The free trade deal between the European Union and Vietnam will take effect Aug. 1, the EU said June 30. The deal is expected to eliminate almost all tariffs on goods imposed by the two countries (see 2002120029) and remove non-tariff barriers to allow Vietnamese companies to more easily export to the EU (see 2001020014).
Cambodia and South Korea plan to begin negotiating a free trade deal next month, the Hong Kong Trade Development Council said June 23. South Korea is hoping to diversify its export destinations away from its two largest export markets: China and the U.S., which are embroiled in a trade war, the report said, adding that the novel coronavirus outbreak has been an added incentive to go outside its usual supply chains. Cambodia is hoping to expand on its trade with South Korea, which included exports of nearly $335 million in 2019. The two sides agreed to begin negotiations after concluding a trade feasibility study started last year (see 1912120018).
The Distilled Spirits Council, on the two-year anniversary of retaliatory tariffs on American whiskey on June 22, said that the drop in exports to the European Union of $256 million isn't the full measure of the damage done to their business sector. The EU put 25% tariffs on whiskey and bourbon in response to the national security tariffs on European steel and aluminum. The EU has said it will increase the tax on American whiskey to 50% next June.
The European Commission and Japan signed an agreement to help boost aviation trade, the EC said June 22. The EC said the deal will expand market access for exports of EU aeronautical products to Japan and “significantly reduce” the time it takes for exporters to receive approval for those exports. It will also remove “unnecessary duplications of evaluation and testing activities” for aircraft products, it said.
President Donald Trump was wrongheaded for suggesting the U.S. could sever ties with China, a Chinese Foreign Affairs Ministry spokesperson said June 19, according to a press conference transcript in English. “In this era of globalization, the interests of all countries are closely intertwined,” he said. “Global industrial and supply chains are formed and developed in such ways as determined by market forces and business decisions. As such, it is unrealistic and insensible to try to sever them or wish political forces would override economic law. Such practices will not help solve America's domestic problems. Instead, they will only cause more harm to the ordinary American people.” The spokesperson sidestepped questions about whether Trump’s threats could endanger the U.S.-China phase one trade deal. “... the U.S. certainly does maintain a policy option, under various conditions, of a complete decoupling from China,” Trump tweeted June 18, the day after U.S. Trade Representative Robert Lighthizer told Congress decoupling wasn’t a reasonable trade policy.
The United Kingdom began trade negotiations and released negotiating objectives for Australia and New Zealand June 17. The U.K. said the launch of negotiations with both countries is a “logical step” toward joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. The deals will help the U.K. “diversify our trade, increase the resilience of our supply chains and ensure the UK is less vulnerable to political and economic shocks in certain parts of the world,” Trade Secretary Liz Truss said in a statement.
Importers may want to delay filing for U.S.-Mexico-Canada Agreement reconciliation because the USMCA currently doesn't allow for post-entry refunds of merchandise processing fees, CBP officials said during a National Association of Foreign-Trade Zones webinar on June 16. Maya Kamar, CBP director for textiles and trade agreements, said that although the Office of the U.S. Trade Representative is working with Congress for a legislative fix to the issue, CBP doesn't yet have clarity on whether such a bill will pass (see 2006050034).
Senate Finance Committee Chairman Chuck Grassley, R-Iowa, rejected a compromise position that the United Kingdom reportedly is considering -- ending its ban on U.S. hormone-treated beef and chlorinated chicken, but taxing those imports, and letting food that meets U.K. standards in without a duty. He said the British negotiators believe that this bifurcated approach will encourage U.S. producers to “change our farming practices. But it’s another way of being very protectionist,” he told reporters on a June 16 call. “Agriculture's going to be tough,” he said.
The negotiations toward a U.S.-United Kingdom trade agreement, which are happening online, are starting with the commonalities, but Britain's North American trade commissioner and consul general in New York said he thinks they will be able to find a way forward even on the sensitive issues in agriculture.
While most of the focus on the U.S.-Mexico-Canada Agreement has been on the changes to the auto rules of origin and enforcement measures aimed at Mexico, Crowell & Moring lawyers explained that importers and exporters of textiles and chemicals also can take advantage of rules that changed from NAFTA for inclusion in the updated agreement.