Exporters, Foreign Governments, US Chambers Abroad Argue About What Reciprocal Means
Among more than 700 submissions to the Office of the U.S. Trade Representative -- as the administration seeks to quantify the cost to American exporters and producers of trade barriers and unfair subsidies -- were just over a dozen from trade groups representing foreign companies, American chambers of commerce specific to foreign markets, and foreign governments.
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.
A few of the American chambers merely laid out trade barriers they face in the country they sell to, but most of these comments -- unlike dozens from American agricultural and manufacturing interests -- said that tariffs are not the answer to removing the barriers.
Only Canada's and Brazil's governments made submissions -- not Mexico, the European Union, China, Vietnam or the U.K. -- but those submissions were lengthy and directly responded to Trump's complaints about trade deficits, value-added taxes, tariffs on specific U.S. products, and other market access concerns he's posted about.
The last comments were posted March 12; comments closed on March 11.
The Government of Canada noted that USMCA provides duty-free access for more than 98% of tariff lines, and that 99.9% of two-way trade is duty free.
"Both countries granted preferential duty-free access to a small number of sensitive agricultural products through commercially meaningful tariff rate quotas: Canada for 1.3% of tariff lines covering dairy, poultry, and eggs, and the United States for 1.5% of tariff lines covering dairy products, sugar, sugar-containing products, and chocolate," the government wrote.
It noted that U.S. data shows a $64 billion goods trade deficit with Canada in 2024, but that's only 5% of the global trade deficit the U.S. has. That deficit "is driven entirely by energy products," the submission said. Excluding oil, gas and other petroleum products, it's Canada that has the goods deficit -- $34 billion last year.
"The United States also has a manufacturing trade surplus with Canada that topped $23.7 billion in 2024 -- Canada was the only top 5 trading partner with whom the United States ran a trade surplus in manufacturing," the submission said. "The United States transforms the vast majority of products it buys from Canada into higher-valued 'Made in the USA' goods. Over seventy per cent of Canadian goods exports to the United States are used in the production of other goods."
The submission noted, in bold: "Canada buys more U.S. goods than China, Japan, and Germany combined."
Canada also noted that the U.S. has a nearly $35 billion services trade surplus with Canada, including financial services, travel, and university enrollment.
The submission addressed several of Trump's complaints (though not lumber), in turn -- access for banks, the digital services tax, and the value-added tax, or VAT.
It noted that 16 U.S. banks operate in Canada, and said its DST does not target American firms.
On dairy, "In the USMCA, Canada and the United States successfully negotiated significant market access into each other’s dairy markets, with the benefits of this outcome accruing overwhelmingly in favour of the United States. Since the coming into force of the USMCA, U.S. dairy exports to Canada have grown from $728 million to $1.14 billion annually," the submission said.
It explained that VATs are trade neutral, and that buyers in the U.S. may claim a refund of the VAT paid on inputs, not just Canadian exporters. It said that 45 U.S. states levy sales taxes, which are similar to Canada's national sales tax.
The VAT "applies to imported goods in the same way as it applies to goods and services supplied in Canada," the submission noted. And while there is no VAT for goods that are being exported, U.S. buyers in states with sales taxes pay those taxes on Canadian imports.
On steel, Canada noted it bought $5.5 billion in U.S. steel last year, 37% of U.S. exports. "Virtually all, 96%, of U.S. steel imports from Canada contain steel melted and poured in North America," the submission said.
On aluminum, Canada said that its primary aluminum exports are used by more than 500,000 workers who are processing that aluminum into parts, components and products. They also noted that the U.S. aluminum industry trade group did not want 25% tariffs on Canadian aluminum, as it recognizes how reliant it is on Canadian stock.
"The U.S. industry is also highly reliant on scrap aluminum -- and particularly on primary scrap aluminum, of which Canada is the primary source," the submission said.
Moreover, Canada noted that it imported $3.2 billion in aluminum and aluminum products from the U.S., 22% of U.S. aluminum exports.
The Business Council of Canada wrote that Canada has no unfair trading practices that are harming the U.S., as defined by the U.S. Trade Representative, at least it didn't, until it imposed retaliatory tariffs for U.S. tariffs.
The Government of Brazil wrote in bold that Brazil has the 7th largest trade surplus in goods, at $7.4 billion in 2024, nearly 32% larger than in 2023.
"If we consider goods and services, the U.S. trade surplus with Brazil exceeded USD 29 billion," the country wrote.
The government noted that the U.S. had a trade surplus of $1.8 billion in autos and auto parts, and that "the U.S. exports metallurgical coal to Brazil, where this input is used to produce semi-finished steel."
It responded to the accusation that Brazil is a prime example of non-reciprocal trade with its 18% tariff on ethanol, while the U.S. has a 2.5% tariff -- an example given in the White House fact sheet on its efforts to gain reciprocal trade.
Brazil said that it produces ethanol from sugarcane. "In the same sugar and alcohol sector, while the tariff on sugar imports in Brazil is 7%, the United States maintains a tariff of US$ 340 per ton (equivalent to a rate of approximately 80%), which penalizes Brazilian exports of the product to the United States. For the record, Brazil does not apply any tariff equivalent to an 80% duty."
The government said it understands the U.S. wants to promote domestic job creation -- it does, too.
"Brazil urges the United States to prioritize dialogue and cooperation over the imposition of unilateral trade restrictions, which risks fueling a downward spiral of measures that could severely jeopardize our mutually beneficial trade relationship," the submission said.
