Tai: U.S. Must Shift Trade Policy Focus
U.S. Trade Representative Katherine Tai said the U.S. must shift the focus of its trade policy to rebuilding its domestic manufacturing industries and lessening ties to unfriendly economies. Appearing before the House Ways and Means Committee on Wednesday, Tai said global events such as Russia’s invasion of Ukraine and the supply-chain disruptions triggered by the Covid-19 pandemic point to the need for new priorities. “The problem that we are confronted with today—after two years of Covid and also Russia’s invasion of Ukraine — is that this version of globalization that we are living in has not taken us to a place where we feel more secure,” Tai said.
Both Democrats and Republicans on the House Ways and Means Committee Wednesday prodded Tai about reaching new free trade agreements (FTAs) with several countries like the European Union (EU), U.K. and Kenya, but Tai gave no indication that the administration was going to pursue any such deals. Instead, Tai focused her remarks on the Biden administration push to use Trade and Investment Framework Agreements (TIFAs) to achieve U.S. trade goals. While those types of agreements can address certain areas on trade like sanitary or phytosanitary issues relative to agricultural products, they do not address tariff levels or market access.
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As for China, Tai commented that discussions with Chinese Vice Premier Liu He over their Phase 1 trade agreement commitments had been difficult and resulted in little progress on getting China to live up to their commitments — observations that Tai has made in recent weeks relative to the talks that started in October.
While Tai pointed to other actions by the administration on trade to reduce tensions and remove tariffs in certain areas, she did not offer any new update on getting Canada to bring its operation of tariff-rate quotas (TRQs) for dairy in line with a U.S.-Mexico-Canada Agreement (USMCA) ruling which found them in violation of the deal. Tai also did not indicate whether the U.S. was ready to push ahead with retaliation against Canada in the matter.
Bottom line: While Tai offered lawmakers some additional perspective on the administration’s trade agenda, the areas she did not comment on speak louder on their trade policy.
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