Rep. Ron Kind, a pro-trade Democrat from a rural district in Wisconsin, is questioning the Trump administration's claims that large-scale purchases of commodities would follow the meeting of the Chinese and U.S. presidents at the G-20 Summit in Japan. He sent a letter to Larry Kudlow, the president's chief economic adviser, and to Agriculture Secretary Sonny Perdue on July 17 making this point. "On July 15, Mr. Kudlow stated that the Administration expects that China will soon be announcing 'some large scale purchases' but offered no further details. Farmers in Wisconsin and around the country are under intense pressure to stay above water, and any notifications of additional agricultural purchases should be clearly communicated to the Congress and the public."
Vietnam's General Department of Customs announced several investigations into origin fraud after it discovered foreign companies “taking advantage of Vietnam origin to export to third countries to enjoy preferential treatment,” according to a July 17 report from Customs News, the customs agency’s mouthpiece. The country’s customs is investigating “six large enterprises operating in import and export of wood” products related to China, the report said. Authorities have found several customs violations relating to rules of origin, including companies using a “certificate of fake land use in the document to prove materials are produced in Vietnam.” In one case, Vietnam discovered a company “imported thousands of products from China” but recorded the production in Vietnam, the report said.
The delay in passing the U.S.-Mexico-Canada Agreement is closing other foreign markets for U.S. exporters as trading partners grow more uncertain about the U.S.’s trade negotiations, representatives from U.S. livestock industries said July 16.
Global export controls and international sanctions are not stopping luxury goods from entering North Korea, which is employing a significantly larger smuggling scheme than previously known, according to a July 16 report from the Center for Advanced Defense Studies (CADS), a nonprofit research organization in Washington. The 56-page report details how North Korea works with intermediaries, freight forwarders, private financiers and others to smuggle luxury goods into the country. The report also places North Korea’s smuggling system into context: Between 2015 and 2017, at least 90 countries “served as luxury goods procurement sources” for North Korea, the report said.
China is adding more cities to the 35 already participating in its cross-border e-commerce Comprehensive Pilot Zone Program, according to a July 16 report from the Hong Kong Trade Development Council. The China State Council announced the upcoming additions after its July 3 meeting. While the additional cities have not yet been named, they are expected to benefit from the same advantages offered to other cities in the program, including no value-added taxes on exports, the report said. The zones will also be given “support” for “the establishment of a greater number of overseas warehouses and “e-commerce platforms are to be assisted in the implementation of the appropriate intellectual property safeguards,” the report said.
The U.S. lost its appeal of a 2018 World Trade Organization decision that it had not properly calculated countervailing duties for Chinese pipes, tubular goods, solar panels, aluminum extrusions and other items. China had originally challenged the cases in 2016 -- the cases were brought between 2007 and 2012 (see 1805010071). The earlier ruling held that the U.S. was right to say that Chinese state-owned enterprises count as "public bodies" and therefore their actions can be market distorting. The appeal upheld that element of the case, but also upheld the victories for China. The WTO said that Commerce did not prove specificity in the subsidies for the products, and it also could not show how the SOE inputs distorted market prices. It was not allowed to use other countries' prices as reference points to prove market distortions, the WTO said, unless it had specific evidence that government interference in the market warranted that. The appeal said that countries' ability to use other countries' prices in CVD cases is "very limited."
Senate Finance Committee Chairman Chuck Grassley, R-Iowa, told reporters July 16 that he's no longer making predictions about how or when the China-U.S. trade conflict might get resolved. In April, before the breakdown in talks, Grassley was cheering the progress the administration was making (see 1904100052). He said he had been expecting something to be signed in late May, and when the talks fell apart, "I thought we were at the 10-yard line getting an agreement." So now, he said, "I'm going to be very careful" about reacting to news about how things are going between negotiators. He said he heard the rumors that hawks in China are ascendant, and that an addition to the Chinese negotiating team bodes ill for an agreement, but then also saw commentators saying such pessimism is overblown. "I’m just going to take it a day at a time," he said.
Vietnam’s prime minister ordered the country’s government to find ways to expand trade relations with its “key partners,” including by “removing barriers” to entry into the country of foreign investment, according to a July 15 report from Vietnam's Customs mouthpiece Customs News. At a July 13 government meeting, Prime Minister Nguyen Xuan Phuc heard reports of the country’s assessment of trade relations between Vietnam and several “big partners,” including the U.S., China, South Korea, the Association of Southeast Asian Nations and Japan. The country is aiming to “build sustainable and balanced trade relations with partners, to combat trade frauds, and fraudulence of goods origin,” the report said. The prime minister asked Vietnam’s ministries to introduce new policies related to “trade, monetary matters, finance-banking, IT and cyber security in order to match with advanced international standards,” the report said.
India is increasing import duties on certain Chinese tires for the next five years, according to a July 10 report from the Hong Kong Trade Development Council. The additional tariff will range between about 9 percent and 17.5 percent, the report said, and will cover eight tariff categories on all “China-sourced radial” tires. The tariffs will apply to “outsized tyres typically required by buses or trucks” and is aimed at helping to boost India’s domestic tire manufacturers. A 12 percent to 18 percent import levy already applied to China-made truck and bus radial tires has been in place since 2017.