TPP exit could be a prelude to TPP part 2

The US’s friends wonder over the direction Donald Trump is taking

Donald Trump and his transition team are in the process of filling cabinet and other high level positions for his new administration Drew Angerer/Getty Images/AFP

On the surface, one of Donald Trump’s first moves, even before he has become president, looks worrying. By signalling his intention to withdraw from the Trans-Pacific Partnership, he appears to have also demonstrated his intent to withdraw America from the world. But a closer look suggests a more nuanced conclusion. It may not even matter.

TPP is a trade pact between 12 countries around the Pacific, large ones such as Japan and smaller ones such as Peru. Once implemented, it would wipe out tariffs between the 12 countries, making trade between them much easier. Advocates of free trade like it; opponents of unfettered trade hate it.

As with all such early moves by Mr Trump, this will be watched closely. TPP is politically interesting, because it sends different messages. On the one hand, walking away from TPP signals a retreat from trade liberalisation, towards a more nationalist approach from the US. It suggests Mr Trump in office might care less about global trade and focus more on “the homeland”. It also suggests he may rip up treaties if they don’t suit his perspective.

On the other hand, TPP has been unpopular across the political spectrum. It is not only the working-class voters who support Mr Trump who are against the deal: many on the Democrat side are too. Bernie Sanders railed against the TPP during his failed bid for the Democratic nomination, and even Hillary Clinton said she was against it. This may turn out to be one of those policies that appeals across party lines.

In fact, it may also not make much difference to the other 11 nations. If they do enact the TPP, they will have accepted conditions and reforms to their economies insisted upon by the US’s TPP negotiators, including changes to labour rights and environmental protection. New bilateral negotiations between the US and these countries would already have had the hard work done – although there will be some parsing over what bringing “jobs and industry back on to American shores” will ultimately mean. Nevertheless, it will have the effect of a TPP Part 2.

America’s friends may have concerns about the direction of Mr Trump’s administration. But until all the pieces are in, it is premature to judge. And as TPP just might show, under Mr Trump’s apparently unconventional – and controversial – world view might lie a politically acceptable acknowledgement of orthodoxy.