TPP – ITC Report Released. Late Wednesday afternoon, the ITC released its report on the effects of the proposed TPP on the U.S. economy. The nearly 800-page report examines specific industry sectors in the United States and seeks to ascertain which would benefit or suffer from the deal. U.S. Trade Representative Michael Froman immediately issued a statement welcoming the report and saying:
“The ITC report provides another strong argument for why TPP should be passed this year. It is part of a growing body of evidence that shows that TPP will benefit our economy at home and allow the U.S. to help set the rules of the road for trade in the Asia Pacific.”
Others have noted the ITC report reflects the United States will only marginally benefit from the deal, particularly in comparison to other TPP member states. AFL-CIO President Richard Trumka said of the ITC report in a statement:
“One of many shockers is just how meager the purported benefits of the TPP are. A mere 0.15 percent of GDP growth over 15 years is laughably small.”
Ambassador Froman sought to counter anti-TPP critics by observing the ITC report focused heavily on tariffs and did not reflect the economic benefits of other major parts of the agreement, such as rules on state-owned enterprises, labor and the environment. The report notes that the U.S. agricultural sector is expected to benefit from the agreement, highlighting that overall agricultural exports would rise by $7.2 billion, while imports would increase by $2.7 billion. The report reflects that U.S. rice exports would be worse off under TPP, dropping 0.3 percent. The TPP deal is also reported as increasing the trade deficit in chemicals, a category that includes pharmaceuticals.
After the release of the report, Senate Finance Committee Chairman Orrin Hatch (R-Utah) said:
“The Trans-Pacific Partnership trade agreement has the potential to yield significant economic benefits for American manufacturers, farmers, ranchers, and entrepreneurs. Of course, full and faithful implementation of the agreement by our trading partners is necessary for the benefits of TPP to be realized and for the agreement to gain the strong bipartisan support necessary for its approval by Congress.”
White House Spokesman Josh Earnest said the Administration is working with Democratic and Republican supporters of the TPP to “develop a legislative strategy for moving forward.” There is, however, a general belief in Washington that if the 114th Congress is unable to advance the TPP deal before it concludes later this year, there will be little momentum in the next Congress or new Administration.
President’s Asia Trip. President Obama’s latest trip to the Asia-Pacific continues to demonstrate the Administration’s focus on the region. The Asia rebalance has been a central objective of the President’s broader foreign policy and economic policy, rooted in the belief that this largest-emerging market in the world is critical to U.S. future prosperity and is also host to some critical U.S. national security interests.
His stop in Vietnam is intended to highlight the U.S. partnership with the country. President Obama will give a speech to the Vietnamese people next Tuesday, describing the advancing U.S. Vietnamese bilateral relations, as well as addressing areas of difference.
In Japan later in the week to attend the G-7 Summit, the President will emphasize the important U.S.-Japan alliance, which is considered a cornerstone of the U.S. approach to stability and security in Asia. The G-7 Summit is expected to also discuss the excess steel capacity issue.
U.S. Trade Representative Michael Froman will travel with President Obama to Vietnam. At a press briefing on the President’s trip, Ambassador Froman said that he expects the President will discuss the TPP ratification process and outstanding Transatlantic Trade and Investment Partnership (TTIP) concerns at the G-7 Summit in Japan.
Signed into Law. President Obama signed H.R. 4923, the American Manufacturing Competitiveness Act of 2016, into law on Friday, 20 May. This measure reforms the process by which Congress will consider future Miscellaneous Tariff Bill (MTB) legislation.