In his first week in office, US President Donald Trump has been signing presidential orders and directives. In a matter of days, he has already managed some big changes in US trade policy without the approval of Congress.
International trade policy is one area where Trump is eager to flex his presidential muscle. Since 1934, US policy has been geared towards accommodation and internationalism.
But Trump believes too many imports from foreign countries are bad for US jobs and that has implications for the rest of the world. As such, all it took for Trump to exit the Trans-Pacific Partnership (TPP) trade deal was to pick up a pen.
The impetus for TPP was about the pivot towards Asia – linking economies, from Japan to Vietnam, more closely to the US. However, Trump has no interest in giving countries more access to US markets.
Closer to home, The US’s neighbours will also grapple with changes that will affect their economies and relations with the United States.
Trump wants to renegotiate the North American Free Trade Agreement between Canada, US and Mexico.
The physical barrier Trump wants to construct along the US-Mexico border is symbolic of an inward-looking US.
James Bays reports from Washington, DC.
Also on this episode of Counting the Cost:
US-UK’s “special relationship”: Can UK Prime Minister Theresa May find an ally in Trump as her deadline to trigger an EU exit is only two months away? Russell Jones, a partner at Llewellyn consulting, discusses Trump and Brexit. “We’re going to see a more stimulative policy response out of the United States over the course of the next couple of years. Fiscal expansion coupled with deregulation and, of course, there’s also the issue of greater protectionism of the US home market and that is something in the short-term help to hot-house the economy, if you like – keep demand within the borders of the United States.”
While May and Trump were brought to power by the rise of populism, there are some areas of significant differences between them. On May’s visit to the US this week, Jones says, “There’s a certain amount of desperation on the part of the British government. In the context of Brexit, the UK is very keen to reanimate its relationship with the United States, notwithstanding all the elements of Mr Trump’s policies, which frankly, the British government find rather distasteful.”
The US-UK relationship “has always been an asymmetrical relationship – the United States seems to get rather more out of it than the United Kingdom does … trying to reanimate that relationship when you’re a little bit desperate, perhaps, is not the best way to achieve a good outcome. I am not sure this really is going to do the UK a great deal of good in the great scheme of things, but in the context of Brexit, the UK is looking around for other friends,” says Jones.
Making China Great again: Among Asian leaders, there was no surprise about Trump making good on his election promise to withdraw the US from the Trans-Pacific Partnership. But it has left some wondering if the TPP can now be salvaged. Like Australia, Japan is also a security partner of the US. Both governments worry about the consequences of a US retreat from Asia. But as Trump pivots away from Asia, will he actually be making China great again? Andrew Leung, CEO of the Hong Kong-based Andrew Leung International Consultants, thinks the world’s next biggest economy will take on an even bigger role in the region.
Chinese New Year: According to the Chinese lunar calendar, New Year falls on January 28 in 2017, and is marked by around one-sixth of the world’s population. Adrian Brown reports from Beijing on how people in China feel about the economy as the year of the Rooster dawns.