USTR Targets Manufacturing, Agricultural Exports in 2014 Trade Agenda

“In 2012, the United States exported nearly $1.4 trillion of manufactured goods, which accounted for 87 percent of all U.S. goods exports and 61 percent of U.S. total exports,” said the agenda. “To support the growth of advanced manufacturing and associated high-quality jobs here at home, in 2014 the Obama administration will continue to pursue trade policies aimed at keeping American manufacturers competitive with their global peers.” U.S. farmers and ranchers produced a historic high $148.4 billion of food and agricultural goods to consumers globally, said USTR. Further focus on strengthening science-based sanitary and phytosanitary (SPS) standards will continue to boost U.S. agricultural exports, said USTR.

The administration is also prioritizing conclusion of Trans-Pacific Partnership (TPP) negotiations in 2014, according to the agenda. Administration officials, including USTR Michael Froman, had hoped to finish the agreement in 2013 (see 13121110}. The Obama Administration also aims to conclude the World Trade Organization (WTO) Information Technology Agreement (ITA) in 2014. The elimination of duties on modern information technology products through the ITA would boost U.S. technology exports, said USTR. ITA negotiations collapsed in November due to alleged Chinese intransigence over market access (see 13112217).

U.S. trade negotiators intend to use TPP, WTO and Transatlantic Trade and Investment Partnership (TTIP) forums to crack down on intellectual property infringements, the agenda says. “We will use all appropriate trade policy tools to address key trade-related IP issues and resolve specific intellectual property rights issues that undermine the rights of Americans,” said USTR. “We seek to actively combat global counterfeiting that both threatens American jobs and often endangers the health and safety of global consumers. The United States will continue to use the “Special 301” process and annual report to Congress both to drive continued improvements to the IPR protection and enforcement system and to spotlight challenges.” Through the multiple trade negotiations currently underway, the U.S. also aims to institute more substantial regulations on state-owned enterprises, ensure rules of origin provide U.S. domestic manufacturing opportunity and dismantle forced localization barriers. The Obama Administration will also work to fully implement bilateral free-trade agreements with Korea, Colombia, and Panama, according to the agenda.

The inclusion of strict labor rules in trade pacts will also help to maintain U.S. wages and manufacturing capacity, said USTR in the agenda. “This includes finalizing the labor chapter of the TPP while also working with our TPP negotiating partners to identify any of those countries’ labor laws and related practices that may be inconsistent with the TPP obligations and ensure that they are brought into compliance,” said the agenda. “Similarly, we will use the unique opportunity afforded to us in the TTIP to negotiate obligations that protect worker rights and set a high bar for other trade negotiations in the rest of the world.” The Obama Administration is committed to collaborate with Bangladesh to restore Generalized System of Preferences (GSP) to the country, the agenda says. The U.S. will continue to review workers’ rights conditions through GSP and the African Growth and Opportunity Act (AGOA). GSP expired on July 31, 2013 and AGOA is due to expire in 2015 (see 14012918).

The agency will also see to improve trade conditions for environmentally friendly goods, it said. "We will work with the world’s largest traders of environmental goods to eliminate tariffs on these products through a WTO negotiation we commenced on January 24, 2014, initially involving countries representing nearly 90 percent of this $1.4 trillion market,” said USTR. “Eliminating tariffs on goods that help us protect our environment, such as renewable and clean energy technologies, reduces prices and increases their availability.” The U.S., along with 13 other nations and the European Union (EU), announced on Jan. 24 an initiative that aims to eliminate tariffs on environmental "green" goods (see 14012411).

