Economics Professor Mary Lovely, who studies multinationals' operations in China, told the U.S.-China Economic and Security Review Commission that the trade war didn't make the U.S. less reliant on China, and that export controls designed to isolate China have not been effective, either. She noted that China is still the top exporter to the U.S., and their goods make up 17% of U.S. imports. The Commission met online Jan. 28.
Export Compliance Daily is providing readers with the top stories for Jan. 19-22 in case you missed them. You can find any article by searching on the title or by clicking on the hyperlinked reference number.
The additional Section 301 tariffs on goods from the European Union announced late Dec. 30 (see 2012300062) will take effect “with respect to products that are entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. Eastern Standard Time on January 12, 2021,” the Office of the U.S. Trade Representative said in a notice. USTR said in a Dec. 30 news release that it would increase the tariffs as part of the ongoing World Trade Organization dispute over Airbus subsidies. The announcement disrupts settlement talks and “exceeds the amount of retaliation authorised by the WTO,” a European Commission spokesperson emailed. “The Commission is analysing the data in detail and will look at all options available on how to respond.”
Witnesses overwhelmingly argued against tariffs on Vietnamese imports, during a virtual hearing Dec. 29 hosted by the Office of the U.S. Trade Representative, with numerous business representatives saying it was the choice not to sign the Trans-Pacific Partnership, not any kind of currency issue, that makes it harder for U.S. exports to penetrate Vietnam. Trade groups representing importers from Vietnam noted that their members moved sourcing from China to Vietnam precisely to avoid Section 301 tariffs, and some said putting comparable tariffs on Vietnamese imports would cause companies to relocate back to China.
Senate Finance Committee Chairman Chuck Grassley, R-Iowa, said that he hopes that a technical fixes bill for USMCA can pass this month, but its passage is hung up on whether goods manufactured in foreign-trade zones should be able to benefit from USMCA if those goods meet the rules of origin.
Export Compliance Daily is providing readers with the top stories for Nov. 30-Dec. 4 in case you missed them. You can find any article by searching on the title or by clicking on the hyperlinked reference number.
House Ways and Means Committee member Stephanie Murphy, D-Fla., said that although “the politics of trade are fairly tricky,” she feels confident in saying “things can't get any worse” for free trade during the Biden administration. Murphy, one of two members of the House speaking on a Cato Institute webinar about what to expect in trade with a new president, said she's encouraged by President-elect Joe Biden's choices for the secretaries of the treasury and state, and the head of the National Security Council, because all of the individuals recognize that trade is an important tool in foreign policy.
The European Union's equivalent of secretary of state is calling for coordination with the U.S. on regulatory conformity, choosing a new director-general at the World Trade Organization and restoring the appellate body there, in a policy paper released Dec. 2. High Representative of the Union for Foreign Affairs and Security Policy Josep Borrell Fontelles said they need to intensify trilateral work between the EU, Japan and the U.S. on how to address market-distorting practices that WTO rules aren't effective in addressing. “We should also work together to bring forward the WTO e-commerce negotiations,” he said.
President-elect Joe Biden won't remove Section 301 tariffs until he makes a full review of the phase 1 agreement and consults with Japan, South Korea and Europe “so we can develop a coherent strategy,” New York Times columnist Thomas Friedman reported Dec. 2. Biden said free-market countries need more leverage to “actually produce progress on China’s abusive practices,” such as illegal subsidies to corporations, forced tech transfers and stealing intellectual property.
Antony Blinken, President-elect Joe Biden's choice for secretary of state, has said that the Section 301 tariffs on China and Section 232 tariffs on Europe “harm our own people,” according to coverage of a U.S. Chamber of Commerce talk he gave in September. “We would use tariffs when they’re needed, but backed by a strategy and a plan,” he added. Blinken, who served as deputy secretary of state under President Barack Obama, said, “The EU is the largest market in the world. We need to improve our economic relations, and we need to bring to an end an artificial trade war that the Trump administration has started,” Reuters reported from the Chamber talk.