The U.S. Chamber of Commerce, in an updated list of its priorities for a U.S.-United Kingdom free trade agreement, said it wants a “single, comprehensive agreement,” not a phased approach that resolves just “a subset of issues.” The Chamber released its list the same day negotiations began (see 2005050014) May 5. It wants the U.S. and the U.K. to eliminate all tariffs on industrial goods, to address non-tariff barriers in industrial goods, and for the U.K. to end what the Chamber calls “non-science-based restrictions on agricultural trade.” The Chamber also is calling for the administration to promptly remove Section 232 tariffs on British steel and aluminum.
The European Union will increase its safeguard measures on U.S. goods in retaliation for new Section 232 tariffs on steel and aluminum “derivatives” imposed in February, the EU said in a notice published in the April 7 Official Journal. Effective May 8, an additional 20% tariff will be imposed on U.S. lighters (other than pocket lighters) under EU Combined Nomenclature subheading 9613.80.00, and an additional 7% tariff on plastic fittings for furniture and coachwork of CN subheading 3926.30.00, the EU said.
The Commerce Department is “pushing forward” on increased restrictions of foreign exports to Huawei that contain U.S. content, Secretary Wilbur Ross said during a March 5 Senate hearing. Sen. Chris Van Hollen, D-Md., told Ross he hopes Commerce follows through with the restrictions -- which would include changes to the de minimis rule and the Direct Product Rule (see 2002050047) -- adding that Commerce has been “appropriately aggressive” in pursuing more stringent controls on technology exports to Huawei and China. But Van Hollen noted that Commerce has faced pushback from other parts of the Trump administration, including the Defense and the Treasury Departments (see 2001240012).
Commerce Department Deputy Chief of Staff and Policy Director Earl Comstock is leaving the department, Commerce Secretary Wilbur Ross said March 2 in a news release. Comstock was reportedly heavily involved in the export restrictions on Huawei Technologies and the Section 232 investigations.
The United Kingdom government emphasized that its National Health Service will not pay more for drugs as a result of a U.S.-United Kingdom free trade deal, and that Britain “will not compromise on our high environmental protection, animal welfare and food standards.” The latter seems to be a reference to sanitary standards that frustrate U.S. exporters, such as a ban on anti-bacterial washes of chicken. The government issued its negotiating objectives and an analysis of the economic benefit to the U.K. of a free trade deal in the March 2 document.
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.
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.
The Commerce Department Bureau of Industry and Security asked for an 8% boost in funding for the 2021 fiscal year to increase export control compliance and enforcement, bolster initiatives to counter China, and to better identify emerging and foundational technologies. BIS’s request for a $10 million budget increase, submitted to Congress last week, comes as the agency plans to roll out a series of export controls on sensitive technologies (see 1912160032), which will increase its involvement in the Trump administration's effort to sustain the U.S.'s technological advantage over China. BIS specifically asked for just over $1 million and five new positions to help it control emerging and foundational technologies and enforce those controls.
The U.S.-Japan mini-trade deal covers just 5 percent of trade between the partners, according to Bruce Hirsh, a principal at Tailwind, but he said the likelihood of further progress is small. Hirsh spoke while at the National Association of Foreign-Trade Zones legislative summit on Feb. 11. “Japan wasn’t interested in doing a bilateral deal at all, but they recognized there was only so long they could keep the U.S. at bay,” he said. He said that what Japan gave to the U.S. “fell a little bit short of TPP,” or the Trans-Pacific Partnership. He said beef and pork got TPP parity, but rice got nothing and “dairy got a lot, but not everything.”
Customs duties are estimated at $72 billion in the current fiscal year, and the White House projects that number will climb to $92 billion in the fiscal year that begins Oct. 1. It projects that duties then will fall to $54 billion the following year.