The 11 remaining member countries of the Trans-Pacific Partnership (TPP) struck a deal Tuesday, January 23 to save the multilateral trade deal. President Donald Trump withdrew from TPP as one of his first actions in office in 2017 despite cries from the agriculture sector to move forward with the agreement as it offered opportunities to lower tariffs for U.S. agricultural goods and increase market access to the Asian countries in TPP.
The Comprehensive & Progressive Agreement for the Trans-Pacific Partnership (CPTPP) is a reboot of TPP comprising all of the original members except the United States. The members nearly came to an agreement in November 2017 before Canada backed away and delayed further talks into 2018.
The deal was reached after two days of talks in Tokyo, Japan. Toshimitsu Motegi, Japan’s economy minister, said the new CPTPP would be an “engine to overcome protectionism” emerging in parts of the world.
“The agreement reached in Tokyo today is the right deal,” Canadian Prime Minister Justin Trudeau said at the World Economic Forum in Davos, Switzerland. “Our government stood up for Canadian interests, and this agreement meets our objectives of creating and sustaining growth, prosperity and well-paying, middle-class jobs today and for generations to come.”
“This outcome reaffirms the CPTPP countries’ collective commitment towards greater trade liberalization and regional integration,” Singapore’s Ministry of Trade & Industry said in a statement.
The deal comes at an important time, as the North American Free Trade Agreement (NAFTA) talks resumed this week. Both Cananda and Mexico are part of the CPTPP and have said that they will look elsewhere for trade partners if NAFTA does not move forward.
With the CPTPP deal reached, both Mexico and Canada will have access to valuable Asian markets, which leaves the United States at a competitive disadvantage. A report from CoBank said this will be “disastrous for U.S. agriculture.”
