International trade will be an important test of leadership for the winner of the 2012 U.S. presidential election, says CFR’s Thomas Bollyky. "On one hand, U.S. interests in international trade have never been greater," he says. As U.S. consumer spending remains sluggish, international trade and access to fast-growing developing markets will drive U.S. economic and employment growth in the future. "On the other hand, however, U.S. popular and political support for the initiatives needed to take advantage of these opportunities has perhaps never been lower," he says.
Bollyky highlights three opportunities for the president to make progress on international trade efforts: the Trans-Pacific Partnership (TPP) talks, enforcement of trade with China, and liberalization at the World Trade Organization (WTO).
The TPP agreement is "a potential regional platform for trade investment in the important Asia pacific region for years to come," Bollyky says. However, the president will face uncertainty as to whether the United States will be able to conclude and enact this agreement due to domestic U.S. political divisions, he says.
In engaging with China over trade enforcement, the new U.S. president will have to "walk a fine line between fulfilling campaign promises to level the playing field for U.S. investors and companies with avoiding a trade war with China in the midst of a economic recovery that is still fragile after the recession," Bollyky argues.
With the most recent negotiation round at the WTO, the Doha Development Agenda, stalled, the president is going to have to "find ways to make progress at the WTO, even if these involve more modest sectorial initiatives or reforms to the dispute resolution process," says Bollyky.