The Pacific Alliance after Trump

I would like to share with you some views on the foreseen implications of  Trump’s future presidency for the PA.

 Photocredits: coward_lion/ trump_coward_lion
Unlike the enthusiasm showed by Obama about the establishment and progress of the PA, it is expected that President Trump will not give high relevance to the PA in his foreign trade policy, especially if his manifested approach is bilateral agreements rather than regional. It will be interesting to see if he decides to withdraw the status as an observer state of the process, but this move will certainly not be a priority on his list of concerns. This decision would have political costs that he might not be interested in paying, especially because there has not been a particularly strong working agenda with the US derived from its position as an observer.

The PA has concluded cooperation agreements with Canada and ASEAN but not the US. The likelihood of a future partnership or cooperation agreement between the PA and the US during Trumps’ presidency is rather low, to say the least.

Trumps’ Presidency represents an opportunity for Mexico to strengthen its economic ties with its other PA allies to diversify its commercial partners to reduce the economic dependency on the US.  The new scenario could benefit and push the PA economic outcomes. This time driven not only by desire but also by eventual economic necessity based on the actual approach that Trump decides to take towards Mexico once in charge.

Elected President Trump has not expressed any support or interest for the peace talks in Colombia, in fact he has kept quiet on this topic. The future implementation of the peace agreements in Colombia, if approved, has lost an important regional ally —the United States. Possible economic, technical or capacity building support to the implementation process of the agreements seems off the table today.

Trumps’ approach to the region ultimately could lead to a decline in the regional leadership of the US within the Americas, because the domestic agenda that brought him to the White House will take precedence over any regional issue that is not directly under the radar of its electors.

The chances of TPP being approved by the US Congress during the lame duck, fade with the days, and this was the last and only chance for the agreement to be approved. As the Congress returns this week, TPP is not part of the agenda, while Senate majority leader, Mitch McConnell, has stated that “it is certainly not going to be brought up this year.” The possible failure of the TPP would represent the loss of economic opportunity for the PA members individually (Mexico, Chile and Peru), especially for Peru which was estimated to benefit the most. It would be a lost chance to update bilateral trade agreements for Chile and Peru, and NAFTA in the case of Mexico.

However, a more integrated and positive view of the situation will suggest that it will force the PA  to focus on its regional strategy towards Asia-Pacific as one of the main pillars of the integration scheme. PA will be for a while its members best chance to reach Asia Pacific.

There is no need to reinforce the uncertainty that Trump’s election brings regarding US Foreign Policy for Latin America and the PA as a whole. The situation results from the divisive rhetoric of his electoral discourse and some troublesome policy proposals. Institutional restrictions that come from a system governed by the rule of law and the separation of powers alleviate, to some degree, the concerns because many of his election promises are unpractical, unlikely, politically and economically costly to be implemented.

It is yet to be seen whether Trump will maintain the ‘unorthodox political style’ of its ‘young political career’ manifested during the electoral campaign or will shift towards a more moderated version of it.

I look forward to hearing your comments and views!

Sources: Infolatam; Brookings, Bloomberg BNA