The Office of the U.S. Trade Representative is requesting comments on whether the set of tariff exclusions on Chinese imports on Section 301 List 1 that are set to expire May 14 (see 1905100034) should last another year, it said in a notice. The agency will start accepting comments on the extensions on March 12. The comments are due by April 12, it said. The USTR has granted extensions to only six exclusions so far (see 1912190060).
President Donald Trump said that although it is a fact that there's only one titanium sponge producer in the U.S., and that's a threat to national security, he agrees with the Commerce secretary that measures aside from restricting imports are the best way to deal with the problem. Trump made the announcement Feb. 27. Imports accounted for 68% of U.S. consumption in 2018, the year that TIMET asked for a Section 232 investigation; nearly all come from Japanese suppliers.
A Canadian government analysis of NAFTA's replacement -- known as the Canada-U.S.-Mexico Agreement in that country -- estimates that it will increase Canadian GDP by just under 0.25% over five years. The estimate is based on comparing CUSMA to a withdrawal from NAFTA, not from the present trade deal.
CBP Acting Commissioner Mark Morgan acknowledged that the agency has not been able to spend the hundreds of millions of dollars Congress has provided to purchase non-intrusive screening equipment for ports of entry. Rep. Pete Aguilar, D-Calif., had asked: of the $182 million sent to CBP for non-intrusive inspection equipment in fiscal year 2018, the $264 million in fiscal year 2019 and the $60 million sent in the current fiscal year, how much has been spent?
The European Union's Committee on International Trade Chairman Bernd Lange, in a roundtable with trade reporters Feb. 27, said that he asked officials from the Office of the U.S. Trade Representative if there's any truth to rumors that the U.S. will either pull out of the government procurement agreement at the World Trade Organization, or that it will seek to raise its bound tariffs, a process that would begin at the WTO. “I got confirmation from all stakeholders this will not happen,” said Lange, who was in Washington to talk with officials from USTR, Congress, unions and think tanks. But, he added, “sometimes decisions in the United States are taken quite quick,” so he can't be sure that answer will be true next week.
During a hearing that House Ways and Means Committee Chairman Richard Neal, D-Mass., said was designed to test President Donald Trump's claim that the phase one agreement with China is a “tremendous win for the American people,” most of what was revealed was that Democrats are skeptical of the purchase promises and likelihood of success of further negotiations, and Republicans admire Trump's confrontation of China.
Six Democratic senators recently sent a letter that calls for suspending Generalized System of Preferences program benefits if labor rights violations are found in the Philippines. The senators also oppose a free trade agreement with the Philippines. This letter, sent Feb. 11, follows a letter from House Democrats in 2018 that also argued that the Philippines is not the right target for a free trade deal, given the human rights violations there (see: 1809050040). “We are gravely concerned that our trade policy could be mistaken for condoning the labor and human rights violations perpetrated by President Duterte,” wrote Sens. Sherrod Brown, D-Ohio; Debbie Stabenow, D-Mich.; Ron Wyden, D-Ore; Robert Menendez, D-N.J.; Ben Cardin, D-Md., and Bob Casey, D-Pa. They asked for an out-of-cycle review for GSP eligibility over human rights and labor rights, and for a quick suspension from the program if violations are substantiated.
Senate Finance Committee Chairman Chuck Grassley, R-Iowa, said he doesn't expect the U.S. to negotiate over the tariffs it has put on European goods like Airbus planes, Scotch whiskey, French wine, and Spanish wine and olive oil until the World Trade Organization rules on Boeing subsidies. Currently, there are 10% tariffs on Airbus planes and 25% tariffs on the wine, liquor and food items; the aircraft tariff is set to climb to 15% on March 18. The Boeing ruling is not expected for several months.
A pro-free trade think tank in Canada published an analysis of the new NAFTA, known as CUSMA in Canada, and finds it lacking. “CUSMA has little traditional tariff liberalization, introducing only minor changes to market access compared to the NAFTA, and limited improvements in trade facilitation, while at the same time introducing a number of features that promise to be more restrictive of trade,” wrote the authors of the C.D. Howe Institute paper.
While a small deal could be announced during President Donald Trump's trip early next week to India, senior White House officials say that will be purchase announcements, not a full or partial restoration of India to the Generalized System of Preferences benefits program. While they declined to go into specifics on what the sticking points have been in talks on improving market access, they noted that the complaints of U.S. exporters are well known.