Trump’s Trade Accomplishments on Asia Trip: Nothing
President Donald Trump said he will make a “major” announcement on the outcome of trade negotiations during his trip to Asia when he returns to the White House later today.
The president has teased the next episode of his reality TV show before, usually without delivering results. To quote the president on other occasions, “We’ll see what happens.”
“We’ve made some very big steps with respect to trade, far bigger than anything you know, in addition to about $300 billion in sales to various companies, including China,” Trump told reporters. “We have deficits with almost everybody. Those deficits are going to be cut very quickly and very substantially.”
If today’s announcement has to do with deals struck by US companies as part of a Department of Commerce trade delegation, it doesn’t count, for a few reasons. First of all, the deals were already announced by Commerce.
Secondly, most of those so-called deals involve non-binding memorandums of understanding or letters of intent. Those may or may not result in any dollars flowing the way of US companies.
Third, that doesn’t represent a change in policy of any US trading partners, especially China, to allow more market access to US exporters.
How do we know that? Because Secretary of State Rex Tillerson told us so.
“Quite frankly,” he told reporters in Beijing, “in the grand scheme of a $300 to $500-billion trade deficit, the things that have been achieved thus far are pretty small. In terms of really getting at some of the fundamental elements behind why this imbalance exists, there’s still a lot more work to do.”
So what did Trump accomplish during is Asia tour on trade? Nothing.
He did manage to accuse Japan of engaging in unfair trade practices when he was in that country, harping as he always does on the imbalance in trade between the two countries.
“Right now, our trade with Japan is not fair and it’s not open,” said Trump. “The US has suffered massive trade deficits with Japan for many, many years.”
On the other hand, Trump and his policies received a slap in the face, when the remaining eleven members of the Trans-Pacific Partnership used their presence at the APEC Summit in Vietnam—which Trump also attended—to make progress on continuing the deal without the United States.
Trump withdrew the US from the TPP on his third day in office.
Officials of the TPP11 said the plan was to sign a final agreement early next year. The deal would eliminate the tariffs on 95 percent of goods in a trading bloc covering 500 million people and more than $10 trillion in economic output.
For an administration that wants to put America First, this development may prove that the Trump trade policies will have America lagging behind.
“This will send out a very strong message to the US and to other Asia-Pacific countries,” Toshimitsu Motegi, the Japanese economy minister, told the press on hand.
Trump continued on the Asia trip to press for reducing trade deficits and entering into bilateral trade agreements. In talks with Vietnam, all Trump was able to produce was access to that market for for US distillers grains and an announcement of further discussions on the trade in shrimp and mangoes and for electronic payments.
Some critics charge that on the trade front the Trump appears to have been outmanoeuvred by Beijing and others. “I think everyone was polite to him and they want to make him think that they are all chummy and willing to do things with him,” one US business lobbyist told the Financial Times. “But I have to think in some ways they are laughing behind his back, and certainly the Chinese are.”
And the US’s former TPP partners appear reluctant to enter into the kind of bilateral relationships Trump favors, all the more so with progress having been made on TPP 11.
“The Trump team basically just wants to pound these guys into submission,” Alexander Capri, a senior fellow at National University of Singapore’s Business School, told CNN. “No trade partner of the U.S. wants to do a bilateral with them.”
Ironically, one of the original purposes of TPP was to contain Chinese influence in the Asia-Pacific region. Now that the US is isolated on the international trade stage, there may come a time when the US will have to knock on the TPP door once again.