The White House declared “a new era of U.S. trade policy in which the Trump administration will pursue bilateral trade opportunities with allies” following its withdrawal from the 12-nation Trans-Pacific Partnership trade pact. Farm groups, whose members voted by a landslide for President Donald Trump, called for protection against loss of farm exports due to the change in focus.
Exports generate 20 cents of each $1 in farm income, with sales forecast for $134 billion this fiscal year. “We need the administration’s commitment to ensuring we do not lose the ground gained — whether in the Asia-Pacific, North America, Europe or other parts of the world,” said president Zippy Duvall of the largest U.S. farm group, the American Farm Bureau Federation.
President Donald Trump signed a memorandum to withdraw from TPP following a breakfast with business leaders. “We’ve been talking about this for a long time,” he said, before signing and then displaying the memo for photographers. “Great thing for American workers that we just did.” Trump vowed repeatedly during the campaign to withdraw from TPP and renegotiate NAFTA.
“This executive action ushers in a new era of U.S. trade policy in which the Trump administration will pursue bilateral trade opportunities with allies around the globe,” said White House press secretary Sean Spicer. “The beautiful thing about a bilateral agreement is [countries] can renegotiate much easier” than in a multilateral trade bloc.
Trump already has spoken to the leaders of Mexico and Canada about his intention to renegotiate NAFTA although the United States has not acted formally. “And I think when he meets with both of these individuals over the next 30 days or so, that’s going to be a topic,” said Spicer. British Prime Minister Theresa May is to meet Trump on Friday with a bilateral trade agreement as a potential topic, he said.
Asked when Trump would seek trade agreements with TPP members, Spicer said, “The president’s going to look to countries to engage with” and added “most of them we have existing trade agreements with.”
For U.S. agriculture, the big prize in TPP, which covered 40 percent of the world’s economy, was to be greater access to Japan. The Farm Bureau’s Duvall said TPP “would have added $4.4 billion a year to our struggling agriculture economy” so “it is critical” for the administration to find new outlets for farm goods.
Half of U.S. soybeans are exported, and the American Soybean Association said Southeast Asia was a growing market. In addition, it said TPP would have removed barriers to exports of GE crops, which are the bulk of U.S. corn, soybeans and cotton output. The National Association of Wheat Growers said U.S. farmers “will be forced to the sidelines of trade while losing market share in the (TPP) region” to Australia, the European Union, Russia and Canada. Half of U.S. wheat is exported.
But the National Farmers Union, the second-largest U.S. farm group and a longtime foe of TPP, welcomed Trump’s action. “NFU looks forward to working with the new administration and Congress to promote fair trade solutions that work for family farmers and ranchers and the U.S. economy,” said NFU president Roger Johnson.
The halting progress of the Doha Round of WTO talks has inspired arguments that the drive for multilateral liberalization of trade is near the end of its useful life, making regional or bilateral pacts a wiser investment of time and energy. Global trade talks created the World Trade Organization 20 years ago with its framework of trade rules and a system to resolve disputes over compliance. In recent years, advances have been difficult to achieve. Rising economic powers, such as Brazil, Russia, India and China, have rejected calls by industrialized nations to remove market barriers while pressing for concessions from the developed world.