The U.S. intends to continue to dispute, through the WTO and other channels, unfair Chinese trade practices, including export restraints on rare earths, tungsten, and molybdenum, said the agenda. The Obama Administration remains committed to combating discrimination against U.S. products from numerous countries and blocs, including the European Union (EU), said USTR. “The United States remains prepared, as it has been over the last several years, to engage in any meaningful efforts that will advance the goal of ending WTO-inconsistent subsidies for aircraft at the earliest possible date. Tens of thousands of jobs for U.S. aerospace engineers, electricians, and related suppliers depend on U.S. aircraft manufacturers being able to compete globally on a level playing field,” said the agenda. “That is why we continue to pursue a compliance panel proceeding launched in April 2012 due to the EU’s failure to comply with the WTO’s 2011 findings that $18 billion in subsidies conferred on Airbus by the EU and member countries were WTO-inconsistent. At the same time, the United States is vigorously defending U.S. interests in the compliance challenge brought by the EU.” The U.S. intends to develop a strategy to resolve differences in an on-going U.S.-Canadian lumber dispute, the agenda says.

The Obama Administration is also committed to working with Congress to renew expired Trade Adjustment Assistance (TAA), in addition to Trade Promotion Authority (TPA). Many congressional Democrats continue to reject TPA, while pressing for immediate TAA renewal (see 14011013). “Without TAA, we risk allowing hard working American families to slide down the economic scale and out of the middle class. TAA provides resources to eligible workers to develop new skills that are essential for employment in vital growth industries of the 21st century economy,” said USTR. “As the Obama Administration works hard to create and maintain open markets and support jobs through trade, we must also be mindful of our responsibility to ensure that trade policy reflects our values and keeps faith with American workers impacted by global competition.”

The trade community is largely steadfast in its support for TPA, eyeing the legislation as the only means to pass TPP. “We are working closely with USTR and the other relevant U.S. agencies to advance this ambitious agenda across the board,” said a statement from Charles Johnston, chair of the United States Council for International Business’ Trade and Investment Committee and managing director of global government affairs at Citigroup. “The most essential piece of the trade puzzle is Trade Promotion Authority … Without TPA, we cannot negotiate effectively, and Congress’s ability to help guide U.S. trade policy is limited. For these reasons, we urge the Obama administration and Congress to work together to swiftly pass effective TPA legislation.” Business Roundtable released a statement pressing the necessity of TPA to advance the policy agenda (here).

Republican leaders in Congress also lauded the policy agenda, but lamented the lack of TPA emphasis and elaboration on chartering course forward. Republicans in both chambers have repeatedly over recent months prodded Obama to muster Democratic support for TPA (see 14020703). “While I support most of the President’s 200-page trade agenda, the document does not lay out a strategy for passing Trade Promotion Authority," said House Ways and Means Trade Subcommittee Chairman Devin Nunes, R-Calif, in a statement (here). "If we are to achieve our shared goal of creating American jobs through trade, TPA must be enacted immediately, and I call on the President to work with us. In the House, we will continue to provide leadership to advance an ambitious trade agenda throughout the world, in particular with Latin America, where the President's agenda falls short in seeking new opportunities. I look forward to working with the Administration to further these goals.”

The U.S. is also planning to initiate trade discussions with other countries in an effort to boost telecommunications equipment exports as a means to add American manufacturing jobs, said the USTR. "We will seek to negotiate and implement Telecommunications Mutual Recognition Agreements (MRAs) with select countries to facilitate U.S. exports of telecommunications equipment," the agency said. The telecommunications industry approved of the prospect. “The President’s 2014 Trade Agenda demonstrates the Administration’s commitment to pursuing high-standard trade agreements that will open markets and level the playing field for the U.S. [information and communications technology] industry," said Telecommunications Industry Association President Grant Seiffert in a press release (here). "This will ultimately benefit the United States through economic growth, job creation, and enhancing America’s global competitiveness."

Many other industry officials, including President of the Emergency Committee for American Trade (ECAT) Calman Cohen, praised the policy agenda. “ECAT business leaders have consistently pressed for high standards in a final TPP agreement to address ‘new and emerging 21st century issues of concern to U.S. stakeholders…,’ including intellectual property-rights protection, the role of state-owned enterprises, and digital-trade issues, as well as longstanding tariff and non-tariff barriers to U.S. goods and services in TPP markets," said Cohen in a statement (here). -- Brian Dabbs, Tim Warren