The Miscellaneous Tariff Bill became law Sept. 13 with the signature of the president, the White House announced on Sept. 13. The tariff rate reductions on nearly 1,700 items will take effect Oct. 13 -- 30 days after enactment. The reductions, which will last through the end of 2020, only affect the Most Favored Nation rate and not Section 301 tariffs. The International Trade Commission developed the list, and most of the items are intermediate goods, but some are consumer goods that are not produced in the U.S.
A bipartisan group of a dozen senators have asked the secretary of commerce and the U.S. trade representative to open negotiations with Canada with an eye to renewing a softwood lumber agreement similar to the one in place between 2006 and 2015. Sen. James Inhofe, R-Okla., and Sen. Jack Reed, D-R.I., led the letter, which they released publicly on Sept. 12. The old agreement protected domestic producers through quotas, but had escape valves tied to the market price. The senators noted that with antidumping and countervailing duties on Canadian imports (see 1801020034), it has become more expensive to build houses or make window frames.
As the director of the Wilson Center's Canada Institute ran through the areas of conflict between the U.S. and Canada in NAFTA talks -- procurement, cultural exemptions, extended patents for biologics -- she made predictions in some arenas and shrugged on others. When it comes to whether Canada will raise its de minimis from $25 Canadian to $100 U.S., as Mexico has done, Laura Dawson merely said, "These are the kinds of concessions you get at the 11th hour. We're maybe at hour 10, hour 9."
China says that since the U.S. missed its late August deadline to implement changes required by a loss in a case before the appellate body at the World Trade Organization, it would like permission to suspend $7 billion worth of concessions in trade with the U.S. The case, begun in 2013, concerns the methodology of determining antidumping duties in non-market countries, primarily Vietnam and China. If a company accused of dumping product in the U.S. does not cooperate with a Commerce investigation in a way that the U.S. believes it is independent of state control, Commerce assigns a country-wide dumping duty. The WTO said that approach can be problematic in some instances (see 1610190037). China's request will be considered on Sept. 21. The U.S. can request arbitration on its changes to comply with the ruling, or can ask for a compliance panel to be formed.
Politicians from Texas expressed anxiety and optimism about the future of NAFTA as they talked to a group of young Hispanics from around the country assembled for the Congressional Hispanic Caucus Institute in Washington on Sept. 11. "Most of us are hopeful we will eventually have a trilateral agreement," said Rep. Filemon Vela, D-Texas, who was introducing the panel of those associated with interest groups and an academic. He said NAFTA is "dependent on the interwoven aspects of the economy of all three nations," so a Mexico-U.S. pact is not enough. "If we have to move forward on a bilateral basis, in all likelihood things will not go very well," he said.
It's odd to be talking about blockchain in terms of regulatory policy, said Aaron Arnold, a fellow at Harvard University who studies trade controls to prevent proliferation of weapons of mass destruction. "The technology itself is meant to disintermediate actors," he said during a panel on blockchain and trade security at the Stimson Center, a Washington think tank that focuses on security.
Canada continues to avoid characterizing how close it is to reaching an agreement on NAFTA with the U.S., and Canada's Foreign Minister Chrystia Freeland sought to both downplay the significance of her return to Washington for just one day and to point to it as a sign of her deep commitment to reaching a deal.
The formal notification of a NAFTA deal may not comply with the Trade Promotion Authority law, according to Washington state Democrat Rep. Suzan DelBene, who sits on the House Ways and Means Committee, and six of her colleagues. "While we appreciate that it takes time to iron out the final details and text, we believe that it is not in the spirit of TPA to send Congress an official notification letter until all three parties have formally agreed to move forward together with an updated trilateral agreement," they wrote to U.S. Trade Representative Robert Lighthizer Sept. 10.
Even as President Donald Trump and a top Mexican negotiator suggest that NAFTA could be resolved on Sept. 8, Canada's Foreign Minister Chrystia Freeland continued to sidestep questions about how close Canada is to arriving at a deal. "My negotiating counterparty is Ambassador [Robert] Lighthizer. I think that question is really to the president," she said. "We're making progress."
China is a bigger problem than Canada, President Donald Trump told reporters Sept. 7 on Air Force One, and said he has tariffs ready to go on all the other Chinese products that have not faced additional tariffs in the trade war thus far. "Nobody has ever done what I’ve done. The $200 billion we’re talking about, could take place very soon, depending what happens with them," he said, referring to the third tranche of Chinese goods subject to Section 301 tariffs (see 1807110050), whose comment period ended Sept. 6. "And I hate to say that, but behind that, there’s another $267 billion ready to go on short notice, if I want. That totally changes the equation," he said, according to various media reports.