Reference no: EM132946264

Case Title: Creating the World's Biggest Free Trade Zone

This case explores the Trans Pacific Partnership (TPP), what it entailed, why it fell apart, and what is replacing it. Signed in 2016, the TPP, negotiated among 12 countries including the United States, was a highlight of President Obama's trade policy. The agreement was designed to reduce trade barriers and encourage investment among participants including the United States, Japan, Australia, New Zealand, Chile, Canada,

Mexico, and Vietnam. The 12 signatories accounted for 36 percent of world GDP an 26 percent of world trade.

Under the agreement, about 18,000 tariffs, taxes, and nontariff bariers were to be eliminated, while market access would increase. Despite these benefits, critics of the TPP including Bernie Sanders and Donald Trump were vocal in their opposition. Bernie Sanders claimed the agreement was a victory for Wall Street and other big corporations." Donald Trump described the trade agreement as "a terrible deal" and following his election, in one of his first actions in office, withdrew the United States from the deal.

Despite the withdrawal of the United States from the TPP, the remaining signatories decided to go forward the agreement. renaming it the comprehensive and Progressive Trans Pacific Partnership (CPTPP). The new deal, signed in 2018, lowered trade barriers among the remaining 11 nations. New Zealand's Trade Minister calls the new agreement more important than ever and many leaders have left the door open for the United States to join in the future.

Discussion Questions

1. What are the benefits of the proposed TTP? Explain

What were the potential drawbacks of the U.S. entering the TPP? Explain

What would be the drawbacks to other nations? Explain

3. Why do you think Donald Trump was so adamantly opposed to the TPP? Explain

4. Why do you think the 11 remaining signatories went ahead with a revised deal after the United States withdrew? Explain