On The Hill

Trade Update (April 8)

Apr 8, 2019 | SHARE  
US-Mexico-Canada Agreement (USMCA)


Senate Finance Committee Chairman Chuck Grassley (R-IA) continues to call on President Trump “to promptly remove Section 232 tariffs on steel and aluminum imports from Canada and Mexico.”[1]


In a speech to the United Steelworkers Canadian National Policy Conference, ALF-CIO President Richard Trumka called for a better deal that benefits working people. “In its current form, the new NAFTA does not meet these straightforward standards,” such as addressing outsourcing, a lack of enforcement measures, and the increase of Canada’s drug monopoly period from eight to ten years.[2]


In the United States, House Speaker Nancy Pelosi (D-CA-12) continues to press President Trump to reopen negotiations to tighten enforcement provisions in the agreement. At an event in Washington on Tuesday she said, “No enforcement, no treaty,” when asked about the administration’s top trade priority. Speaker Pelosi said she would not bring the agreement for a floor vote until Mexico approves its promised labor reforms.


Mexico had until January 1, 2019 to pass legislation strengthening workers’ collective bargaining rights, providing free and fair union elections, and establishing independent labor courts. Despite Mexican President Andrés Manuel López Obrador’s support of labor reforms, the legislation has not been passed, but Mexican officials predict passage by the end of April.[3] Reps. Bill Pascrell (D-NJ-09) and Rosa DeLauro (D-CT-03) circulated a Dear Colleague this week that touches on many of these USMCA issues, which they hope to send to US Trade Representative Robert Lighthizer next week.


Despite Democratic pressure, the administration does not want to reopen negotiations, and neither do Canadian or Mexican officials. On the sidelines of a North American Treaty Organization (NATO) meeting in Washington, D.C., Canadian Foreign Minister Chrystia Freeland told reporters in “Canada’s view, we’ve done our deal.” She cautioned that reopening negotiations would be a “Pandora’s box,” because compromises were made on all sides. Freeland also reiterated that Canada would not move forward with ratification as long as the US maintained tariffs on Canadian steel and aluminum.[4]



US-China Trade Negotiations


Chinese President Xi Jinping and US President Donald Trump met in Washington, DC for bilateral trade talks on Thursday (April 4). Before the meeting, President Trump praised China for reclassifying fentanyl and criminalizing sales of the drug. Both presidents touted the rapid progress of the discussions and in concert, US Trade Representative Robert Lighthizer said, “We have a great partner in the Vice Premier…his commitment to reform in China is the reason that this has a chance…There are still some major, major issues left, but we’re certainly making more progress than we would’ve thought when we started.” The “major issues” include intellectual property protection and theft and tariffs. Also during the press conference, President Trump announced a US-China summit once a deal is agreed to. He hopes to announce in the next four weeks where and when the summit will take place.[5]


In late February, President Trump chose not to increase tariffs on $200 billion of Chinese exports because the two countries were making significant progress in trade negotiations.[6] In December, after the trade truce was negotiated between the US and China, China agreed to suspend the additional 25% tariffs on US-made cars and auto parts until April 1. This Saturday (March 30), in a similar show of good faith, China’s State Council announced it would continue its suspension of tariffs on US cars and auto parts. It has not yet been announced when the suspension would end.[7]



US International Trade Commission (ITC) Determination in Large Diameter Welded Pipe


On Tuesday (April 2), USITC announced injury determinations in the antidumping (AD) and countervailing duty (CVD) investigations into large diameter welded (LDW) pipe from Canada, Greece, Korea, and Turkey. The Commissioners will issue:

·     AD duty orders on imports of LDW carbon and alloy steel line pipe from Canada, Greece, Korea, and Turkey

·     CVD order on imports of LDW carbon and alloy steel line pipe from Korea

·     AD orders on imports of LDW carbon and alloy steel structural pipe from Canada, Korea, and Turkey

·     CVD order on imports of LDW carbon and alloy steel structural pipe from Korea and Turkey[8]





[1] Sen. Grassley Press (@GrassleyPress). “I’m calling on the Administration–.” 1 Apr 2019, 4:10pm.



[2] Richard L. Trumka. “Trumka: New NAFTA Not Good Enough.” AFL-CIO.org. 2 Apr 2019. https://aflcio.org/speeches/trumka-new-nafta-not-good-enough


[3] David J. Lynch. “Pelosi demands changes to Trump’s trade deal with Mexico, Canada.” The Washington Post. 2 Apr 2019. https://www.washingtonpost.com/business/economy/pelosi-demands-changes-to-trumps-trade-deal-with-mexico-canada/2019/04/02/009874ca-556f-11e9-814f-e2f46684196e_story.html?utm_term=.331e61e9d2e1


[4] David Ljunggren. “Canada says reopening USMCA trade pact coutd be a “Pandora’s box.” Reuters.com. 4 Apr 2019. https://www.reuters.com/article/us-usa-trade-canada/canada-says-reopening-usmca-trade-pact-could-be-a-pandoras-box-idUSKCN1RG2BU


[5] “Remarks by President Trump and Vice Premier Liu He of the People’s Republic of China Before Bilateral Meeting.” WhiteHouse.gov. 4 Apr 2019. https://www.whitehouse.gov/briefings-statements/remarks-president-trump-vice-premier-liu-peoples-republic-china-bilateral-meeting/


[6] Donna Borak. “US ditches China tariff hike ‘until further notice.’ CNN Business, cnn.com. 28 Feb 2019. https://www.cnn.com/2019/02/28/business/us-china-trade-war-tariffs/index.html


[7] Reuters. “China will continue to suspend extra tariffs on US vehicles, auto parts.” South China Morning Post, scmp.com. 1 Apr 2019. https://www.scmp.com/news/china/politics/article/3004051/china-will-continue-suspend-extra-tariffs-us-vehicles-auto


[8] “USITC Makes Determinations Concerning Large Diameter Welded Pipe From Canada, Greece, Korea, and Turkey.” USITC.gov. 2 Apr 2019. https://www.usitc.gov/press_room/news_release/2019/er0402ll1073.htm



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