President Donald Trump signed an executive order formally withdrawing the United States from the 12-nation Trans-Pacific Partnership trade deal yesterday (23 January) as Europe sniffed a chance to pick up the free trade the US is turning its back on.
At a ceremony in the Oval Office, Trump officially began the process of dismantling the agreement, which had been put together by his predecessor, Barack Obama, and the new president called the TPP order a “great thing for the American worker”.
The decision has already drawn domestic criticism, as Senator John McCain, a former Republican presidential candidate, said it was a “serious mistake” and would “have lasting consequences for America’s economy and our strategic position in the Asia-Pacific region”.
TPP has been signed by 12 countries, including Australia, Canada, Japan and Singapore.
A spokesman for Canadian Foreign Affairs Minister Chrystia Freeland, who infamously left Brussels on the verge of tears when it looked as if the EU-Canada deal (CETA) was dead in the water, would only comment that “the agreement cannot enter into force without the United States”.
Canada will therefore be hoping that CETA is able to negotiate another hurdle today as the European Parliament’s Trade Committee decides whether the deal should go before a full vote in Strasbourg next month.
“We have an important friend and ally who seems to be at least partly disengaging from the international scene promoting less trade, more protectionism,” EU Trade Commissioner Cecilia Malmström told MEPs, in a direct reference to the US.
“We need to stick together with like-minded partners to show that these trade deals are actually functioning, and what better partner can we have than Canada,” she added.
Malmström’s efforts may shift completely onto securing CETA, as her other major project, the Transatlantic Trade and Investment Partnership (TTIP), with the US appears to have little to no chance of progressing, if Trump’s TPP decision is a true indicator of his administration’s trade policy.
Nothing is certain at the moment, as Trump has pledged to put “America First” as well as assuring leaders like UK Prime Minister Theresa May that work on a bilateral trade deal will start as soon as possible. Barack Obama previously warned the UK that they would be “at the back of the queue” as a result of Brexit.
TPP’s other economic powerhouse, Japan, remained hopeful, however, that the deal could be saved and an adviser to Prime Minister Shinzo Abe said that “we do have a window until 2018, when the treaty needs to be ratified. We believe we still have an opportunity to convince the US about the importance of free trade.”
French President François Hollande was in Colombia at the start of this week to sign a number of agreements on tourism, education and security, and the outgoing head of state insisted that he would seek to bolster trade and investment with the Pacific Alliance trade bloc in joint negotiations with the European Union.
Hollande made indirect mention of Trump, saying that while some countries are seeking changes to trade agreements, Europe and France want to expand their ties. He branded protectionism “the worst response” to global challenges.