre-election support for the TPP, trade advocates hoped if she won the election the Obama administration could push the trade deal through congress in the "lame duck" sitting session before the new president takes office on January 20 or that she might even change her mind.
Mrs Clinton, a former secretary of state, was in favour of advancing Mr Obama's other rebalance initiatives in Asia, having helped orchestrate the pivot between 2009 and 2013.
Officials had worked on the trade pact for seven years and agreed to an international deal last year.
Each country needed to ratify the deal through their legislatures. Without participation of the US, the largest economy, there is no prospect of the accord being implemented.