Not so fast: Conflicting deadlines for the TPP and US-EU FTA

Article Highlights

  • After a fallow first four years, President Obama has suddenly embraced an ambitious — but highly problematic — trade agenda for his second term.

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  • The administration is misguided in bowing to the EU’s frantic plea for a crash, two-year timetable for FTA negotiations.

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  • Such a course will fail — and of much greater significance, it may well imperil a successful conclusion of the strategically and economically vital TPP negotiations.

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  • Trans-Pacific Partnership negotiations have emerged as the central symbol of the U.S. diplomatic and economic ‘pivot’ to Asia.

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President Obama has suddenly embraced a highly problematic trade agenda for his second term.

After a fallow first four years, President Obama has suddenly embraced an ambitious — but highly problematic — trade agenda for his second term. First, he has adopted the goal of completing the hugely complex and politically difficult 11-member Trans-Pacific Partnership agreement (TPP) in the next 12 months. Second, in his State of the Union address the president gave the go-ahead for negotiating a comprehensive free trade agreement (FTA) with the European Union (EU) by the end of 2014.

The administration is misguided in bowing to the EU’s frantic plea for a crash, two-year timetable for FTA negotiations. Such a course will fail — and of much greater significance, it may well imperil a successful conclusion of the strategically and economically vital TPP negotiations.

Challenges to the TPP

The TPP negotiations have emerged as the central symbol of the U.S. diplomatic and economic “pivot” to Asia. Over the past three years, in ever more expansive language, President Obama and former secretary of state Hillary Clinton underlined the strategic importance of Asia. The president averred, “In the Asia Pacific in the twenty-first century the United States of America is all in.” National security adviser Michael Froman explicitly tied the TPP to U.S. economic and security goals: “This really embeds us in the fastest-growing region of the world, and gives us a leadership role in shaping the rules of the game for that region.”

To read the full text of this article, please visit The American website.

Claude Barfield is a resident scholar at the American Enterprise Institute.

 

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About the Author

 

Claude
Barfield
  • Claude Barfield, a former consultant to the office of the U.S. Trade Representative, researches international trade policy (including trade policy in China and East Asia), the World Trade Organization (WTO), intellectual property, and science and technology policy. His many books and publications include Swap: How Trade Works with Philip Levy, a concise introduction to the principles of world economics, and Telecoms and the Huawei conundrum: Chinese foreign direct investment in the United States, an AEI Economic Studies analysis that explores the case of Chinese telecom equipment maker Huawei and its commitment to long-term investment in the US.
  • Phone: 2028625879
    Email: cbarfield@aei.org
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