Pacific trade deal to raise U.S. annual incomes by $131 bln-study

By David Lawder
WASHINGTON, Jan 25 (Reuters) - The Trans-Pacific Partnership
trade deal would raise U.S. incomes by $131 billion annually
after 2030, and a one-year delay in its implementation would
cost $77 billion in lost income, a think-tank study showed on
Monday.
The Peterson Institute for International Economics said its
analysis of the TPP deal reached in October between the United
States and 11 other Pacific Rim countries found that it would
boost U.S. exports by $357 billion annually, and by $1.025
trillion annually for all TPP countries together.
Annual incomes for the 12 TPP countries would be $465
billion higher after full implementation in 2030 and $492
billion higher for the whole world, Peterson said.
The study from the Washington-based, pro-trade economic
policy group took a neutral stance on overall job effects,
however, using a forecasting model that assumed no net change in
employment directly resulting from the pact -- only shifts in
allocations of jobs.
It did show that there would be some 53,700 U.S. jobs that
would "churn" annually during TPP's 15-year implementation
period, resulting in job losses in some sectors offset by gains
in others.
It estimates that by 2030, some 796,000 jobs will have been
added in U.S. export activities due to TPP, with some of these
shifted from firms facing stiffer import competition.
"The present analysis does indicate that the benefits of the
TPP to the U.S. economy will greatly outweigh adjustment costs,
and that economy-wide price and employment consequences will be
limited," Peterson said in the report.
Republican leaders in the U.S. Congress have yet to schedule
a vote on TPP, which is viewed as essential to the pact's
success. Some prominent lawmakers have cautioned against trying
to approve it before the 2016 U.S. presidential election in
November.
Many TPP opponents in Congress have raised concerns about
the trade deal's effects on existing U.S. manufacturing plants,
particularly in industries that are vulnerable to low-cost
imports, such as auto parts, steel and apparel.
While the Peterson study estimated that overall employment
in manufacturing would continue to grow in the United States,
TPP would reduce that growth rate by one-fifth, resulting in
121,000 fewer manufacturing jobs in 2030 than without the pact.
U.S. Trade Representative Michael Froman said in a statement
that the Peterson study "shows that TPP will raise wages for
American workers, grow our economy, and help farmers and
businesses export more 'Made in America' products."
The study assumes that implementation of TPP would start in
2017. If this were delayed by one year to 2018, it would reduce
the present value of the increased U.S. income generated by the
trade deal by around $77 billion, with a possible range of $59
billion to $115 billion.