TPP Proponent: How Lower Tariffs Under TPP Could Send More Nike Jobs To Vietnam

[cali]

And Harm the Company.

Disclosure: I own shares of NKE

Let me be clear from the beginning. I agree, in principle, with President Obama that the new Trans-Pacific Partnership (TPP) he is promoting will be beneficial for the American economy, and the economies participating in it.

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But in practice, trade accords have winners and losers. That’s why they are so politicized.

So there is one thing hard to understand: how removing US tariffs of footwear and apparel made in Vietnam will induce producers of such products as Nike Inc (NYSE:NKE) to make them here rather than there.

Actually, the argument can be made that now it will be more profitable for Nike to raise production in Vietnam, as the cost differential between US and Vietnam becomes even more favorable for Vietnam!

<snip>

http://www.forbes.com/sites/panosmourdoukoutas/2015/05/09/how-lower-tariffs-under-tpp-could-send-more-nike-jobs-to-vietnam-and-harm-the-company/

[Hoyt]

1. Since 98% of those shoes are made overseas, few, if any US jobs would be involved.

Some shoe manufacturing might go from China to Vietnam. But I think that's a goal of the TPP.