Weak TPP Rules of Origin Likely to Benefit Chinese Industry, Says AFL-CIO
The Trans-Pacific Partnership is poised to put into effect weak rules of origin for products from a wide variety of industries, and China is likely to use it to boost exports and further undermine U.S. manufacturing, the AFL-CIO said in a report on TPP published on May 22 (here). The Office of the U.S. Trade Representative, as well as other TPP negotiating partners, continue to keep TPP negotiating terms shielded behind closed doors, despite growing calls for the U.S. to make the text public. The details that have come to light, however, indicate rules of origin are expected to be weak, meaning China could export a near-fully assembled product to a TPP country, and that product will still get preferential duty treatment when shipped to the U.S., said the report.
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
“China is already integrated into trade and supply chains with all TPP countries – far more deeply than the United States is in many cases,” said the report. “Given the weak rules of origin likely to be in the TPP and the ease with which China skirts existing rules, the end result of the TPP is likely to be a further opening of the U.S. economy to China – without gaining any reciprocal market access or imposing higher standards.” The report rejects the argument that the pact will bring TPP countries “into a U.S.-centered orbit” with China losing influence in those markets.