POST TIME: 9 March, 2018 00:00 00 AM
Asia-Pacific trade deal
Life goes on without Trump

Life goes on without Trump

PARIS: A slimmed-down trade pact to be signed yesterday will allow eleven Asia-Pacific nations to push forward with economic integration in the face of greater US protectionism, even if the new deal will offer less benefits than originally hoped. Originally called the Trans-Pacific Partnership, it was left for dead after newly-elected US President Donald Trump pulled out to pursue his “America First” agenda before the pact could take effect.

“The world will not stop simply because of US disengagement,” wrote Yoichi Funabashi, chairman of the Asia Pacific Initiative think tank said in a recent commentary published in the Washington Post. But Japan sought to revive the deal, picking up support from Canada, Australia and Chile, host to the signing of the rebaptised Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

The signing of the deal comes just as the Trump Administration plans to slap tariffs on imports of aluminium and steel entering the United States.

It was the United States which initially pushed for the pact, signed in February 2016 when Barack Obama was still in the White House. The TPP would have covered 40 percent of the global economy and nearly one-quarter of its trade.

Without the United States, the new pact is worth less than half of that value -- 15 to 18 percent of global gross domestic product (GDP). The 11 nations signing the CPTPP are also only expecting half of the boost they were under the TPP. “One point of GDP instead of two initially expected,” said Julien Marcilly, chief economist at the credit insurance firm Coface.

“The impact is certainly less than expected, but the agreement deserves to exist and enter into force relatively quickly,” he added.