US President-elect Donald Trump’s recent announcement to withdraw from the Trans Pacific Partnership (TPP) has sent shockwaves throughout the international community, including the Asia-Pacific and Europe. This transformation of rhetoric into action will have vibrating effects all over. With this new development, there are a number of dynamics to consider: Firstly, what it would mean for the US — the regional impact as well the domestic considerations.
Throughout the presidential election campaign, Trump made very strong statements regarding the pivot in reference to the TPP. During the campaign, he called it as one of the worst deals ever made. Now, as President-elect, he intends to make good on his promise: As part of one of his first orders of business, he has called for a withdrawal from it.
On further analysis, it seems to be more like a knee-jerk reaction to the campaign promise. Since the election, he has begun to change his tune on a number of issues — for instance, on climate change, immigration and ‘Obamacare’, to name a few. This was to be expected. Therefore, in considering withdrawal from TPP, there will be a number of facets to consider — especially the rippling effect the decision might have on the US and the region. The first major question is will Trump actually be able to withdraw from the TPP and will this signal a withdrawal from the region.
At first glance, the President-elect comes across as a traditional isolationist-Republican of the pre-cold war era. On further review he seems like every other politician i.e. ‘keeping all options on the table’. Donald Trump’s world view, that of pulling out of TPP, renegotiating NAFTA, getting Japan and South Korea to take greater initiative in managing their own defence as well as calling out NATO allies to pay their dues and so on — these do not seem like bad ideas in theory. However, the reality is different.
Sweeping statements like these made by the future Commander-in-Chief have a tendency to create a trust deficit and a reliability problem for the regional allies especially in the Asia-Pacific region. The pivot or the rebalance strategy of President Barack Obama had a four-fold aim — strengthen the Asian alliances, focus on an economic-driven foreign policy in the region, create a diversion from the Middle East conundrum and, in due process, contain China. The TPP would achieve all this.
If Trump does as he says and withdraws from the TPP, the fear among the allies is that the withdrawal might signal a withdrawal from the Asia-Pacific. It does not necessarily mean the same thing. The threat of withdrawal has perturbed many allies, including the Japanese and the South Koreans who have hinged the survival of the TPP on the US being part of it. This uncertainty is not unfounded, especially with statements during the campaign that South Korea and Japan should look after their own defence.
However the reality is that the Asia-Pacific is like a can of worms — once opened, it cannot be retracted from. Hillary Clinton as Secretary of State called it “America’s pacific century”. The regional environment would also not permit a US regional withdrawal. Therefore, if Trump, as President, were to withdraw, he would have to make the tough choice of losing hegemonic power in the region which would bring fears of US decline to the fore or worry about maintaining campaign promises.
In considering that the US withdrawal is a foregone conclusion, the Trump administration will have to strengthen regional bilateral alliances that would replace the TPP. However, the problem here is, negotiating. Though bilateral v multilateral negotiations are much easier, nevertheless it is a long drawn out process especially since Congress has to ratify them.
However, withdrawing from TPP is easier said than done. The TPP is a multilateral agreement — though it has not been ratified by Congress, it was agreed upon by 12 countries including the US. It has also taken about seven years in the making and several rounds of negotiations. Withdrawing from the agreement will not be as easy as Mr Trump thinks it will be.
Another aspect to consider is recalibrating the TPP. Though the other signatories of TPP equate US withdrawal with the end of TPP, it is not so. If the US withdraws, the TPP is not dead in the water. The 11 signatories could amend the rules, a revived TPP could be beneficial to all other signatories. For the US, it would mean that by proxy it would be still part of it.
The final regional component, it is a platform to strengthen alliances while simultaneously offering an option to regional trade that would counter China’s Regional Comprehensive Economic Partnership (RCEP). As China is not part of the TPP and already has strong economic ties with each of the signatories, this would be a lost opportunity for the US in the region. The Chinese-engineered RCEP is an attempt to counter the TPP which could either go forward to fill the proverbial vacuum or could be receded (which would could be a political faux pas). Therefore, in all likelihood, if the US withdraws from TPP the Chinese will push the RCEP to fill the vacuum. The RCEP includes 16 regional countries and not the US.
Domestically, the TPP was on the bitter end of the stick during the presidential election, which was especially on display during the Democrat Convention in July with placards reading No TPP etc. In spite of this, there are many — Democrats and Republicans alike — who support it.
At one point, there was debate in Congress over a lame-duck vote on the TPP which could have possibly created a problem for the incoming administration as both Hillary Clinton and Trump were against it. However that seems impossible given the current situation and as the Republicans control both Houses, in Congress the possibility of a lame-duck vote is dead in the water.
Another reason for not bringing the lame-duck vote is Congress will have to repair some of the damage created by the election. The Republicans have to try and mend fences created during the election campaign between the party and the President-elect if they have any hope of working together for the next four years depending on the 2018 midterm election outcome.
In all probability, it will take time before the US withdrawal of TPP is actually put into action. In the meantime, the administration will have to get cracking on reassuring the allies as well as working on additional deals. It is also to be seen whether Trump’s words will actually be converted to mere rhetoric.
*Kimberley Anne Nazareth is a Researcher at the Institute of Peace and Conflict Studies (IPCS), New Delhi.