With the rollercoaster of the US elections now coming to a close, it seems that the once lauded Trans-Pacific Partnership trade deal is “Dead on Arrival.” With that change of circumstance comes some unknowns for retailers, shippers, and consumers as well.
The TPP would have marked the largest Free Trade Agreement since the North American Free Trade Agreement (NAFTA) during the Clinton administration. The agreement had some fantastic benefits, but, as has been brought to the surface during this campaign, many American workers felt that it had a negative impact on them.
In reality, TPP would have been to the benefit of the American consumer, as well as retailers and shippers. However, many believed that it would give unfair advantage to foreign countries who have workers that are paid far less. While this would help drive costs down, it would mean less jobs domestically.
So what does the fact that TPP is now stillborn mean? It’s not all doom and gloom. In reality it will mean that manufacturing, and therefore consumption, will be more domestically focused.
The TPP was all but assured to be implemented not just a few months ago, which means shippers and others were already planning for its adoption. Now we are seeing that those very same companies need to re-adjust their plans for the implementation of that agreement.
The seemingly inevitable failure of TPP to be realized comes on the heels of “Brexit” – Britain leaving the European Union. That bombshell also created unique opportunities and changes for the US market.
Brexit, TPP and the outcome of the US elections all point to a trend of pulling back from globalism, and a greater focus on domestic trade. This creates unique opportunities for retailers, shippers and consumers. But it also creates challenges that must be overcome.
So what next? Well, we are seeing an incredible amount of unknowns in the wake of the election. No one really knows if TPP will be renegotiated, or even if other trade agreements will go the same way.