One day after President Donald Trump said negotiations were going "really well," Canada's foreign minister told reporters that technical staff had gotten some issues far enough along that she and U.S. Trade Representative Robert Lighthizer were set "to make some decisions." Trump also said, "I think Canada very much wants to make a deal."
The agreement between the U.S. and Mexico (see 1808270032) contains several changes related to customs processing as part of the market access chapter, the Office of the U.S. Trade Representative said in a fact sheet about the deal. Among those are "new provisions for transparency in import licensing and export licensing procedures," the USTR said. The deal would also prohibit requiring "local distributors for importation" and applying import restrictions on used goods for remanufacturing. "Provisions for duty-free temporary admission of goods to cover shipping containers or other substantial holders used in the shipment of goods" would also be updated, the USTR said.
The Office of the U.S. Trade Representative is forming a U.S.-Kenya Trade and Investment Working Group, with the aim of deepening the trade relationship between the two countries. Kenyan Cabinet Secretary for Industry, Trade and Cooperatives Peter Munya said that although Kenya has increased its exports to the U.S. through the African Growth and Opportunity Act, "its utilization has been suboptimal. Through implementation of the recently launched National AGOA strategy and action plan, Kenya seeks greater US support in order to optimize available opportunities in the remaining seven years of AGOA." According to USTR, there's $1 billion of trade annually between Kenya and the U.S., and more than 70 percent of Kenyan exports to the U.S. are covered by AGOA preferences.
Marketers of low-end consumer electronics (CE) products will be especially vulnerable if the Trump administration imposes a third tranche of 25 percent Section 301 tariffs on Chinese imports, companies said in comments in docket USTR-2018-0026. Both said their businesses are too profit-poor to absorb higher customs duties, and they worry about the pass-along impact of higher pricing.
The Consumer Technology Association asked the Section 301 hearing panel to remove 380 items from the $200 billion list, arguing that there will be a drop in consumer demand as prices rise. Because many of the items are inputs, there will not be a direct 25 percent cost increase, but CTA commissioned a study that said there could be price increases of up to 6 percent, even on U.S. products, because of tariffs on circuit boards.
While most of the witnesses on the first day of Section 301 tariffs hearings on Aug. 20 asked that items be taken off the tariff list, several companies and a trade group asked that more products be taxed. Mike Branson, executive vice president of Rheem Manufacturing's air conditioning division, said he was pleased that several subheadings in heading 8415 were on the latest list of targets. But he said 8415.94.40 and 8414.90.80 need to be added, "otherwise Chinese exporters of finished good air conditioners will be able to avoid the tariffs."
The Office of the U.S. Trade Representative should expand its use of the Generalized System of Preferences to encourage beneficiaries to make policy and enforcement changes, the Information Technology and Innovation Foundation said in a report released Aug. 20. The agency's foreign trade barrier and intellectual property reports should more directly guide decisions "to self-initiate reviews of whether GSP beneficiaries are breaching the program’s trade, market access, or intellectual property criteria," the ITIF said. The USTR is already reviewing GSP benefits for Indonesia, India, Kazakhstan, Thailand and Turkey over various issues (see 1808150034).
A group of 80 trade associations has asked for exclusions to Section 301 Chinese tariffs to be liberally granted, including that they be granted automatically to all importers who have a "binding 'signed purchase order' to procure products from a supplier in China" if that order was signed before July 6.
Tech startups are among the many hundreds of innovators from various industries voicing opposition to a third proposed tranche of 25 percent Section 301 tariffs on Chinese imports (see 1808150002), comments in docket USTR-2016-0026 show. One such startup, Cao Gadgets, worries about the impact tariffs will have on its “family owned small business,” which develops wireless sensor tags for a variety of Internet of Things uses, commented owner Mike Cao. Four days of public hearings are to begin Aug. 20 on the proposed third tranche. Final comments in the docket are due Sept. 6.
Mexico's Economy Minister Ildefonso Guajardo declined to say what Mexico's view is on the tariff rate for autos that do not qualify for a stricter rules of origin under NAFTA. Outside sources familiar with the talks say that the U.S. is asking that the tariff rate be higher than 2.5 percent for non-conforming autos (see 1808130019). "I will not discuss details, because as you know, this is a work in progress, and we have to make sure we have the final outcome -- we are still making an effort with that," Guajardo said in response to a question about the tariff treatment of non-conforming autos from International Trade Today.