Mara Lee

Autos and auto parts make up 25 percent of the NAFTA trade, and the head of the trade group that represents Detroit's Big 3 auto firms says they will push aggressively to get the NAFTA rewrite through Congress next year. Matt Blunt, CEO of the American Automotive Policy Council, said, "If party control changes in one of the chambers, that does make it more difficult to gain approval of USMCA, but I still think it's highly doable." Blunt is the former governor of Missouri, and his father Roy Blunt is in the Republican leadership in the U.S. Senate.

The chairman of the White House Council of Economic Advisers says trade negotiators have made "a heck of a lot of progress" with Europe, the United Kingdom and Japan, and "all of those agreements are going to look similar" to the rewritten NAFTA. Kevin Hassett was speaking at the Global Services Summit on Oct. 17, as he was interviewed by Laura Lane, UPS president of global public affairs. Technically, none of those trade negotiations have opened, as they are not allowed to until Congress sets priorities. The day before Hassett spoke, the Office of the U.S. Trade Representative notified Congress of its intention to begin negotiations (see 1810160057). Hassett said President Donald Trump told his staff, "Once I get a deal with one country, I bet they're really going to cascade, the deals."

The meeting six weeks from now between the presidents of China and the U.S. is unlikely to change the confrontational trajectory the two countries are on, according to a panel of China experts speaking at the Global Services Summit Oct. 17. "This has been a long, slow burn to this boil," said Charles Freeman, senior vice president for Asia at the U.S. Chamber of Commerce. "It's hard to see how we step down from this without some kind of radical compromise on both sides."

When the U.S. and the United Kingdom begin talks on a free trade agreement in April next year, Sir Kim Darroch, the United Kingdom's ambassador in Washington, said he's sure that the U.S. will argue for greater access for agricultural products. He said that the UK will be asking for more government procurement access, and for British airlines to be able to fly between U.S. cities. Darroch, who was speaking at the annual Global Services Summit on Oct. 17, expressed confidence that Britain will not crash out of the European Union, but instead Brexit will follow a "shallow and reliable glide path" with a transition period from March 29 next year through Dec. 31, 2020. No U.S.-UK trade deal can be signed until the UK is out of the EU customs union.

U.S. Trade Representative Robert Lighthizer informed Congress on Oct. 16 that the Trump administration will begin trade negotiations with the European Union, Japan and the United Kingdom. "We are committed to concluding these negotiations with timely and substantive results for American workers, farmers, ranchers, and businesses," Lighthizer said. Negotiations cannot begin for 90 days, and no later than 30 days before they begin, the USTR must publish negotiating objectives. Lighthizer said that the negotiations may proceed in stages, if Congress blesses that approach.

The Office of the U.S. Trade Representative is holding a meeting to review Generalized System of Preferences eligibility for eight countries on Nov. 29, the USTR said in a notice. The Trade Policy GSP Subcommittee is examining whether Ecuador is acting in good faith to enforce an arbitration award, a dispute originated by Chevron (see 12092604). It is examining whether workers in Bolivia, Georgia, Iraq, Thailand and Uzbekistan have rights up to international standards, challenges brought by the AFL-CIO or another labor nonprofit (see 1511240017 and 11110124). And it is continuing to examine whether Laos should join the program. The committee is examining whether Indonesia and Uzbekistan are adequately protecting intellectual property rights. The meeting will begin at 10 a.m. at 1724 F St. NW in Washington, DC.

While the changes are likely at least a year away, a KPMG managing director of Trade & Customs Services, Gisele Belotto, told clients that the "changes [to NAFTA] are pretty extensive, and a lot more than changing the name." KPMG held a webcast on understanding the trade implications of the United States-Mexico-Canada Agreement on Oct. 16. While media coverage has been extensive on the changes to the auto rules of origin, and how that will make it more difficult for Mexican and Canadian autos to enter the U.S. duty-free, KPMG professionals noted that many other products' rules of origin became looser, making it easier to qualify the imports as originating in one of the NAFTA countries.

Companies moving containers through the ports of Los Angeles and Long Beach will no longer have to pay congestion surcharges and instead will pay a flat fee of either $31.52 per 20-foot equivalent unit or $63.04 for other size containers starting Nov. 19, PierPass said. Companies will need to register with PierPass if they have not already, because all trucks bringing containers out of the ports will need to make an appointment. Nine of the 12 terminals at the two adjacent ports already use appointment systems, so most trucking firms serving the ports are already using these systems, the press release announcing the change said. The marine terminals will offer common appointment windows and common last appointment times for each shift.

The United States Hide, Skin and Leather Association and the American Apparel and Footwear Association called for changes to the 9802 program, in an opinion piece in The Hill on Oct 14. Those groups say the value of a hide sent from America to China to be made into shoes should be deducted from the value subject to tariffs when a U.S. firm imports the shoes. Similarly, nylon yarn that will be made into fabric in India should be deducted from the value. "If a company uses a U.S. component that is further processed abroad before it is assembled into an article, it is disqualified," they explained, which means that yarn doesn't count, since it is made into fabric, nor do hides, which must be tanned before they're made into leather. There are no more tanneries in the U.S., so hides that will be in shoes, furniture or clothing are sent offshore unprocessed.

President Donald Trump said American consumers aren't paying more as a result of his tariffs. He said the Chinese don't have enough ammunition to retaliate at the same scale that the U.S. has in what he called a trade skirmish, not a trade war. Trump, who was speaking in a wide-ranging interview on CBS's 60 Minutes Oct. 14, said, "I called it a battle. But, actually, I'm gonna lower that. I consider it a skirmish. And we're gonna win." He said the Chinese want to negotiate, and he might levy more tariffs.