United States President Donald Trump on Monday, 23 January, took the first step away from America’s involvement in global trade deals, as he signed an executive order withdrawing the country from the Trans-Pacific Partnership Agreement (TPP).
The withdrawal is a “great thing for the American worker,” Trump said at the signing of his first executive order as President. TPP, which includes 12 other nations, was not voted on in the last Congressional session, so the U.S. was not yet part of the agreement that was expected to increase U.S. seafood imports from Vietnam and other countries.
“This is a lost opportunity for exporters and importers to make the global seafood trade market a more predictable place,” said Gavin Gibbons, vice president of communications for the National Fisheries Institute (NFI).
In addition, the move is a sign that Trump will also act quickly to re-negotiate terms of the North American Free Trade Agreement (NAFTA), which is expected to affect seafood trade between the U.S., Canada and Mexico.
“We must protect our borders from the ravages of other countries making our products, stealing our companies and destroying our jobs. Protection will lead to great prosperity and strength,” Trump said during his inaugural address, The New York Times reported.
Meanwhile, Trump’s executive order – and the failure of Congress to vote on the deal – effectively kills the TPP. The trade deal is structured so that it will not go into effect unless ratified within two years by at least six countries, representing at least 85 percent of the total GDP of the 12 signatories (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the U.S. and Vietnam).
As a result, the Regional Comprehensive Economic Partnership (RCEP), a trade plan backed by China while excluding the U.S., may now gain further support.
RCEP originated from an attempt to forge individual free-trade agreements between the Association of Southeast Asian Nations (ASEAN) and six other countries – Australia, China, India, Japan, South Korea, and New Zealand – into a trade bloc.
The main beneficiaries of the agreement are likely to be China, Vietnam, Thailand and Myanmar, as according to an Economist Intelligence Unit study sponsored by ANZ Banking Group. Broad access through a free-trade agreement to the huge Chinese market while avoiding that country’s rising costs is the main appeal.
For seafood, it would mainly facilitate the movement of Indian and Vietnamese shrimp to China, and may stimulate some movement of further processing of seafood from China to Vietnam.
While global seafood leaders are concerned about Trump’s stance on TPP and NAFTA, some in the U.S. seafood industry are pleased that Trump is focusing on American jobs and boosting the country’s economy.
“We think it [TPP withdrawal] is positive,” said C. David Veal, executive director of the American Shrimp Processors Association. “I speak from the perspective of the domestic shrimp industry. If I exported a lot of product, I wouldn’t think that.”
Still, U.S. withdrawal from the TPP “leaves us fighting the same battles we have been fighting for years,” Veal said. These battles include illegal veterinary drugs occasionally used in Asian farmed seafood production and a general “lack of inspection and control over farmed products.”
Veal also welcomes Trump’s proposed review of NAFTA.
“Any trade agreement that is 25 years old should be reviewed. It may not need to be changed, but it should at least be reviewed,” he said.
Source: SeafoodSource.com