Mara Lee

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."

The Canadian Minister-Counselor for Trade said negotiators on the new NAFTA solved the roster problem in the old Chapter 20 of NAFTA, which was that any country could block the appointment of panelists in a dispute (see 1807230029). "That particular issue is a dramatic improvement from NAFTA 1 and NAFTA 2," Colin Bird said March 8 during an International Trade Update conference hosted by Georgetown's law school. President Donald Trump said on March 8 about the U.S.-Mexico-Canada Agreement that "we’ll be submitting [it] to Congress very shortly," and said the deal is "a great deal for the United States."

Supply chain location changes are difficult and take time, so companies are turning to other ways to avoid or reduce Sections 301 and 232 tariffs, experts said at a March 7 Georgetown Law International Trade Update (see 1903070033) panel on the Trump administration and the supply chain. For steel and aluminum imports, there's been "a big uptake in foreign-trade zones," said Lynlee Brown, a senior manager at Ernst & Young. With Section 301, companies are using drawback, and after a recent CMS message, they may be taking advantage more often of substitution drawback. But the best bang for the buck, Brown said, is in customs valuation. Companies are making changes there not only because of Section 301, but also because of the administration's tax reform.

As long as the trade talks are limited to industrial goods -- which does include fisheries under World Trade Organization rules -- European Union Trade Commissioner Cecilia Malmstrom said she thinks the talks could conclude before the current commission leaves office in late October. Malmstrom was visiting Washington to talk to her counterpart, U.S. Trade Representative Robert Lighthizer, and to give a speech at the Georgetown Law International Update.

A lawyer representing the American Institute for International Steel recapped the arguments he made when announcing a June 2018 lawsuit over the constitutionality of Section 232 of the 1962 Trade Expansion Act (see 1806270036), while a lawyer representing the American Iron and Steel Institute said that while the importers may disagree with the policy of worldwide tariffs, that doesn't make it unconstitutional.

A Trump administration official, the former U.S. trade representative during the George W. Bush administration and a prominent trade lawyer discussed the weaknesses of the World Trade Organization -- and globalization more generally -- during a session at the Georgetown Law International Trade Update March 7.

Sen. Gary Peters, D-Mich., and Sen. Richard Burr, R-N.C. reintroduced a bill that would establish a task force in the Commerce Department to investigate potential trade abuses, with the goal of helping small and medium-sized businesses that lack the resources to bring antidumping cases to the department. "Michigan’s cherry industry and our state’s manufacturers in particular have faced these challenges, and they often lack the legal teams needed to elevate these issues," Peters said in announcing the S.B. 564, which was introduced Feb. 26. The press release also quoted cherry farmers like Isaiah Wunsch, who said, "Farmers and other small business owners currently have few administrative options when we are faced with dumping or other unfair trade practices, because the cost and complexity associated with investigating and litigating these issues can present major financial and technical barriers to small family businesses." The same bill was introduced in February 2018, and was later joined by Sens. Debbie Stabenow, D-Mich., Angus King, I-Maine, and Marco Rubio, R-Fla.

Eight of the 10 members of Arizona's congressional delegation, including both senators, have signed a letter to the Commerce Secretary arguing that the suspension of the Mexico tomato agreement is not in the national interest. "We encourage the Administration to continue to craft agricultural trade policy that seeks to strengthen the industry nationally, not one that is calibrated around regional or seasonal interests," the March 1 letter said. They encouraged Commerce to revise the tomato suspension agreement rather than terminate it without a replacement, because the latter move would create uncertainty in the supply chain and could trigger retaliation against agriculture exports.

The Congressional Research Service evaluated whether President Donald Trump can unilaterally withdraw from NAFTA, as he has threatened to do to force a vote on its replacement. Their assessment -- a 19-page report -- boils down to probably not. Mexico and Canada could not challenge such a move, the researchers said, because of the text's provisions about withdrawal. But whether U.S. law would allow it is ambiguous, they said, and any such proclamation would end up in court.