President elect 'kills' pact
Trump ‘scores own goal’ over trade ban
Donald Trump’s decision to scrap a trade deal with the Far East has been described as a “huge own goal” which will hand dominance to China.
Mr Trump said one of his first acts as President of the US will be to pull the country out of the 12-nation Trans-Pacific Partnership (TPP), calling it a “potential disaster for our country.”
Within hours of his statement, Japan and Australia expressed their commitment to the pact, although without it the pact will be unworkable.
Kamel Mellahi, a Professor of Strategic Management at Warwick Business School and an expert on business in China and Asia, said: “The TPP trade deal, yet to be ratified, took years of intensive negotiations and was hailed as a ground breaking free trade deal across the Pacific Countries.
“It is true that, in relative terms, some countries such as Vietnam, Malaysia, Peru, Singapore and New Zealand were expected to benefit more from the TPP trade deal than the US and even Australia.
“It is also true that the TPP trade deal gave multinational corporations enormous powers over governments and states, but the deal was going to bring significant economic benefits to all the countries involved.
“Beside all the potential economic benefits, the TPP trade deal was seen as a manoeuvre to reduce Pacific Rim countries’ dependence on China and tie them to the US economy.
“By announcing that it is going to withdraw from the TPP trade deal, the US has unwittingly scored a huge own-goal.
“I don’t think the remaining 11 countries are going to go it alone. The US withdrawal from the deal will kill it off.
“One cannot see the trade deal working without the US. There is no doubt that China would fill this vacuum and strengthen its economic status in the Pacific Rim region.
“The announced withdrawal has the capacity to do huge damage to the economies of some Pacific Rim countries and one would expect them to move closer to China while reducing their dependence on the US economy.”