AmCham Brazil also defended Brazil, noting it's one of the few G20 countries that the U.S. has a trade surplus with.
"More than 70% of the value of US exports to Brazil receive duty-free treatment. The average tariff rate applied by Brazil to US goods (2.7%) is lower than the rate it applies to the rest of the world (5.2%)," the chamber wrote.
It also defended the VAT, saying it's levied equally on domestic goods and imports.
It also provided a chart of the top U.S. exports to Brazil -- first was oil, second was aerospace engines and engine parts, and third is coal.
The Council of the Americas, a trade group of more than 200 companies that do business in Latin America, argued that U.S. interests are for efficient supply chains, meeting the strategic challenge of China, secure borders, controlled migration and low inflation.
"It will be difficult to achieve the elements of this agenda without the active cooperation of our neighbors to address them effectively. Cooperation is more likely to be sustained over time when it is offered willingly on the basis of mutual reward rather than coerced, which can breed resentment and a search for alternatives," the council wrote.
It also argued that "increased tariffs are a tax on ourselves which should be used sparingly, with every effort made to avoid trade wars which debilitate the U.S. economy and corrode our strategic alliances. They are ineffective in establishing reciprocal terms of trade with multi-faceted imbalances. To the extent they are used as a tool to address unfair practices, they should be targeted, proportionate, and short."
However, the group did lay out some trade irritants, without putting a dollar figure on them, including described barriers in telecommunications, a taxation difference for drivers using a Chinese ride sharing app vs. Uber, and credit cards.
AmCham Australia pointed out that the U.S. has a $17.9 billion surplus with Australia, and said all U.S. goods enter Australia without tariffs.
American Chamber of Commerce in Japan said that Japan's market has opened to foreign companies in recent decades, but complained that Japan's pricing for biologics "systematically undervalue U.S. innovation," and that patented medicines face repeated price cuts.
"The recently passed Smartphone Software Competition Promotion Act unfairly targets U.S. technology companies while excluding domestic and Chinese competitors," the chamber complained.
In autos, it said clean energy vehicle incentives disproportionately favor domestic manufacturers (the U.S. credits also favor domestic production of EVs). "The partial and selective acceptance of U.S. Federal Motor Vehicle Safety Standards imposes unnecessary costs and restricts market access for American automakers," the chamber wrote.
It complained that "unequal customs procedures favoring Japan Post over private express carriers continue to create an uneven playing field despite past commitments to reform."
In fragrances and cosmetics, "stringent advertising restrictions and excessive product registration requirements for medicated cosmetics place undue burdens on U.S. cosmetic companies, limiting their competitiveness."
The Chamber did not say whether it believes tariffs would be effective in removing these irritants.
Keidanren, the Japanese Business Federation, noted that Japanese firms with U.S. subsidiaries support about 1 million jobs in the U.S.
"We urge full consideration of the mutually complementary and strategically vital nature of U.S.-Japan economic relations. This partnership extends beyond trade statistics to include broader security and geopolitical considerations, which should be reflected in future trade policies," the federation wrote.
AmCham Hanoi said explicitly that the trade deficit the U.S. has with Vietnam doesn't justify tariffs.
"While the U.S. trade deficit with Vietnam has grown markedly in recent years, the cause of this growth appears to be driven by a good investment climate, and relocation and reassessment of supply chain security and sourcing operations from China to Vietnam and other countries. We urge the Administration to consider this deficit trend as evidence of President Trump’s success during his first term in diversifying supply chains in the Indo-Pacific region," the group wrote.
The U.S.-ASEAN Business Council asked the U.S. to engage more with Southeast Asia in trade and investment, rather than disrupting the commercial interests of American companies operating in those countries.
It did list 14 trade barriers, but said, "none of these non-tariff issues U.S. companies face in Southeast Asia rise to the level of warranting reciprocal tariffs by the United States."
The China Chamber of Commerce of Import and Export of Foodstuffs and Native Produce and Animal By-products wrote that China has been reducing its import tariffs, and its average is now about 7.3%, down from 9.8% it promised when it joined the World Trade Organization.
The chamber said that in 2024, China imported $27.5 billion worth of agricultural products from the U.S., down 16% from the year before. It noted that during the 2018 trade friction between the two countries, soybean exports fell by almost 50%, and reminded the administration that China has put 10 to 15% tariffs on ag exports in response to the 20% tariffs the U.S. has imposed on China in the last two months. "Currently, the Chinese market accounts for 51.8% of US soybean exports, 10.3% of US meat exports, and 8.7% of US wheat exports," the group wrote.
The African Coalition for Trade, which represents exporters from Kenya, Madagascar, Lesotho, Tanzania, Mauritius, and Eswatini, argued that in 2024, the U.S. had a trade surplus with more than half the countries covered by the African Growth and Opportunity Act.
"The U.S. trade in goods balance with the AGOA countries (excluding petroleum products) reached a $1.1 billion trade surplus in 2019, but the impact of the COVID-19 pandemic on trade pushed the trade balance back into deficit in 2020," the coalition wrote.
They cited estimates that AGOA imports created about 300,000 jobs in retail and transportation, and cited Commerce Department estimates that U.S. goods exports to Africa supported more than 100,000 jobs.
The Kenyan Apparel Manufacturers argued that AGOA "reduces dependency on regions that may pose risks to U.S. interests." It also said that AGOA countries provide cobalt, lithium, gold and platinum, coffee, cocoa, avocados, mangos and other tropical fruits.
It said textiles were 60% of AGOA exports, and they primarily serve price-sensitive customers at stores like Costco and Ross.