The Trade Guys continue their recording tour; this time at the University of Maryland’s Robert H. Smith School of Business. They are joined by a special guest, Rick Powers, the Port of Baltimore’s director of marketing. The guys and Rick discuss updates on NAFTA, the tit-for-tat with China, and roll-on/roll-off (a.k.a. RoRo) shipping’s relationship with tariffs.
What We’re Reading
“Trump tariffs mean uncertainty for booming Port of Baltimore”
“Lee Connor, a freight forwarder and customs broker at the Port of Baltimore, says it’s too early to gauge the whole impact President Donald Trump’s tariffs on steel, aluminum and other products could have on trade through the booming shipping hub.”
“But already, he says, he’s seen some effects.”
“Connor, president of the century-old John S. Connor Inc., was making improvements to its warehouse at the port this year. Since Trump raised a tariff on imported steel in March, the cost of the project has risen: Connor’s contractor told him his pipe supplier had to raise prices by 17 percent.”
“The Port of Baltimore saw a record 21.6 million tons of trade for $28 billion during the first half of 2018. But analysts say Trump’s tariffs, and retaliatory measures by China and other trade partners, will be a drag on that growth going forward — and one that could grow if the tit-for-tat escalates into a fully fledged trade war.”
Why it matters: The Port of Baltimore has set a record pace for volume and value of goods handled in the first half of 2018 but the trade war has thrown the sustainability of that success into doubt.
Key questions: What kind of economic damage could the trade war do the Port of Baltimore itself? What would lower cargo activity mean for port modernization plans or employment at the port? How is the port coping with the trade war?
“Auto tariffs would be ‘devastating’ for both Canada and U.S.: Trudeau”
“If Donald Trump follows through on threats to slap tariffs on cars made in Canada, the result would be ‘devastating’ for the auto industry in both countries.”
“’Well, we know that if the president were to move forward with his punitive tariffs on cars that he’s threatened, it would be devastating, obviously, to the Canadian auto industry, but it would also be devastating to the American auto industry,’ Trudeau told Lauren McNabb, Brett Megarry and Greg Mackling at 680 CJOB/Global News Radio.”
“Asked about President Trump’s vow to slap tariffs on Canadian auto imports if no NAFTA deal is reached, Trudeau insisted he won’t bow to threats.”
Why it matters: President Trump’s threat of imposing tariffs on autos, including those imported from Canada, looms large over the North America Free Trade Agreement talks. Canadian Prime Minister Justin Trudeau has vowed that the tariff threat won’t impact Canada’s negotiating positions despite acknowledging that car tariffs would have a devastating impact on the Canadian auto industry.
Key questions: Is Prime Minister Trudeau’s stance credible given the enormous impact auto tariffs would have on the Canadian economy? Will President Trump’s pressure play pay off?
“U.S. Businesses Ramp Up Lobbying Against Trump’s Tariffs”
“From California apple growers to Maine lobstermen, businesses are joining forces to try to persuade President Trump that tariffs are hurting U.S. industries.”
“On Wednesday, organizations representing thousands of companies in industries including retailing, toy manufacturing, farming and technology plan to announce they are cooperating on a lobbying campaign called Tariffs Hurt the Heartland to oppose tariffs on imports.”
“It is the latest sign that businesses are ratcheting up lobbying against tariffs that the Trump administration has imposed, or is considering, as Mr. Trump says he will defend American manufacturing jobs. As of June 30, nearly 450 entities employed lobbyists on trade issues—up from about 160 at the start of the year and about 100 when Mr. Trump took office, according to lobbying-disclosure reports compiled by the nonprofit Center for Responsive Politics.”
Why it matters: Businesses continue to sound the alarm as President Trump weighs additional tariffs on China and duties on imported cars.
Key question: So far, President Trump has followed through on his tariff pledges despite loud opposition from U.S. and multinational businesses. Will this new coalition be able to impact the president’s thinking?
“U.S. Proposing New Round of Trade Talks With China”
“The U.S. is reaching out to China for a new round of trade talks, in an effort to give Beijing another opportunity to address trade issues before the Trump administration implements additional tariffs on Chinese imports, according to people briefed on the matter.”
“Senior U.S. officials, led by Treasury Secretary Steven Mnuchin, recently sent an invitation to Chinese counterparts headed by Vice Premier Liu He, proposing another bilateral trade meeting, the people said.”
Why it matters: The Trump administration appears to have decided to give Beijing another chance to strike a deal and head off tariffs on $200 billion of its products, despite President Trump recently remarking that now is not the time to make a deal with China. Treasury Secretary Stephen Mnuchin has been chosen to lead the talks and he has reportedly favored reaching a deal with China that would include new market access commitments but would avoid structural reforms to the Chinese economy that United States Trade Representative Robert Lighthizer and White House Trade Advisor Peter Navarro have pushed for.
Key questions: Have President Trump’s tariff threats have put enough pressure on Beijing to convince them to strike a deal that is acceptable to the Trump administration? Does the selection of Treasury Secretary Stephen Mnuchin to lead the talks signal that the more hawkish voices in the Trump administration have been sidelined?