This article is about a new free-trade deal between 12 Pacific Rim countries including the U.S. and New Zealand. The other countries in the deal are Japan, Canada, Mexico, Australia, Malaysia, Singapore, Peru, Chile, Vietnam, and Brunei. The agreement will boost trade and eliminate most tariffs and other barriers. Each country still has to vote on it and the decision in the U.S. is still being debated. People that oppose this agreement say that it will give too much power to U.S. corporations. Our U.S. trade representative, Michael Froman, said that he believes it will pass.
http://www.beaumontenterprise.com/news/world/article/US-11-other-countries-sign-free-trade-deal-in-6805106.php
Even though a new trade agreement eliminates tariffs and promotes trade, it doesn’t favor exporting over importing. Even though it will be cheaper to trade because tariffs won’t be as high net exports could potentially remain constant, not improving US GDP overall. Since the US still produces goods at the same rate it might be more enticing to export to those countries because it is cheaper; at the same time though it might be more attractive for US companies to move manufacturing to one of the 12 countries and then use the trade agreement to have lower costs and export the goods to the same base in the US.
ReplyDeleteInteresting. My parents just got back from a trip to New Zealand, and my dad told me that this was getting covered way more over there than it is here. Many New Zealanders view this as an opportunity to establish themselves on a trade level closer to the US. While this will likely take awhile due to the massive economic size disadvantage, it is a step in the right direction.
ReplyDeleteI think this article comes at a good time now that we are considering an open economy. I also agree with Sam in that this is a step in the right direction for both the U.S. and the other countries in the agreement, since ultimately as the article discusses it should increase trade significantly for everyone in the deal. However, China is missing as the article mentions saying that they are "forging ahead with its own trade deals". It will be interesting to see what these will be and whether or not they are hurting themselves by doing this.
ReplyDeleteFor America, this agreement improves American products get into Asian market. To some extent, this will increase the export and the next export of the US, and finally increase the American GDP. However, at the same time, because the cheaper labor and resources of other Pacific Rim countries like Mexico, Malaysia, Peru, Chile, Vietnam, and Brunei, it's easier for American companies moving to those countries. This would cut American local positions which causes the employment problem to be more serious.
ReplyDeleteI think this is great. This will increase trade and overall the economies involved should see an increase in their own GDP.
ReplyDeleteI agree with Van and Chris , this is a great opportunity and it will help with the trade balance for New Zealand where they'll get more exposure to the world financial markets thereby increasing trade and investment in New Zealand over the long term.
ReplyDeletehttp://www.beaumontenterprise.com/business/article/Trans-Pacific-Partnership-text-finds-support-6623077.php
ReplyDelete^Here's a more detailed article about how exactly the trade deal will impact the U.S.
Having read this, I do not see any reason why it wouldn't pass, especially given how profitable this deal is.
http://www.beaumontenterprise.com/business/article/Trans-Pacific-Partnership-text-finds-support-6623077.php
ReplyDelete^Here's a more detailed article about how exactly the trade deal will impact the U.S.
Having read this, I do not see any reason why it wouldn't pass, especially given how profitable this deal is.
http://www.beaumontenterprise.com/business/article/Trans-Pacific-Partnership-text-finds-support-6623077.php
ReplyDelete^Here's a more detailed article about how exactly the trade deal will impact the U.S.
Having read this, I do not see any reason why it wouldn't pass, especially given how profitable this deal is.