The Trade Guys kick off their recording tour at George Washington University with a live audience participating in Washington International Trade Association’s two-day intensive trade seminar. The guys talk NAFTA, the intensifying trade war with China…and bro hugs.
What We’re Reading
“U.S., Canada Face Tough Issues as They Resume Nafta Talks”
“The U.S. and Canada will resume efforts on Wednesday to resolve issues holding up a renegotiation of the North American Free Trade Agreement.”
“As talks with Canada resume, the biggest sticking point is Canada’s insistence on retaining a dispute-resolution system that allows member states to challenge trade penalties imposed by the others. Mr. Lighthizer has proposed eliminating the system, contained in Nafta’s Chapter 19, and Mexico has agreed to that. But Canada remains unwilling to scrap the mechanism.”
Why it matters: The to-do list to reach a NAFTA deal with Canada is lengthy as the Trump administration and Ottawa resume talks this week. The United States and Canada remain at odds over a special scheme to challenge trade remedies, dairy market access in Canada, intellectual property, cultural exemptions, de minimis, and U.S. national security tariffs on steel and aluminum.
Key questions: Are there simply too many areas to cover for a final deal to be reached? What issues could possibly be traded away to get concessions on others? What could a final U.S.-Canada deal look like?
“Trump’s Nafta Rewrite Holds Promise for Labor Unions”
“Labor unions, a traditional adversary of the Republican Party, could be a winner in President Trump’s planned rewrite of the North American Free Trade Agreement.”
“Last summer, the AFL-CIO, the largest union group in the U.S., promoted a long list of changes it wanted to see in a new Nafta. The handshake agreement with Mexico that President Trump announced this week contains some of them.”
Why it matters: Labor support for NAFTA 2.0 could be a huge win for President Trump and give Democrats political cover to support the deal.
Key questions: What other factors matter for labor support of NAFTA 2.0? Are labor groups willing to back a trade deal between the United States and Mexico that leaves out Canada given that some labor organizations have membership in both countries?
“EU Offer for No Auto Tariffs Is ‘Not Good Enough,’ Trump Says”
“President Donald Trump rejected a European Union offer to scrap tariffs on cars, likening the bloc’s trade policies to those of China.”
“’It’s not good enough,’” Trump said of the offer from Brussels during an Oval Office interview with Bloomberg News. “’Their consumer habits are to buy their cars, not to buy our cars.’”
Why it matters: President Trump turned down an offer from the European Union for the reciprocal elimination of tariffs on cars, despite his call for zero tariffs, zero trade barriers, and zero subsidies between the United States and the European Union. Trump’s rejection comes after he pledged not to impose tariffs on autos imported from the European Union as long as the two sides are negotiating towards the three zeros.
Key questions: How will the rejection of this offer impact trade talks between the United States and the European Union? Is President Trump’s complaint about EU consumer habits something that can be remedied through negotiation?
“Revised TPP to come into force within months”
“The revised Trans Pacific Partnership could be in force by Christmas, opening up trade among eleven Pacific Rim nations.”
Why it matters: As the United States remains locked in NAFTA talks and continues to weigh additional tariffs on auto imports and Chinese products, the 11 remaining members of the Trans-Pacific Partnership are closing in on bringing the deal into force—without the United States.
Key question: What does this development mean for U.S. trade leadership and the ability of the United States to shape international trade rules?