Chamber Hopes Section 232 Tariffs Will Be Lifted 'Early,' GSP Renewed Promptly

The U.S. Chamber of Commerce said further decoupling from China is certain if China doesn't do more to step up on industrial subsidies, intellectual property rights protection, trade secret theft and other U.S. companies' priorities. Myron Brilliant, head of international affairs for the Chamber, told reporters on a Jan. 13 call that there's not much political space for incoming President Joe Biden to roll back tariffs, even as his campaign was critical of the economic consequences of the trade war.

The Chamber was more optimistic on the prospects for a quick removal of Section 232 tariffs on Europe, and, perhaps, a quick resolution on the long-standing Airbus-Boeing dispute, which has led to tariffs on both sides. He said this “could be accomplished early,” because “they want to collaborate closely with Europe on a range of issues,” and these trade irritants are in the way of that.

John Murphy, senior vice president for international trade policy, said during the call that the Chamber is seeing its members looking to countries other than China for production or inputs, and that they also recognize they have to diversify their consumer export strategy beyond China.

“One of the challenges is China is such a fabulous place to have as a node of supply,” he said, because of the economies of scale and the efficiencies the country has achieved as it's developed. But Murphy said it's clear there's going to be some level of decoupling. “The question is, how much ground can we keep in the commercial relationship,” he said.

Brilliant, and many other trade watchers, have expressed hope that with a united front with Europe, the U.S. could achieve more reforms in China. But Senior Vice President for European Affairs Marjorie Chorlins said the agreement in principle on investment between the European Union and China sends “an unfortunate signal about their willingness to collaborate.” She said the jury is still out on whether Europe will be willing to confront China with the U.S.

Brilliant said that he hopes the Biden administration will build on the momentum that the current U. S. trade representative made on a United Kingdom and a Kenya free trade deal, and predicted that Congress will be ready to renew Trade Promotion Authority when there is a completed trade deal presented to it.

Also in Congress, the Chamber wants to see the Generalized System of Preferences benefits program and the Miscellaneous Tariff Bill renewed “as soon as possible,” he said.

Murphy said he's optimistic that there's a path to renewal soon. He acknowledged, in response to an International Trade Today question, that Democrats have presented proposals that would make qualifying for GSP more difficult for the developing countries in the program. He said that in “the view of the business community, these can be settled and overcome pretty soon.”

When asked whether India would be restored to GSP participation, Murphy said it depends on whether the Biden administration wants to take the “mini deal” with India, which he said is “not very far-reaching, but there are a number of pieces that are in the interest[s] of both countries.”

However, Nisha Biswal, vice president for South Asia at the Chamber, downplayed the possibility of trade advances with India anytime soon. “Even a 'mini deal' in the current administration was not crossed over the finish line in almost two years of effort,” she said.