Mara Lee

Rep. Bill Pascrell, D-N.J., who was ranking member on the House Ways and Means Trade Subcommittee, and Rep. Rosa DeLauro, D-Conn., a prominent NAFTA foe, are soliciting signatures for a letter they plan to send later this month on the importance of including Mexican labor reforms in a new NAFTA, now called the U.S.-Canada-Mexico Agreement.

With the second round of announcements on Section 301 exclusions (see 1903010029), trade professionals are trying to find patterns of what is granted -- so far, 985 requests -- and what has been denied -- a little over 4,500. About 3,300 requests on hundreds of tariff lines have been tentatively approved by USTR, if CBP says the exclusions are administrable. Nicole Bivens Collinson, who leads the international trade and government relations practice at Sandler Travis, said that if all of those were to go through, about 45 percent of all requests would have been approved.

The general counsel to the U.S. trade representative said that after five trilateral meetings with the European Union and Japan, the countries have reached "general agreement" on how the World Trade Organization should address subsidies and state-owned enterprises. He said it's not just U.S. blue-collar workers who have grown dissatisfied with globalization, and pointed to the new populist government in Italy, Brexit and the Yellow Vest movement in France.

Rep. Jackie Walorski, R-Ind., said that with an approval rate of just under 6 percent for steel exclusion requests when domestic firms objected, "it really looks like somebody's finger is on the scale." In a sit-down with International Trade Today, Walorski explained how what started with complaints from 10 businesses in her district -- which is heavy with steel-consuming RV manufacturers -- has made her office the place for companies around the country to share their problems with exclusions. "We knew this is probably what was going to happen," she said of the exclusion process that favors domestic producers.

U.S. Trade Representative Robert Lighthizer heard dozens of questions about the new NAFTA and the fate of Section 232 tariffs on steel and aluminum from about 50 members in the New Democrats caucus, but specifics were few, even as one called it a "good, candid conversation."

When U.S. Trade Representative Robert Lighthizer was asked during his Senate Finance Committee testimony March 12 if the China trade deal might come together by the end of March, he said it remains to be determined. "Well, we’ll see ... I don’t know when something’s going to happen. Something is either going to have a good result or we’re going to have a bad result before too long," he said. "But I’m not setting a specific time frame and it’s not up to me. I’m working as hard as I can, and the president will tell me when the time is up or the Chinese will." He told Sen. Rob Portman, R-Ohio, a former USTR himself, that the Chinese are offering concessions with the goal of getting Section 301 tariffs lifted, and he said that "is under debate."

House Majority Leader Steny Hoyer, D-Md., said that while the Democrats have real concerns on how the new NAFTA "will affect trade, how it's going to affect the environment, how it's going to affect prescription drug availability," U.S. Trade Representative Robert Lighthizer has credibility in Congress, and will be listened to. Lighthizer is scheduled to address all Democrats on March 13, the first time he has met with the full caucus.

Senate Finance Committee Chairman Chuck Grassley, R-Iowa, said that since tariffs on the largest, third tranche of Chinese products are at 10 percent, an exclusion process isn't necessary. He said he agrees with the Office of the U.S. Trade Representative's position that unless that tariff goes up to 25 percent, there won't be exclusions offered.

House Speaker Nancy Pelosi did not directly answer a question on whether the new NAFTA would be ratified in her chamber, but suggested that U.S. Trade Representative Robert Lighthizer is highly respected and is seen as someone who cares about enforcement. She was speaking March 8 at the Economic Club of Washington, D.C. Pelosi noted that she voted for the original NAFTA, and believes trade in the region is "very important," though she also said that in some ways, NAFTA did not live up to expectations. She said that her members are worried about treatment of pharmaceuticals in the rewrite, as well as the environment, and labor rights in Mexico, but she said, "whatever is agreed to in those three areas, the most important element of a trade agreement is enforcement. If you don't have enforcement, you ain't got nothing, because it's just a conversation, a list of things."

Broad descriptions of the budget for trade-related operations show the administration would like to spend more on enforcement, and would like to collect more fees from travelers and traders. The submissions, released March 11, for fiscal year 2020, asked for $9 million more for the Bureau of Industry and Security -- slightly more than last year's requested increase. "The Budget increases resources to support the Department of Commerce's membership in the Committee on Foreign Investment in the United States (CFIUS), the summary said. "The Budget includes $16 million to support the President’s robust trade agenda," the summary said, including implementing the John S. McCain National Defense Authorization Act of 2019, which asked Commerce to identify emerging technologies that should be subject to export controls. The summary said the administration wants to establish "a new initiative within the International Trade Administration to counter the circumvention or evasion of U.S. trade actions aimed at those who engage in unfair and illegal trade practices."