Trump Talks TPP, but Trade Partners Say, Not So Fast

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President

Donald Trump

is talking again about getting the U.S. into a Pacific Rim trade agreement. But any serious effort to do so would be fraught with difficulty, not least because Mr. Trump is demanding a “substantially better” deal than what Washington got two years ago.

After the U.S. dropped out of the Trans-Pacific Partnership last year, the remaining 11 nations struck their own TPP deal, and sealed it at a March ceremony in Chile. Each country is now moving ahead with ratification. Mr. Trump’s suggestion Thursday that the U.S. might want to join after all left many nations concerned that the process could get disrupted.

“We’ve got a deal. It’s a good deal. Eleven countries have signed up and we’re firm on the deal,” said Australian Trade Minister

Steve Ciobo.

“I can’t see all that being thrown open now to appease the United States, but we would welcome the U.S. coming back to the table.”

Japan’s top government spokesman,

Yoshihide Suga,

compared the TPP deal to a piece of “delicate glasswork” and added: “To take out one part and renegotiate would be extremely difficult.”

U.S. participation in the TPP is still an attractive prospect for many of its members because it would lead to lower tariffs in the huge American market for products like Malaysian palm oil and Vietnamese apparel. Some members, particularly Japan, like the idea of cementing the U.S. economic presence in the region as a bulwark against China.

An October 2017 paper from the Peterson Institute for International Economics estimated that real income in Vietnam and Malaysia would rise by around 8% by 2030 from the 2015 level if the nations were in a TPP deal that included the U.S. The expected gain from an 11-nation TPP without the U.S. was less than half as big.

The original TPP deal, signed in February 2016 in New Zealand, was led by the U.S. under the Obama administration and, at Washington’s insistence, included some provisions sought by U.S. pharmaceutical and movie companies.

One generally required eight years of patent protection for biotechnology drugs—a provision that Australia in particular fought against. Other provisions, opposed by Canada and New Zealand, would have extended copyright protection to 70 years after the death of an author from 50 years.

Once the U.S. dropped out, the remaining 11 countries froze those provisions.

The TPP members, led by Japan, have urged Mr. Trump over the past year to reconsider joining the group. Officials in Tokyo have generally recognized that if the U.S. came back, it would insist on the frozen provisions being restored.

But a late-night tweet by Mr. Trump suggested that wouldn’t be nearly enough. “Would only join TPP if the deal were substantially better than the deal offered to Pres. Obama,” the president tweeted. He threw in a jab at Japan as well, saying it “has hit us hard on trade for years!”

Yorizumi Watanabe,

a former Japanese trade negotiator now at Keio University, said allowing the U.S. to put new issues on the table was “ridiculous.”

“The U.S. had agreed with TPP-12 and then left, and says it wants more on its return. That is not acceptable—it is against negotiation rules,” Mr. Watanabe said.

He said if the U.S. makes new demands, one might be to extend the exclusivity on biologic drugs to 12 years, as the Obama administration initially wanted before compromising with Australia on an eight-year period. The U.S. might also ask Japan to remove its tariffs on rice, which it didn’t push for in the original TPP in deference to Japanese sensitivities, Prof. Watanabe said.

Malaysia Trade Minister

Mustapa Mohamed

sounded a cautious note, saying that renegotiating significant changes would be difficult. “We have achieved a balanced deal for all parties involved,” he said. “Renegotiation will not only take a long time but also alter the balance of benefits for parties.”

Mexican President

Enrique Peña Nieto

said Friday the U.S. was welcome to reconsider joining a Pacific Rim trade agreement. “The door is open for the United States to reconsider it…and take advantage of the TPP,” Mr. Peña Nieto. “We do not believe in protectionism. We believe firmly in openness and competition.”

Mr. Peña Nieto made the comments at a business conference in Peru’s capital ahead of a summit of leaders from the Western Hemisphere.

In addition to their reluctance to reopen old issues, several TPP countries are wary of being used as leverage by the Trump administration in the escalating U.S. trade dispute with China. While some TPP members have viewed the group as a way to limit Beijing’s ambitions for regional leadership, it has never been overtly anti-China and, in fact, some have envisioned China would eventually join.

“If it becomes an explicit China containment strategy then that is politically really difficult,” said

Deborah Elms,

director of the Asian Trade Centre in Singapore, a business-funded group that studies trade policy.

Ms. Elms also said Asian nations might be reluctant to negotiate with a U.S. president whose positions often change. “They went through five years of bruising negotiations with the United States only for the U.S. to stand them up at the altar,” she said.

Write to Rob Taylor at rob.taylor@wsj.com, Chieko Tsuneoka at chieko.Tsuneoka@dowjones.com and Jake Maxwell Watts at jake.watts@wsj.com



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