To Trade or Not To Trade
The Florida Chamber of Commerce was in Washington, D.C. recently addressing many issues including international trade. Trade and free trade agreements were one of the key issues during the presidential campaign. President-elect Trump was particularly emphatic in his opposition to the TPP and his calls for a review of NAFTA as well as our trade relationship with China.
For decades, free trade agreements have been part of our economic tool kit and international trade is one of the leading factors attributed to Florida’s economic recovery. Two and a half million Floridians are employed thanks to international trade. Our record-breaking tourism numbers benefit from international visitors and there are thousands of foreign companies operating in Florida that employ Floridians.
So What Happens Now?
It is all but certain that the Trans-Pacific Partnership (TPP) is no longer on the table. Our partners in the region still hope to revive trade talks with the U.S. and many are willing to reopen TPP and make revisions which might make it more palatable to the new administration. This weekend at the Asia-Pacific Economic Cooperation (APEC) CEO Summit in Lima, Peru, the future of trade and the role the U.S. would play in Asia was a top concern. China and Russia issued a statement that they will push for a free-trade area in the Asia-Pacific region. Neither country was part of the TPP.
China is pushing to finalize its parallel free trade agreement in Asia, the Regional Comprehensive Economic Partnership (RCEP), which includes all the ASEAN (the Association of Southeast Asian Nations) countries plus Australia, New Zealand, Japan, Korea, India, but it currently excludes the U.S.
Not Anti-Trade. Pro “Good Deals.”
From our meetings in Washington, D.C., it was clear that it was too soon to tell regarding the fate of many trade issues. Reviewing trade policy will be one of the first tasks tackled by the new administration. Re-negotiating and/or withdrawing from NAFTA as well as pulling the plug on TPP were at the top of the list. Trade would not be off the table completely however, and there is a greater appetite for bilateral trade agreements over the larger multi-nation deals like TPP. Should the U.S. withdraw from NAFTA, the new administration has proposed it would negotiate separate bilateral deals with Mexico and Canada. China and currency manipulation were also topics discussed in D.C.
It is also important to note that in 2015, Congress granted the President Trade Promotion Authority – or “fast track” – power for the President to negotiate trade agreements and move them more swiftly through Congress until 2018 and it could be extended until 2021.
Fair Trade, Not Just Free Trade – Leveling the Playing Field
Much like during the campaign, the new administration has outlined that they will be working to ensure agreements are enforced and that our trade partners are not engaging in “harmful” practices. They will also be reviewing country of origin labeling and environmental and safety standards, as well as considering the impacts trade policy has on the middle class, manufacturing and workers, and foreign direct investment.
The Florida Chamber will continue to monitor developments and we will be working in the in the best interest of Florida’s businesses to support trade agreements that help our exporters access the global market place and provide our workers access to high-wage jobs.
These discussions and more will be a key part of the conversation at the Florida Chamber’s 2017 International Days, Feb. 14 and 15 in Tallahassee. Be sure to join us by registering today!