If the new NAFTA passes in the House, "I don't think there's any question but it's going to pass the Senate," Sen. Chuck Grassley, R-Iowa, said May 23. He leads the Senate Finance Committee, which is responsible for moving the trade treaty in that body. He also said he thinks it will be difficult for the ratification in the House to be done before the August recess.
That the U.S. made “unreasonable demands” on China “through maximum pressure” is the “underlying reason” why 11 rounds of negotiations “failed to yield an agreement,” a Chinese Foreign Affairs Ministry spokesperson said May 20. “This wouldn't work from the very beginning.” When U.S. threats didn't work and “instead led to widespread doubts at home and abroad as well as market fluctuations, the U.S. “resorted to muddying the waters and shifting the blame,” he said. “The international community bears witness to the sincere and constructive attitude China has shown in the past 11 rounds of negotiations.” There’s “hope for success only when the consultations proceed on the right track of mutual respect, equality and mutual benefit,” he said. The Office of U.S. Trade Representative didn’t comment.
A Chinese Foreign Ministry spokesperson sidestepped questions at a Beijing news conference May 17 about media reports suggesting new U.S.-China trade talks are off the table for now. Presidents Donald Trump and Xi Jinping “have maintained contact through various means,” the spokesperson said. The Office of the U.S. Trade Representative didn’t comment. The U.S. and China “intend to continue further discussions,” a USTR notice in the Federal Register said, officially proposing the 25 percent Section 301 tariffs on $300 billion in Chinese goods not previously dutied. Requests to appear at public hearings on the proposed List 4 tariffs are due June 10 in docket USTR–2019–0004 at regulations.gov, and written comments are due June 17, the same day the hearings are set to begin. Post-hearing rebuttal comments are due seven days after the hearings end.
Though allegations that China’s “retreat” from previous commitments in the trade talks with the U.S. were the Trump administration’s grounds for hiking the List 3 Section 301 tariffs to 25 percent and proposing a fourth tranche of duties on remaining Chinese imports not previously dutied, it was the U.S. side that actually reneged, suggested a Chinese Foreign Affairs Ministry spokesperson May 16. “It takes sincerity to make a consultation meaningful,” the spokesperson said during a press conference. “Judging from what the U.S. did in previous talks, there are two things we have to make clear,” he said. “First, we need to follow the principle of mutual respect, equality and mutual benefit. Second, words must be matched with deeds. Flip-flopping is the last thing we need.” During the various rounds of trade negotiations, the U.S. “repeatedly rejected rules in consultations and brought difficulties to the talks, while China, on the other hand, has been acting in a constructive spirit all along,” he said. “The international community bears witness to all this.” The Office of the U.S. Trade Representative didn’t comment.
China’s recently issued exclusion process for duties on more than 5,000 tariff lines of U.S. products (see 1905130043) shows it is prepared for a “long-term fight” and may be getting ready to “hunker down” in the trade war with the U.S., said Pete Mento, vice president for Crane Worldwide Logistics.
A vote on the U.S.-Mexico-Canada Agreement will “hopefully” be soon, House Speaker Nancy Pelosi said, but stressed that the deal needs strong enforcement provisions before any progress will be made. During a Washington Post Live interview on May 8, Pelosi said an enforcement agreement is a prerequisite to any vote. “Unless you have it built into the agreement … it’s not binding on the other country. It’s us talking to ourselves,” she said. In a recent conversation with U.S. Trade Representative Robert Lighthizer, Pelosi said, she urged him to include enforcement in the agreement, or else the agreement is “not a serious thing.” Pelosi said the Trump administration has expressed a desire to work on enforcement and said Trump has told her “we want to get to a yes” on the deal. “So hopefully that will be soon,” she said.
China will take “necessary countermeasures” if the U.S. follows through on threats to increase tariffs on Chinese goods, according to an unofficial translation of a statement released by the Chinese Ministry of Commerce on May 8. “The escalation of trade friction is not in the interests of the people of the two countries and the people of the world,” the statement said. “The Chinese side deeply regrets that if the US tariff measures are implemented, China will have to take necessary countermeasures.”
While the Chinese have not levied tariffs on U.S. aircraft, the top manufactured good China imports from the U.S., that could change if President Donald Trump follows through on his May 5 threat to hike 10 percent tariffs to 25 percent, one expert believes. Edward Alden, a trade expert and professor at Western Washington University, said that the Chinese have been seriously negotiating for five months, and if the U.S. walks away, they will hunker down for a long, protracted trade war. They could levy tariffs on airplanes, increase customs hassles for those U.S. firms exporting goods to China and create geopolitical trouble for the U.S.
Reforms of Mexico's labor laws passed its Senate overwhelmingly April 29, and that vote was hailed by U.S. Trade Representative Robert Lighthizer. "These reforms will greatly improve Mexico's system of labor justice and are exactly what labor leaders in the United States and Mexico have sought for decades. As we move forward with the ratification of USMCA, the Trump Administration will work closely with members of the United States Congress and the Mexican government to ensure these reforms are implemented and enforced," his office said in a statement the evening of April 29.
Canada and Colombia were removed from the priority watch list for intellectual property violations, and Tajikistan moved off the watch list, according to the Office of the U.S. Trade Representative's annual review of countries' policies on patents, trade secrets, counterfeits and piracy. Saudi Arabia was moved up to the priority watch list because of deteriorating conditions there, including "rampant satellite and online piracy," a USTR official said April 25.