Despite opposition from Congress and both major party presidential candidates, President Barack Obama made another move last week to pass the Trans-Pacific Partnership, sending lawmakers a statement of administrative action on how the TPP will be implemented and enforced.
But because both Hillary Clinton and Donald Trump oppose the TPP, a trade agreement connecting 12 countries including the U.S. and Japan that was signed in February, Congress is unlikely to approve the deal this year.
The TPP does, however, have some support in the business community, including the U.S. Chamber of Commerce. And UPS CEO David Abney told CNBC's "Squawk Box" this morning that the agreement could increase U.S. exports by 20 percent and also cut tariffs and red tape. "It [also] opens up markets to U.S. companies, especially those small and mid-sized businesses companies," Abney said.
The TPP was designed to remove a host of trade barriers among participating nations, such as quotas and regulations, with hopes of stemming China's economic power in the region.
According to Ernie Preeg, senior advisor for international trade and finance at the Manufacturers Alliance for Productivity and Innovation, the U.S. needs a free trade agreement with Japan. If the TPP fails and a proposed China-South Korea-Japan tripartite free trade agreement goes through, the U.S. would be at an economic disadvantage.
"China is already the No. 1 trading partner for South Korea and Japan, and if this tripartite free trade agreement goes forward and the TPP fails, the United States will be left outside, paying higher, 'most-favored-nation' import charges in the Japanese and Chinese markets," Preeg wrote when the full text of the Trans-Pacific Partnership was released last year.
