The European Council approved a negotiating mandate for trade talks with the U.S., but says it will not finish a free-trade agreement until the steel and aluminum tariffs on its member countries are lifted. The mandate, which was approved April 15, excludes agricultural trade from the talks.
Now that the World Trade Organization has ruled that Russia was justified in blocking transit of Ukrainian goods across its territory under the General Agreement on Tariffs and Trade's national security exception, lawyers are trying to project how a different panel will view the U.S. use of the same rationale for its steel and aluminum tariffs.
The U.S. says the World Trade Organization is hobbled and Roberto Azevedo, the director general of the WTO, said the conversations around reform are gaining momentum. "I think we have a once-in-a-generation opportunity to renew the trading system," he said at a speech April 11 at the Peterson Institute for International Economics. "Inaction would compromise the relevance or even the existence of the system as we know it." Among the U.S. complaints about the international body are that the WTO's rules are inadequate for dealing with China's myriad subsidies and that countries can self-designate as developing countries, thereby avoiding concessions in negotiations.
Toyota does support the renegotiated NAFTA, a top executive said at a trade conference in Washington, even though it will require the company to change some of its sourcing to meet the new 75 percent autos rule of origin. Doug Murtha, vice president of corporate strategy and planning for Toyota's North American division, said that the addition of $3 billion in U.S investments were, "to some extent, changes we had to make for USMCA."
Senate Finance Committee Chairman Chuck Grassley, R-Iowa, told reporters that if President Donald Trump were to hike tariffs in violation of what was negotiated in the U.S.-Mexico-Canada Agreement, as he threatened to do, it could blow up the treaty. "More tariffs would create more problems," Grassley said April 10, and he noted the steel and aluminum tariffs are already a major obstacle. "The Congress of the United States won’t bring up that agreement until the tariffs are off," he said.
The sole U.S. producer of titanium sponge, TIMET, argued to the Commerce Department that two Japanese companies and TIMET should be given a price advantage and that all other countries' producers should be restricted through quotas or tariffs that are not subject to drawback. TIMET, which failed to win an antidumping case because the International Trade Commission said its production was not in direct competition with imports used by other U.S. processors, is asking for a preference pricing scheme, similar to those used in suspension agreements for antidumping cases.
The Office of the U.S. Trade Representative's proposal to tariff up to $11 billion worth of goods from the EU as part of a long-running dispute over aircraft subsidies (see 1904090031) adds some new tension to an already fraught trade relationship. Although the trade dispute resolution that the U.S. is asking for pertains to large commercial airplanes, it goes far beyond aerospace, hitting cheeses and other food, wine, clothing and building materials. “This case has been in litigation for 14 years, and the time has come for action. The Administration is preparing to respond immediately when the WTO issues its finding on the value of U.S. countermeasures,” USTR Robert Lighthizer said in a news release.
The European Union and the U.S. have not formally begun the trade talks first agreed to last July, as the 28-member bloc still does not have a mandate to negotiate. Given that, many observers are doubtful negotiations could make substantial progress this year.
The following lawsuits were filed at the Court of International Trade during the week of April 1-7:
International Trade Today is providing readers with some of the top stories for April 1-5 in case they were missed.