Rep. Brad Schneider, D-Ill., said that many of his colleagues think “that we can pull back and do everything ourselves,” and that he thinks they may look at the shortages during the COVID-19 pandemic response as evidence that reshoring is the way to go. “You will see more capacity building in the United States, and that makes sense; the idea we can do it all ourselves is pure folly.” Schneider, who was speaking on a webinar hosted by the Washington International Trade Association on April 28, also thinks there needs to be redundancy in supply chains, and more warehousing and less “just-in-time” delivery.
Eight House Republicans have joined to introduce a bill that would require the U.S. trade representative to submit a report to Congress on how World Trade Organization agreements will be fully implemented. In a press release announcing the bill's introduction on April 24, Rep. Ted Yoho, R-Fla., said: “For too long the United States, and the world, has turned a blind eye to much of China’s unfair practices in business and trade, and it has been the American producer and consumer who has paid the price. It’s time the United States and the global community assert their rights under WTO rules to hold China accountable for its behavior on the world stage and ensure a level playing field for all.” He said his bill would prevent China and other high-income nations from receiving special and differential treatment as developing nations. However, under current WTO rules, countries must willingly give up developing nation status; there is no way to force them to leave that status.
The evaluation of exclusion requests related to COVID-19 is too slow, two senators say, and they're asking that the Office of the U.S. Trade Representative eliminate duties on all imports covered by Section 301 that are needed to fight the pandemic. Sen. Pat Toomey, R-Pa., and Sen. Tom Carper, D-Del., sent a letter to USTR Robert Lighthizer April 20, asking him to “work with [Health and Human Services (HHS)], the Federal Emergency Management Agency (FEMA), the Department of Commerce, industry, and other relevant experts to develop a list of inputs, substitutes, machinery, and other products that U.S. companies need to meet the current demand for medical supplies, that will be subject to 301 tariff exemptions. U.S. companies must be able to access the materials needed to manufacture critical medical supplies without the added cost of 301 tariffs for the duration of the COVID-19 emergency, and they should not be subjected to the lengthy process of submitting tariff exemption requests for each individual input required to make products essential for addressing the ongoing pandemic. Time is of the essence, and these exclusions should be issued as soon as possible.”
Eighteen Republicans and seven Democrats in the House of Representatives are asking for Section 232 tariffs to apply to lamination and cores of electric steel, saying an increase in imports of those kinds from Mexico and Canada are a sign of “blatant circumvention” of the 25% tariffs on electrical steel, as they say neither Canada nor Mexico produces electrical steel. The April 15 letter, sent to President Donald Trump, was led by Rep. Mike Kelly, R-Pa., Rep. Troy Balderson, R-Ohio, and Rep. Marcy Kaptur, D-Ohio. AK Steel, which makes electrical steel in Pennsylvania and finishes it in Ohio, has threatened to close those plants because of the competition (see 2003090038). Balderson and Kelly wrote the president on the same issue in early March. Three of the four senators representing those two states asked for these items to be included in March 2018 (see 1803090038).
The International Trade Commission has begun an investigation requested by the leaders of the Senate Finance Committee and the House Ways and Means Committee (see 2004070045) to identify all goods needed for responding to the coronavirus COVID-19 pandemic, and the tariffs and countries of origin for those imports. The report is expected to be finished at the end of April.
The Border Trade Alliance is asking Congress to consider including a “broad removal of tariffs” in the next round of relief funding, but if Congress does not intervene on sections 301 and 232, they recommend lifting tariffs related to the coronavirus pandemic response and an “automatic and indefinite extension” of Section 301 exclusions. They also said that a July 1 date of entry into force for the U.S.-Mexico-Canada Agreement would “be too aggressive. We would urge Congress, in consultation with the administration and our trade partners Canada and Mexico, to agree to a new enforcement date, ideally not before January 1, 2021.”
Sen. Bill Cassidy, R-La., said he will introduce a bill when the Senate returns to Washington that would raise tariffs on Saudi Arabian oil and oil byproducts. “Our nation’s economy, national security and the economic welfare of families across Louisiana is threatened by oil being dumped on the world market at below-production costs,” Cassidy said in an April 9 press release. “Tariffs will restore fair pricing.” The tariffs would vary by the current market price of oil, and would make Saudi imports cost at least $40 a barrel. The law orders the president to impose tariffs under the International Emergency Economic Powers Act within 10 days of passage. The bill was described as actions “in response to Saudi Arabia’s aggression towards the United States petroleum industry.” It also instructs the administration to withdraw all military personnel from Saudi Arabia.
The leaders of the congressional committees that oversee trade policy have asked the International Trade Commission to organize a list of all goods that relate to the response to the COVID-19 pandemic, with their tariff rates, any additional tariffs, and any tariff exclusions on those goods. They also want to know how much of these goods are imported from which countries -- and they want all the data by the end of the month. Senate Finance Committee Chairman Chuck Grassley, R-Iowa, told International Trade Today during a phone call with reporters April 7 that he'd like the tariffs to be eliminated on all the items the ITC identifies. He said assuming the study shows there were trade restrictions that interfered with the typical import patterns of these supplies, “That would be good ammunition to back up our argument.”
Nineteen of the 28 senators on the Finance Committee -- including Chairman Chuck Grassley, R-Iowa, and top Democrat Ron Wyden of Oregon -- told U.S. Trade Representative Robert Lighthizer that having the U.S.-Mexico-Canada Agreement start on June 1 is too soon.
The House of Representatives, on a voice vote March 27, passed a bill that will give businesses access to forgivable loans and grants to keep operations going as the economy grinds to a halt due to the novel coronavirus COVID-19 pandemic. President Donald Trump signed it later that afternoon. It includes a provision that could help importers that have been unprofitable after the imposition of Section 301 or Section 232 tariffs (see 2003250025). Companies can use the losses they incurred in 2018, 2019 or 2020 to get income tax refunds from the previous five years. They could apply now for those 2018 and 2019 losses. The bill also sets in motion a study of the U.S. medical product supply chain.