On The Hill

 

The Trump administration announced on Wednesday (Aug. 12) it was making changes to its list of $7.5 billion worth of European Union products facing retaliatory duties.

 

The Office of the U.S. Trade Representative (USTR) received 24,000 comments on the prospective changes.

 

Tariffs on non-aircraft materials will remain at 25 percent and some aircraft materials will continue to be subject to 15 percent tariffs. USTR was considering $3.1 billion in European goods that were not yet subject to retaliatory tariffs. Olives are included in the updated tariff list, but gin, vodka, and chocolate were excluded.^[1]

 

The U.S. removed tariffs on certain goods, including Greek and German cheeses, but also put new duties on products, including jams from France and Germany. The changed targets pleased some countries and upset others.

 

The European Commission welcomed the administration’s decision not to escalate the trade war.

 

“The Commission acknowledges the decision of the U.S. not to exacerbate the ongoing aircraft dispute by increasing tariffs on European products,” a spokesperson said Thursday (Aug. 13).^[2]

 

To view USTR’s press release, click here.

 

To view the Federal Register notice, click here.

 

 

 

On Thursday (Aug. 13), the Department of Commerce proposed changes to regulations that guide antidumping and countervailing (AD/CVD) duty enforcement. The move will boost the agency’s ability to address circumvention and the effectiveness of trade remedy proceedings.

 

The agency suggested in the proposed rule a variety of changes to address alleged “abuse” of shipper reviews, scope inquiry procedures, circumvention inquiries, and certification of entries.^[3]

 

Stronger trade enforcement has been a tenant of the Trump administration’s trade goals.

 

“Since the beginning, President Trump and his administration have remained steadfast in defending the interests of American workers and the vigorous enforcement of our trade remedy laws, so those who take risks, innovate, create new products or toil on the farm receive all the protection from unfair trade to which they are entitled,” Commerce Secretary Wilbur Ross said in a statement.

 

“The regulations being proposed today reaffirm our commitment,” he added.

 

Commerce has requested public comments on the proposed changes, all of which are due Sep. 14, 2020.

 

To view a press release, click here.

 

To view the proposed rule, click here.

 

 

 

On Wednesday (Aug. 12), British Trade Secretary Liz Truss said the U.S. and U.K. will exchange its first market-access offers between now and the next round of negotiations in early September. She also praised the continued “positive progress” in the talks.^[4]

 

The trade talks will likely continue throughout the presidential election season.^[5]

 

Truss worked with USTR Robert Lighthizer to review progress on the talks and layout plans for negotiations. The third round of talks was held over two weeks starting Jul. 27 and saw a total of 33 sessions on 21 different areas of negotiations.

 

Additionally, Truss pushed Lighthizer for the “immediate removal” of retaliatory tariffs on British goods. However, Ligthizer has resisted a negotiated resolution in the long-running WTO dispute over Airbus subsidies.

 

To view the U.K.’s statement on the third round of talks with the U.S., click here.

 

 

 

On Tuesday (Aug. 11), former Vice President and presumptive Democratic presidential nominee Joe Biden selected Sen. Kamala Harris (D-CA) to be his running mate. The two share goals including, raising corporate taxes and expanding health insurance, but disagreed during the 2020 Democratic primary campaign on how to approach various policy areas, including trade.

 

Harris opposed two recent trade deals that Biden supported; the U.S.-Mexico-Canada Agreement (USMCA) and the Trans-Pacific Partnership (TPP). She noted the environmental provisions in the USMCA as “insufficient.” Harris also said labor and environmental concerns were the prime reasons she did not support the TPP.^[6]

 

Both Harris and Biden agree on the need for an international alliance to confront China, and have criticized the Trump administration’s approach.

 

 

 

As the U.S. is preparing for high-level consultations with China over the Phase One deal, Trump said on Wednesday (Aug. 12) that recent purchases of agricultural products could be designed to change his attitude toward Beijing.

 

“They are giving the Midwest, our farmers, among the largest orders they’ve ever seen,” Trump told reporters at the White House, adding that Lighthizer said “about 40 percent of what they’re selling now is going to China.”^[7]

 

Thus far, China has fallen short of its promised purchases in the Phase One deal. Recently, tensions between the U.S. and China have been heightened over issues such as TikTok and Hong Kong.

 

On Friday (Aug. 14), former top White House trade negotiator Clete Willems said the deal is about more than just buying more American goods.

 

“There is a whole structural side to this deal and on the structural components, whether it comes to intellectual property, financial services, market access and having China change some of its laws on agriculture, China is more or less, doing what it said it was going to do,” Willems said.^[8]

 

USTR Lighthizer and Chinese Vice Premier Liu He are expected to meet in a video conference on Saturday (Aug. 15) to review the Phase One trade deal.

 

 

 

On Wednesday (Aug. 12), Taiwanese President Tsai Ing-wen said she hopes to strike a deal with the U.S. during her second term in office. Free trade talks with Taiwan would likely increase tensions between Washington and Beijing.

