Discussions of auto rules of origin are getting more specific as NAFTA talks continue, according to Canada's Foreign Minister Chrystia Freeland, who spoke to reporters outside the headquarters of the Office of the U.S. Trade Representative on April 25. "We are starting to get into a more detailed conversation, which is absolutely necessary, given the fiendish complexity of rules of origin for cars -- and I think it's a really good thing we're starting to dig into the details," she said. Some say that the U.S. has compromised very little on its higher rules-of-origin demands (see 1804230048), as U.S. Trade Representative Robert Lighthizer is not convinced by auto companies' complaints.
Mara Lee
Mara Lee, Senior Editor, is a reporter for International Trade Today and its sister publications Export Compliance Daily and Trade Law Daily. She joined the Warren Communications News staff in early 2018, after covering health policy, Midwestern Congressional delegations, and the Connecticut economy, insurance and manufacturing sectors for the Hartford Courant, the nation’s oldest continuously published newspaper (established 1674). Before arriving in Washington D.C. to cover Congress in 2005, she worked in Ohio, where she witnessed fervent presidential campaigning every four years.
Stakeholders continue to ask for additional and enhanced ACE capabilities, and the agency is working on system enhancements to enable de minimis functionality, CBP Commissioner Kevin McAleenan told the House Homeland Security Committee Subcommittee on Border and Maritime Security in his prepared opening statement. Creating de minimis functionality "will provide CBP access to previously unavailable admissibility data for low value shipments, resulting in improved cargo processing and use of enforcement resources," he said.
Leaders of the New Democrat Coalition, who traditionally vote for free trade deals, expressed their frustration that the U.S. trade representative is not telling them what is happening in NAFTA negotiations. At a press conference April 26, Rep. Ron Kind, D-Wis., Rep. Rick Larsen, D-Wash., Rep. Kendrick Meeks, D-N.Y., and Rep. Scott Peters, D-Calif., said they need to know where NAFTA is headed. "We're getting the sense more and more" that the administration intends to bring a rewritten NAFTA as a fait accompli, Kind said. "I would suggest their tactics are wrong and they shouldn't take these votes for granted," Larsen said.
The Aluminum Association, the largest trade group for the aluminum industry, asked President Donald Trump to grant permanent exemptions to the European Union, Canada, Mexico, Brazil, Australia and Argentina -- and said those agreements should not be used to create quotas for aluminum exports. The trade group sent a letter on April 24 noting that 97 percent of aluminum industry jobs are in mid- and downstream production, and most rely on at least some imported aluminum. "Quotas would paradoxically cause imports of semi-fabricated products from China to be more competitive in the U.S. market, as manufacturers scramble to find metal," the letter said.
President Donald Trump told reporters April 24 that he wishes he could make a trade deal just with France, because trade with the European Union "has been unfair for a long time," but that his Cabinet is negotiating with the EU around the Section 232 tariffs on steel and aluminum. On NAFTA, Trump said, "NAFTA as you know is moving along. We're doing very nicely with NAFTA. We could make a deal very quickly, but I'm not sure that's in the best interest of the United States. We'll see what happens."
Treasury Secretary Steve Mnuchin will lead a delegation to China in a few days to discuss trade issues, including potential Section 301 tariffs, President Donald Trump said during a press conference April 24. Mnuchin, joined by U.S. Trade Representative Robert Lighthizer, will discuss unfair intellectual property rights issues that led the U.S. to propose the 25 percent tariffs under Section 301. Tariffs will be levied "unless we make a trade deal. I think we've got a very good chance of making a deal," Trump said in a meeting earlier in the day.
The U.S. -- supported by the European Union, Japan, Mexico and Canada -- asked the World Trade Organization's Committee on Subsidies and Countervailing Measures to examine below-market financing and debt forgiveness as a market distorting practice. The countries, speaking at a meeting in Geneva on April 24, said that counter-cyclical financing during recessions and later debt-to-equity conversions create "distortions in the domestic market that spill over into the international economy and distort international trade patterns." They suggested the WTO rules be amended to consider the subsidy as creating serious prejudice, which would allow other countries to use export displacement as an argument for countervailing duties, according to a paper they presented at the meeting.
The U.S. asked China to end its import restrictions on scrap and asked it to consider less trade-restrictive measures at the World Trade Organization. The European Union began the discussion about China's actions on recycled materials, and received support from five other countries critical of the practice. Countries that send scrap to China have been complaining at the WTO for months (see 1708220009), and although it did not end up banning waste imports, the restrictions it did impose are having "a huge impact on the global recycling chain," South Korean representatives said at the WTO on April 20. These restrictions are separate from the 25 percent tariff China is levying on U.S. aluminum scrap in retaliation for the Section 232 tariffs. The Institute of Scrap Recycling Industries says that the U.S. exported $2.34 billion in aluminum scrap in 2017, and about half of those exports went to China.
Legislation in Mexico that critics said would undermine Mexico's new labor protections (see 1804190032) failed to pass, and unions are celebrating. AFL-CIO President Richard Trumka said working people stopped "legislation aimed at maintaining a rigged system that benefits corporations and the mega-rich," and said that there's a possibility a renegotiated NAFTA can bolster union organizing rights.
The American Association of Port Authorities urged the U.S. trade representative to consider the economic impact of tariffs before implementing them. "While AAPA does not comment on specific trade sanctions, prior to implementing any trade remedies or sanctions, we urge you to carefully consider the negative impacts these actions would have on port and other trade-related American jobs nationwide, including the effects of likely retaliatory responses from our trading partners," the trade group wrote to Robert Lighthizer on April 19.