Nearly two weeks after the last batch of Section 232 tariff exclusion determinations were posted, the Bureau of Industry and Security posted eight more denials, all for Borusan Mannesmann Pipe in Texas, a Turkish-owned oil country tubular goods production facility.
At 12:01 a.m. July 6, the additional 25 percent tariffs against Chinese imports across 818 8-digit tariff lines went into effect. Within a minute, China hit back, imposing a 25 percent tariff on 545 tariff lines. The Chinese government said the U.S. has started "the largest trade war in economic history." China said "the duties are typical bullying behavior, which will have a serious impact on the global industrial and value chain and will hinder the pace of global economic recovery, [and] trigger global market turmoil," according to an unofficial translation.
More than 2,000 people and organizations submitted comments on the idea of implementing higher tariffs on imported cars and car parts, with the overwhelming majority rejecting the idea. The National Association of Manufacturers noted that U.S. automotive exports increased eight-old from 1980 to 2017, and that imported parts are vital to automotive manufacturing's price competitiveness.
Despite hope that senators who were not ready to support the Miscellaneous Tariff Bill could be won over on June 28 (see 1806280065), the bill did not come up for a vote before the Senate adjourned for the July 4 holiday. Senate Finance Committee staffers did not offer any estimate of when the MTB might be considered.
Whichever way the World Trade Organization decides on the validity of U.S. tariffs and quotas on metals and other countries' retaliatory tariffs, it hurts the rules-based system, said Jennifer Hillman, a Georgetown University law professor and former member of the WTO appellate body. Hillman spoke on a panel at a Global Business Dialogue trade policy association event. If the WTO says that a claim that an action was taken to protect national security -- when there's no war between the parties, and the item is not clearly war materiel, such as ammunition -- then almost any protectionist measure could be justified, she believes.
A Louisiana Republican introduced a bill that would require 20 percent of imported seafood to be inspected by the Food and Drug Administration, and require that the first 15 shipments from a new exporter each be inspected. If a shipment fails any measure of inspection, the exporter would be subject to 15 consecutive inspections again. Currently, about 2 percent of imported seafood is inspected, according to Food and Water Watch.
White House economic adviser Peter Navarro told an audience at the Hudson Institute that if China abandoned half of its industrial policy practices, it wouldn't be enough to resolve the problem. Navarro did not mention anything about tariffs at the June 28 event, but rather the elements of what he calls China's economic aggression that the U.S. is hoping to force change on through the leverage of tariffs.
Senate leadership is hoping to move the Miscellaneous Tariff Bill on the evening of June 28, said Ron Sorini, a principal at Sorini and Samet. The hold from Sen. Roy Blunt, R-Mo., that was preventing the vote (see 1806200043) was lifted and Sorini said that as senators were canvassed about allowing a vote under unanimous consent, there were a few objections, but "they think they’re resolvable."
U.S. Trade Representative Robert Lighthizer released a lengthy criticism of retaliatory tariffs, saying U.S. tariffs on aluminum and steel are "wholly legitimate and fully justified" and that other countries "concocted a groundless legal theory" that the U.S. tariffs are safeguards rather than national security-based. "Faced with massive excess capacity that puts the very future of our steel and aluminum industries at risk, President [Donald] Trump took certain measures that he deemed essential to the national security of the United States," Lighthizer said in the June 26 statement. "These measures were implemented only after long and careful analysis, and after all trading partners had the chance to address our concerns."
An effort to add an amendment to the Senate farm bill that would require approval from Congress for Section 232 tariffs to go into effect was stopped on June 27. Sen. Sherrod Brown, who said steel towns in his home state of Ohio have been devastated, blocked a vote on the amendment sponsored by Sen. Bob Corker, R-Tenn. Brown, a Democrat who largely supports President Donald Trump's approach on trade, said that Canada and Mexico "are primary targets for transshipment" of unfairly traded steel from China, and said that everyone has "seen the tricks China uses to get around the antidumping and countervailing duty laws."