China keen to jump in as US quits Trans-Pacific Partnership
Donald Trump has signed the executive order marking the USA's withdrawal from the Trans-Pacific Partnership (TPP) free trade agreement, while China, whose commercial might the treaty was aimed at contrasting, now intends to create its own free trade area.
The TPP was designed to bring together twelve Pacific Rim countries, excluding China, to counterbalance the latter's economic influence. But now that what the Obama administration pictured as a defensive tool against 'made in China' goods is crumbling, a formidable opportunity for the world's second-largest economy has arisen. While the other TPP signatories have not yet taken a stand on the partnership's future, China has stated it is ready to go full-speed ahead with creating an alternative free trade area.
The twelve TPP signatories by themselves accounted for 40% of all international trade. The USA were both the originator and the leading player in the TPP's activity, and estimated the value of their textile goods exports towards other TPP countries at $10 billion. One of the partnership's objectives was for the USA to become less dependent on Mexican labour, something which, ironically, is also one of Donald Trump's current priorities.
At any rate, the US President's decision seems to prelude to four years of troublesome relations between the US executive and the American apparel industry's business institutions. Since last October, the President of the American Apparel and Footwear Association (AAFA), Rick Helfenbein, has been highlighting the damages to trade caused by the future President's tirades.
"He has shown himself to be strongly anti-trade without any real or valid reason, if only because there are several empty industrial facilities to be seen throughout the USA," he said. "Donald Trump’s statement that those who negotiate trade deals on behalf of the USA are fools was offensive. It is a lie, they are truly brilliant individuals, and [Trump's statement] is not correct," added the AAFA President.
"We had a unique opportunity before us," lamented Matt Priest, President of the US association of footwear distributors and retailers. "We had a Republican Congress and a Democrat President who [both] wanted to pursue this. We were looking at half a billion dollars in savings in the [TPP's] first year of validity, and $6 billion in custom duty savings over the course of ten years. These are sizeable, impactful figures."
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