USTR Boosting Enforcement, Continues Ag Market Access Fight in TPP, Says Froman
The U.S. is continuing to ramp up trade enforcement efforts with foreign partners, following the recent World Trade Organization (WTO) determination that Chinese export restraints on two rare earth metals, tungsten and molybdenum, violate WTO agreements, said U.S. Trade Representative Michael Froman at an April 3 hearing before the House Ways and Means Committee. The U.S. will continue to pursue enforcement actions in the future, while increasing application of trade remedy laws, said Froman. The WTO issued the rare earths decision on March 26 (see 14032613).
Sign up for a free preview to unlock the rest of this article
If your job depends on informed compliance, you need International Trade Today. Delivered every business day and available any time online, only International Trade Today helps you stay current on the increasingly complex international trade regulatory environment.
“The Obama administration has also placed an unprecedented emphasis on trade enforcement. Since 2009, the Administration has filed 17 WTO complaints, and doubled the rate of cases filed against China,” said Froman. “Through our ongoing enforcement agenda, we are leveling the playing field for key agricultural producers in Wisconsin, Georgia, and Oregon, aircraft workers in Kansas and Washington State, and manufacturers of wind turbines in Ohio and hi-tech batteries in Michigan.” The administration should further scrutinize alleged South Korean illegal dumping of steel products in the U.S. market, said Rep. Richard Neal, D-Mass., claiming the Commerce Department is considering filing a complaint.
Aside from trade enforcement, the U.S. is moving ahead with Trans-Pacific Partnership and Transatlantic Trade and Investment Partnership negotiations, said Froman, but the TPP pact continues to be hindered by Japanese reluctance to make adequate market access and regulatory concessions. TPP partners are all waiting for Japan to make the sufficient market access liberalization, said Froman.
Multiple lawmakers expressed concern over Japan’s inclusion in the agreement. “Japan’s decision to limit or exclude a significant number of agricultural products is becoming a serious impediment to the agreement,” said Ways and Means Committee Chairman Dave Camp, R-Mich. “It’s also giving countries like Canada an excuse to not open up their markets, so adequately addressing our bilateral auto issues with Japan is critical to my support. If a country is not ready to make commitments to join TPP as an ambitious, high-standards agreement, then we should complete TPP without that country and allow them to join later if and when they are ready to make the necessary commitments.” The TPP pact should implement comprehensive agricultural market access among participants, complimented by a strong sanitary and phytosanitary measures, said Pat Tiberi, R-Ohio.
The Trade Promotion Authority (TPA) bill is necessary to secure both agreements, regardless of Japanese concessions, said Camp, who co-introduced the legislation in January. Froman said the administration supports TPA legislation with broad bipartisan support, but notably declined to endorse the legislation introduction by Camp. The introduction generated widespread opposition among Democrats, including Ways and Mean ranking member Sandy Levin, D-Mich. (see 14011013). Camp’s TPA bill needs to provide more guidance in several areas, said Levin. "For example, on currency manipulation, it provides no real guidance, instead leaving it to the administration to determine what is ‘appropriate,’” he said. “And the bill provides little guidance in determining what an acceptable outcome is with Japan on automotive or agricultural access.”
The Obama administration continues to help boost U.S. agricultural exports, which reached a record $148.4 billion in 2013, said Froman. The administration also aims to strengthen U.S. manufacturing policies and capacity, said Froman.
The Office of the USTR, however, is routinely distorting trade data to illustrate trade deficit decreases and export boosts specifically, said Public Citizen in an April 2 release before Froman testified. The Public Citizen statement rebuts USTR assertions of surpluses in NAFTA and the U.S.-South Korea FTA, while claiming the negative economic and employment impacts of the agreements are amplifying congressional rejection of TPA as a means to secure TPP.
“USTR’s primary data distortion is the decision not to use the official U.S. government trade data provided by the U.S. International Trade Commission. Instead, USTR cites data that include what are called ‘re-exports.’ These are goods made abroad that are simply shipped through the United States en route to a final destination,” said Public Citizen. “Each month, USITC removes re-exports, which do not support U.S. production jobs, from the raw data gathered by the Census Bureau. But USTR uses the uncorrected data, inflating the actual U.S. export figures.” -- Brian Dabbs