At least nobody could accuse Mr Trump of caring for the poorer neighbour at his gate. Despite the US taking almost one quarter of the world’s GNP, Mr Trump, President of a nation encompassing only 5 % of the world’s population, has convinced his big business constituents that they deserve more. The twenty five year old trade treaty with Canada and Mexico NAFTA he told his fans, was unfair and as a consequence needed reorganization in America’s favour. And at first glance, this is exactly what he has accomplished.
NAFTA 2, now renamed with the US first as the “US, Mexico Canada agreement” (USMCA) Mr Trump tells us, gives the US a better share. No doubt many will assume that outside these three nations, this internal arrangement simply sends the US back into virtually the same agreements as it has had for the last 25 years …nothing to do with us? Well, look again.
The new pact says any party that negotiates a free trade agreement with any non market country (like say for example China, New Zealand or for that matter any of the TPP nations) must first disclose this fact along with the proposed text of the agreement, and if this text upsets one of the partners (say the US, to name one at random!) continuing with the agreement can mean being thrown out of the Trade Partnership with the USMCA. Does this mean if Canada signs a free trade agreement with New Zealand it risks its own USMCA status because New Zealand is developing trade ties with China?
Since other nations are trying to arrange free trade with nations like China, and because the US is such an attractive big market the signals are there. Again, staying with my own nation, New Zealand, our own trade agreements and arrangements still awaiting ratification are now at risk. China has already supplanted the US as our second biggest trade partner and in recent years has been a more reliable partner. We certainly cannot risk our market share in the US but we should be under no illusion that the US will allow us to develop future arrangements with China without placing obstacles in our way.
Being a friend and neighbour to the United States is becoming problematic. The big pharmaceutical corporations already dictate what we are allowed to do in our own trade arrangements and health care situation. For example although the Big Pharma companies are quite happy to take over the patents of cancer drugs including those developed in this country, they then only allow drugs which are reaching the end of their patent to be replaced by non generic copies for our health system. In short, seriously ill patients cannot access the best available drugs at affordable prices. It is an open secret that the Senate signatories in support of Big Pharma convinced Mr Trump to withdraw from the TPP (or so a recent medical conference in New Zealand was told!!).
Law Professor Jane Kelsey reminds us that Prime Minister Jacinda Ardern has identified the stark choice of the multilateral rules-based system emerging out of 30 years of neo liberalism or the unilateral power plays of a popularist and protectionist autocrat. I wonder who that could be?