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Vietnam cools on TPP trade pact after Trump election

by November 18, 2016 General

Vietnam’s prime minister on Thursday backed away from the Trans-Pacific Partnership (TPP), the massive US-led trade pact that president-elect Donald Trump vowed to scrap during his raucous White House campaign.

Manufacturing hub Vietnam stands to gain enormously from US President Barack Obama’s signature 12-country free trade deal, which notably excludes China.

Trump, who is set to take office in January, has said he opposed the deal and has previously promised to get rid of it, saying it would be a death knell for American jobs and manufacturing.

He has not said definitively what would happen to it since his shock election victory on November 8, but analysts doubt whether the trade pact will survive.

Communist Vietnam previously said it would wait until after the US elections to decide whether it would ratify the deal.

Prime Minister Nguyen Xuan Phuc on Thursday confirmed that ratification would not happen during the current parliamentary session that ends on November 22. 

“Vietnam does not have a strong enough basis to propose the joining of TPP,” he told lawmakers at the rubber stamp parliament, the National Assembly, referring to the current status of the deal in the United States.

He added that the United States and Vietnam would maintain close ties and said his country would continue to pursue international trade deals. 

“Vietnam continues to have deep and wide integration. We have 12 free trade agreements and if we don’t participate in TPP, we will still proceed with pacts already signed, including with ASEAN.”

Many economists argued that low wage Vietnam was one of the countries that would have benefited the most from TPP, adding more than 10 percent to its GDP over a decade.

The TPP would have granted Vietnam preferential access to major markets, namely the United States, Japan and Canada. 

Trump is set to meet with Japanese Prime Minister Shinzo Abe on Thursday in New York, where the landmark trade deal could be discussed.  

The trade deal has been a major priority for the Obama administration, and a key component of his “pivot to Asia” policy. 

It became a hot-button issue during the US election campaign, and Trump’s Democratic rival Hillary Clinton even expressed misgivings about it.

The TPP must be ratified by all participating countries: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam.