American farmers are losing market share in Japan as Canada and Australia get the benefit of lower tariffs through the Trans-Pacific Partnership and European producers also get benefits through their region's free trade agreement with Japan.
The U.S. lost its appeal of a 2018 World Trade Organization decision that it had not properly calculated countervailing duties for Chinese pipes, tubular goods, solar panels, aluminum extrusions and other items. China had originally challenged the cases in 2016 -- the cases were brought between 2007 and 2012 (see 1805010071). The earlier ruling held that the U.S. was right to say that Chinese state-owned enterprises count as "public bodies" and therefore their actions can be market distorting. The appeal upheld that element of the case, but also upheld the victories for China. The WTO said that Commerce did not prove specificity in the subsidies for the products, and it also could not show how the SOE inputs distorted market prices. It was not allowed to use other countries' prices as reference points to prove market distortions, the WTO said, unless it had specific evidence that government interference in the market warranted that. The appeal said that countries' ability to use other countries' prices in CVD cases is "very limited."
Rep. Jan Schakowsky, a member of the House working group negotiating with U.S. Trade Representative Robert Lighthizer on the U.S.-Mexico-Canada Agreement, said the second meeting, held the morning of July 11, was interesting, like the first. Schakowsky, D-Ill., whose area of interest in the group is the provision for biologic drug makers, said that topic was covered at the first meeting, before the Fourth of July break.
Stephen Vaughn, former general counsel in the Office of the U.S. Trade Representative, will rejoin King & Spalding as a partner, the law firm said in a July 9 news release. Vaughn was at the law firm before going to USTR. Vaughn "has been directly involved in every major trade-related determination and negotiation that has occurred in the past two and a half years,” said Wick Sollers, head of the firm’s Government Matters practice group, which is over the International Trade team that Vaughn will be joining.
Senate Finance Committee Chairman Chuck Grassley said that although under fast track authority the administration could send the implementing bill for the NAFTA rewrite on July 9, the administration will not be doing that. "There's respect for this legislative process and the importance of Pelosi involved this process... the White House is not going to do anything without consulting with her," he said. He referred to White House Chief Economic Advisor Larry Kudlow's comments earlier that morning about the administration's plans.
Consultations over South Korea's monopoly law sought back in March (see 1903150025) occurred July 9, the Office of the U.S. Trade Representative announced. Michael Beeman, assistant U.S. trade representative for Japan, Korea and Asia Pacific Economic Cooperation Affairs, led the consultation in South Korea. The U.S. says South Korea is not living up to its commitments in the U.S.-Korea Free Trade Agreement (KORUS). The agreement says that a party before the Korea Free Trade Commission or the International Trade Commission should be able to review and rebut the evidence against it.
China and the U.S. have agreed that China has until the end of the year to come into compliance with a World Trade Organization panel ruling on how it administers its tariff rate quotas for wheat, corn and rice. The WTO said that the fact that state-trading enterprises are given specific shares of the lower-duty import quotas, but that those enterprises don't always use all of the quotas nor is the unused portion reallocated to other buyers, means that China restrains the filling of its tariff rate quotas. The notice that the two countries agreed on a compliance timeline was circulated at the WTO on July 4.
Leaders of the generally pro-trade New Democrat Coalition warned the U.S. trade representative not to send an implementing bill for the new NAFTA to Congress on July 9. Rep. Derek Kilmer, chairman of the New Dems, and Rep. Gregory Meeks, co-chairman of the group's trade task force, spoke to reporters July 8 about why they sent a letter that day to USTR warning him off.
House Ways and Means Trade Subcommittee Chairman Earl Blumenauer said he thinks the House could be able to have a vote in the fall on the new NAFTA. Blumenauer, from Oregon and one of nine House Democrats who are tasked with negotiating changes to the deal with U.S. Trade Representative Robert Lighthizer, said he expects the group will meet with USTR "at least once a week." Speaking at a Washington International Trade Association event June 26, he joked that Lighthizer spends so much time meeting with House members and caucuses, "I think he travels the world just to get away from us." Lighthizer is on his way to Osaka, Japan, for the G-20 meeting. He met with the working group the afternoon before he left.
NAFTA foe Rep. Rosa DeLauro, who is on the working group seeking changes to the NAFTA replacement, joined with the president of the AFL-CIO, the head of Global Trade Watch, and a handful of progressive House members to say that Americans are demanding that the biologics exclusivity period be dropped from the trade deal.