The proposed third tranche of 25 percent Section 301 tariffs on Chinese imports targets equipment “critical for the build-out” of 5G mobile phone technology, the Internet of Things and “big data,” according to K.C. Swanson, Telecommunications Industry Association director-global policy, in prehearing testimony posted in docket USTR-2018-0026. Though the Office of the U.S. Trade Representative hasn’t released a schedule of witnesses to testify at four days of public hearings on the tariffs beginning Aug. 20, Swanson is scheduled to testify Aug. 21, she said. Requests to testify were due Aug. 13 under the deadline USTR Robert Lighthizer extended from July 27 when he announced Aug. 1 he will “consider,” under President Donald Trump’s direction, raising the third tranche of proposed duties to 25 percent from 10 percent (see 1808010070).
US Trade Representative (USTR)
A U.S. Cabinet level position which serves as the President's primary representative, negotiator, and spokesperson regarding U.S. trade policy. The USTR heads the Office of the United States Trade Representative which develops and coordinates U.S. policy for international trade, commodities, and direct investments, as well as overseeing trade negotiations with other countries.
U.S. Trade Representative Robert Lighthizer, after two days of discussions with Japanese Minister for Economic Revitalization Toshimitsu Motegi, said the two sides "had frank discussions" on their respective views on trade and investment. They will be exploring "ways to fill the gap between their positions and to promote trade between the United States and Japan," USTR said in an emailed statement.
U.S. Trade Representative Robert Lighthizer and U.S. Secretary of Agriculture Sonny Perdue announced Aug. 7 that the Morocco would begin allowing commercial imports of American poultry products. "I welcome Morocco’s agreement to allow imports of U.S. poultry meat and products and the economic opportunities that will be afforded to U.S. producers," Lighthizer said. The government estimated that the Moroccan demand will be about $10 million in the first year. USTR said the U.S. had global sales of poultry meat and products of $4.3 billion in 2017. The Food Safety and Inspection Service posted information on export requirements for Morocco on Aug. 7.
The bilateral meeting between Mexico and the U.S. on July 26 was very productive, Mexican Economy Minister Ildefonso Guajardo said, saying it was evident that the chief NAFTA negotiator for the next administration and U.S. Trade Representative Bob Lighthizer have a rapport, as they have known each other for years. Jesus Seade, who represents Mexico's president-elect, was the ambassador for Mexico's delegation to the World Trade Organization at the same time Lighthizer worked in Geneva.
U.S. Trade Representative Robert Lighthizer said the effort to get China to change its industrial policy and intellectual property practices will take years, but added that "that's not to say what we're doing now will be in place for years." Lighthizer was testifying July 26 to a Senate Appropriations subcommittee on the administration's trade policy, and was pressed again and again on how long tariffs will continue to increase costs on American businesses, and how long retaliatory tariffs will damage their ability to export.
The Consumer Technology Association wants the Office of the U.S. Trade Representative to remove 54 tariff lines from the list of imports from China targeted for a second tranche of 25 percent Trade Act Section 301 duties, said Sage Chandler, vice president-international trade, in comments filed July 23 in docket USTR-2018-0018. Chandler also testified at the USTR’s public hearing on July 24. The 54 tariff lines were well more than double the 22 Harmonized Tariff Schedule product codes that Chandler said CTA members had identified nearly four weeks ago for exclusion from the new list of duties (see 1807100025). Tariffs on the proposed products “will harm the very industries they seek to protect, all while failing to influence China's behavior or help the administration's stated goal of eliminating China’s discriminatory trade practices,” Chandler said in her latest comments.
It’s “difficult to read the tea leaves,” or “glean” any lessons, from why the Office of the U.S. Trade Representative removed certain tariff lines from the initial list of Section 301 tariffs, said David Cohen, a lawyer with Sandler Travis, during Sports & Fitness Industry Association (SFIA) webinar July 18. The USTR on June 15 announced it deleted 40 percent of the product lines from its first list of proposed Section 301 tariffs on Chinese imports (see 1806150003). The rationale behind those changes isn't apparent, he said.
The retaliatory tariffs from the European Union, China, Canada, Mexico and Turkey in response to U.S. steel and aluminum tariffs are being challenged at the World Trade Organization by the Office of the U.S. Trade Representative. "The U.S. steel and aluminum duties imposed by President Trump earlier this year are justified under international agreements the United States and its trading partners have approved," the USTR said in a July 16 news release. "However, retaliatory duties on U.S. exports imposed by China, the EU, Canada, Mexico and Turkey are completely without justification under international rules.
Most of the computer, aviation and automotive, electrical and machinery products that will be hit by tariffs under Section 301 are produced by foreign companies operating in China, according to an updated study from the Peterson Institute for International Economics. The think tank says it aims to do "truth telling about the benefits of globalization" as well as study labor market adjustment due to globalization and how to find a sustainable growth model for mature economies.
The reactions from industry and Capitol Hill on the Section 301 tariffs were largely split along lines previously drawn over the Trump administration's general approach to tariffs. House Ways and Means Committee Chairman Kevin Brady, R-Texas, said in a news release that while the changes from the initial list of products from China were "encouraging, " he is "alarmed that additional products are now placed on the list for possible future action." Brady called on the Office of the U.S. Trade Representative to "narrow these tariffs and implement an effective exclusion process that provides relief for American companies, unlike the problematic Commerce 232 exclusion process.”