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(2nd LD) Trump signs executive order withdrawing U.S. from TPP

All News 05:01 January 24, 2017

(ATTN: UPDATES with statement from John McCain in paras 5-8)
By Chang Jae-soon

WASHINGTON, Jan. 23 (Yonhap) -- U.S. President Donald Trump on Monday signed an executive order withdrawing the U.S. from a massive Asia-Pacific free trade deal in a move that makes good on his campaign promise and underscores his protectionist stance on trade.

During and after the campaign, Trump has repeatedly pledged to pull the U.S. out of the hard-won deal, known as Trans Pacific Partnership (TPP), which calls for tearing down trade barriers among 12 Asia-Pacific countries, including the U.S. and Japan.

On Monday, Trump signed the measure on TPP, saying, "We've been talking about this for some time."

After the signing, he said it's a "great thing for the American worker" and showed the signed order to the press at the Oval Office, as Vice President Mike Pence, White House chief of staff Reince Priebus and other senior staff looked on.

(2nd LD) Trump signs executive order withdrawing U.S. from TPP - 1

The TPP, which was concluded in October 2015 but has not won congressional ratification, would have created the largest trading bloc in the world, accounting for about 40 percent of global gross domestic product. The deal has been touted as a key symbol of former President Barack Obama's "pivot" to Asia policy.

Sen. John McCain (R-AZ) criticized the withdrawal as a "serious mistake that will have lasting consequences for America's economy and our strategic position in the Asia-Pacific region."

"This decision will forfeit the opportunity to promote American exports, reduce trade barriers, open new markets, and protect American invention and innovation. It will create an opening for China to rewrite the economic rules of the road at the expense of American workers," McCain said.

"It will send a troubling signal of American disengagement in the Asia-Pacific region at a time we can least afford it. Abandoning TPP is the wrong decision. Moving forward, it is imperative that America advances a positive trade agenda in the Asia-Pacific that will keep American workers and companies competitive in one of the most economically vibrant and fastest-growing regions in the world," he said.

Trump has blamed free trade deals as a key cause of job losses and other American economic problems in an attempt to woo voters struggling with economic difficulties. He has also pledged to renegotiate the North American Free Trade Agreement (NAFTA).

Protecting American companies and workers from foreign competitors is Trump's No. 1 priority.

During his inauguration address, Trump said he will "protect our borders from the ravages of other countries making our products, stealing our companies, and destroying our jobs." He also said "protection will lead to great prosperity and strength."

The White House released major policy points of the new administration on inauguration day, including withdrawing from TPP and renegotiating NAFTA. Unless a fair deal is reached in renegotiations, Trump will withdraw from NAFTA, it said.

The White House also pledged to crack down on countries violating trade agreements and harming American workers, saying Trump will direct the commerce secretary to identify all trade violations and to "use every tool at the federal government's disposal to end these abuses."

Earlier Monday, Trump held a breakfast meeting with key business leaders, and promised to make the U.S. a better country to do business with by massively cutting taxes and regulations. But he also warned against moving companies overseas, saying such firms will face a hefty border tax on products they're bringing back into the country.

During the campaign, Trump also spoke very negatively of the free trade agreement with South Korea, denouncing it as a "job-killing" deal and a "disaster." Since the election, however, he has not made any public mention of the pact.

The Korea-U.S. FTA, which went into effect in 2012, has been viewed as an economic alliance between the two countries.

South Korean officials say the deal has been mutually beneficial. Even though the U.S. has a deficit in goods trade, the country has about $10 billion worth of surplus in services trade, and South Korea has made more investments in the U.S. than the U.S. did in South Korea, they say.

The U.S. International Trade Commission (ITC) said in a report in late June that the Korea deal has been good for American interests, saying the agreement is estimated to have improved bilateral merchandise trade balances by $15.8 billion in 2015.

That means that had it not been for the deal, the U.S. trade deficits would have been larger.

jschang@yna.co.kr
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