08.02.17 – Spesa News

'TPP 12 Minus One'

President Trump took the first step towards implementing his economic agenda. US out of TPP was one of Trump's core campaign promises.

President Trump took the first step towards implementing his economic agenda -- signing an executive action removing the US from the free trade deal Trans-Pacific Partnership (TPP).

This was one of Trump's core campaign promises. The accord was negotiated by the Bush and Obama administrations. The Obama Administration had pushed for the 12-country regional free trade agreement, arguing it was a vital national security priority to compete with a rising China.

TPP Was a Non-Starter from the Beginning

Trump's decision not to join the TPP was expected as during his election campaign he railed against international trade deals, blaming them for job losses and focusing anger in the industrial heartland.

TPP negotiations had begun almost 10 years ago and was designed to create major changes in the economies of the 12 signatory countries. The countries involved previously made up 40 per cent of the world economy. The agreement began as almost casual negotiations between New Zealand, Brunei, Singapore, and Chile but rapidly expanded.

The final agreement was signed by Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, United States, Vietnam, and Australia. Each country needed to pass and ratify associated legislation for the partnership to begin.

What's in It for Fashion Companies

A number of footwear and apparel brand and organizations, including the Footwear Distributors & Retailers of America and the American Apparel & Footwear Association as well as brands, such as Nike, New Balance, Gap, and Hanes, have been supporting TPP.

These parties have cited the TPP's promise to eliminate more than 18,000 taxes and other trade barriers, strengthen ties among member countries and increase economic growth.

According to Matt Priest, President, Footwear Distributors & Retailers of America, the TPP was all about the inclusion of Vietnam, a hub of shoe manufacturing, and that's where lies the interest of American companies. If there are any better trade pacts to tie-up with Vietnam, we would be keen to scrap the TPP. Agreeing on the same, Julia K. Hughes, President, US Fashion Industry Association, echoed this notion, that free trade agreements are important to our sector.

'TPP-12 Minus One'

However, even though the US is out of the treaty others are promising to go ahead with the deal. Australia and New Zealand say they are hopeful of pressing ahead with the Trans Pacific Partnership trade deal, despite America's formal withdrawal. Australia has already devised a name for a possible new agreement: TPP 12 Minus One.

(source: Behind the seams, February 7,2017)