 

“We must be clear-eyed on how we can move forward on an FTA. For too long, closer trade relations have been hindered by technicalities that account for just a small fraction of two-way trade,” Tsai said during a video presentation.^[9]

 

Her comments followed a recent visit by the U.S. Health and Human Services Secretary Alex Azar to Taiwan.

 

Lighthizer said earlier this month that Taiwan must fix “longstanding” trade barriers that restrict U.S. market access before it can strike a deal with the U.S.

 

 

 

On Thursday (Aug. 13), the Senate confirmed Michael Nemelka for a deputy U.S. Trade Representative (USTR) role. Nemelka, who has currently been serving as an adviser to USTR Lighthizer, will succeed C.J. Mahoney as deputy USTR for investment, services, labor, environment, Africa, China, and the Western Hemisphere. Mahoney is in line to become the State Department’s legal adviser.^[10]

 

 

 

^[1] “Alleging continued non-compliance, USTR modifies Airbus retaliation.” Inside U.S. Trade, 12 Aug. 2020. https://link.edgepilot.com/s/c9060633/qCZjSTAZRUevX0opeXEagg?u=https://insidetrade.com/daily-news/alleging-continued-non-compliance-ustr-modifies-airbus-retaliation

 

^[2] Leali, Girgio; Wax, Eddy; & Lanktree, Graham. “Europe has mixed reactions to updated U.S. tariffs over Airbus.” Politico Pro, 13 Aug. 2020. https://link.edgepilot.com/s/1aa44a3c/2IuZpo_QA0ic0U6gcOeEkg?u=https://subscriber.politicopro.com/article/2020/08/europe-has-mixed-reactions-to-updated-us-tariffs-over-airbus-1978847https://subscriber.politicopro.com/article/2020/08/europe-has-mixed-reactions-to-updated-us-tariffs-over-airbus-1978847

 

^[3] “Commerce proposes rule to bolster AD, CVD enforcement.” Inside U.S. Trade, 13 Aug. 2020. https://link.edgepilot.com/s/dfcca5c0/0A5FvAOF-k6kfHiwDwwz8g?u=https://insidetrade.com/daily-news/commerce-proposes-rule-bolster-ad-cvd-enforcement

 

^[4] “Truss: U.S., U.K., to exchange first market-access offers before next talks.” Inside U.S. Trade, 12 Aug. 2020. https://link.edgepilot.com/s/7dbb5d53/fVjsixX2N0atzs5iNdPnHw?u=https://insidetrade.com/daily-news/truss-us-uk-exchange-first-market-access-offers-next-talks

 

^[5] Lanktree, Graham. “U.K., U.S. plan trade talks through American election season.” Politico Pro, 12 Aug. 2020. https://link.edgepilot.com/s/280fd2c0/hPOUu4_A0kmDjaowYqaJdg?u=https://subscriber.politicopro.com/article/2020/08/uk-us-plan-trade-talks-through-american-election-season-3983310

 

^[6] Collins, Eliza. “Kamala Harris, Biden DIffered on Trade, Medicare for All. Here’s a Guide to Their Positions.” The Wall Street Journal, 12 Aug. 2020. https://link.edgepilot.com/s/f80cbcdd/Fm1NAT-BuEW867A8uL8vYQ?u=https://www.wsj.com/articles/kamala-harris-biden-differed-on-trade-medicare-for-all-heres-a-guide-to-their-positions-11597259611

 

^[7] “Trump: Chinese ag purchases may be attempts to ‘make me change my mind.” Inside U.S. Trade, 13 Aug. 2020. https://link.edgepilot.com/s/b2d6e9b6/sGYZJvEOIkabZH6jR9V_cA?u=https://insidetrade.com/daily-news/trump-chinese-ag-purchases-may-be-attempts-make-me-change-my-mind

 

^[8] Tan, Huileng. “China’s purchases are ‘lacking’ but the U.S. is still ‘happy’ with trade deal, ex-White House negotiator says.” CNBC, 14 Aug. 2020. https://link.edgepilot.com/s/e0a6f439/7jHvo02xU02lYi0d53pLkA?u=https://www.cnbc.com/2020/08/14/us-china-trade-deal-is-not-just-about-purchases-former-white-house-trade-negotiator.html

 

^[9] “Taiwan’s president hopes for trade deal with the U.S.” Inside U.S. Trade, 12 Aug. 2020. https://link.edgepilot.com/s/c8466d76/oRerObBmG0CStHNzgZoIyQ?u=https://insidetrade.com/trade/taiwans-president-hopes-trade-deal-us 

 

^[10] “Senate confirms Nemlka to succeed Mahoney as deputy USTR.” Inside U.S. Trade, 13 Aug. 2020. https://link.edgepilot.com/s/c2cf4cd6/b788sqiItEajZaRkgj-ozg?u=https://insidetrade.com/trade/senate-confirms-nemelka-succeed-mahoney-deputy-ustr