Trump entered office promising to deliver bilateral trade agreements that would improve upon the 12-nation Trans-Pacific Partnership (TPP). He has been unable to deliver on such pledges for at least five reasons.
First, Trump’s withdrawal from the TPP and his stated desire to pull out of the KORUS agreement and the North American Free Trade Agreement (NAFTA) highlighted the fickleness of his fidelity to existing agreements, even with America’s closest allies.
Second, Trump adopted a maximalist, uncompromising, take-it-or-leave-it-approach to renegotiating NAFTA and KORUS, which is having a chilling effect on any country considering entering into trade negotiations with Washington.
Third, Trump failed to appreciate the integrated nature of value chains in Asia, which have diminished the significance of bilateral free trade agreements.
Fourth, Trump has suggested he wants to use trade agreements to eliminate bilateral trade deficits, as opposed to focusing on market access.
This misguided approach ignores that a trade balance equals the difference between savings and investment.
Source: Time to rethink U.S. trade strategy in Asia