It can be hard to track exactly what is going on with trade negotiations, and when the news reports are actually a big deal. Each round of negotiations generates headlines, but often leads to nothing except for another round of negotiations. But yesterday the 11 governments negotiating the Trans-Pacific Partnership released a revised version of the text of the agreement, which is kind of a big deal, because you never know for sure how much progress governments are making until they show you the final document. Releasing the text indicates that this agreement is definitely going forward, with signing and ratification coming soon. And of most relevance for Americans, it is going forward without the United States, as President Trump withdrew from the agreement soon after he took office.
What's in this deal? New Zealand has provided a good summary of what it thinks it is getting from the agreement in terms of lower tariffs and other items (and which U.S. businesses won't be benefitting from). Here are just a few examples:
- Japan will reduce its 38.5% tariff on beef to 9% over 16 years.
- Japan's tariffs on offal and processed meats will be eliminated over 11–13 years with a 50% reduction at entry into force.
- Tariffs on most cheese types will be eliminated in Japan over 16 years.
- Malaysia will eliminate liquid milk tariffs over 16 years.
- All tariffs on apples would be eliminated within 11 years.
That's all very good news for the countries who are part of the agreement. But as the United States is no longer part of the agreement, there are no direct benefits to Americans. It's also worth noting that the revisions to the TPP which occurred after the United States withdrew, and which provided the basis for the other countries to go ahead, were suspensions of provisions that the United States had wanted in there.
Of course, the United States could negotiate its own trade agreements with these same countries. But that hasn't happened. Back in November, I asked: "We are now nine months into the Trump administration, and it’s reasonable to ask: where are all the new trade deals that were promised?" Now we are more than a year into the Trump administration, and the falling behind on trade just keeps falling further.