With the help of Doug Palmer
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– US Trade Representative Katherine Tai will be in Brussels and London this week for what she expects will be “intense negotiations” resolve the Boeing-Airbus dispute and find common ground on steel and aluminum production issues.
– The leaders of this summit of rich democracies largely focused on how to confront China, nations signing a joint communiqué agreeing to fight against its abuse of forced labor, political repression in Hong Kong and aggression against Taiwan.
–President Joe Biden is in no mood to hear your questions about Trump’s tariffs. “Give me a break,” he told reporters at the G-7 summit on Sunday, asking for more time to deal with the major trade problem.
We are Monday June 14th. Welcome to Weekly Trade. Kudos to England for winning their first opener of a European Championship this weekend, a narrow 1-0 victory over World Cup finalist Croatia. The British could surely field two rosters of top attacking talent, but will they have the composure to overcome the pressure? Let us know, does it fit home? [email protected], [email protected] and [email protected].
TAI TAKES BRUSSELS: Trade concerns put on the back burner at the G-7 will take center stage this week as Tai travels to Brussels with Biden.
Boeing-Airbus interviews: Tai arrived in Brussels on Sunday to prepare for what she predicts will be “Intense negotiations” with the EU to resolve the long-standing Boeing-Airbus subsidy dispute that resulted in direct tariffs on dozens of US and European products. She will attend the US-EU summit with Biden on Tuesday before heading to London on Wednesday for meetings with UK trade chief Liz Truss.
The clock is ticking: The parties must act quickly before a four-month tariff break expires next month, resulting in the reimposition of duties on a variety of US and European products. Last week, 113 American and European business groups urged negotiators to reach an agreement as soon as possible to remove tariffs.
Discussions on heavy metals: In addition to subsidies to aircraft manufacturers, Tai will also try to “find a way forward” on a common approach to deal with the steel and aluminum tariffs that have plagued US allies. The trade chief said a multinational deal to tackle China’s steel and aluminum overcapacity was needed to remove former President Donald Trump’s tariffs on metals. She, Commerce Secretary Gina Raimondo and European Commission Commerce Chief Valdis Dombrovskis have agreed to negotiate such a plan by the end of the year.
TARIFF REDUCTION? GO MAN: Tariffs take center stage this week after being pushed out of the limelight at the G-7 last week.
Sensitive subject : Although U.S. trading partners have pressured Biden for months to lift tariffs on steel and aluminum, the president was still apparently in disbelief when the issue was raised at the end of a press conference. Sunday. Just as he was about to leave, a reporter asked Biden what he would do with the tariffs, prompting him to step back and lean on the podium.
“One hundred and twenty days,” he said, referring – roughly – to the length of his term. “Leave me alone. I need some time.”
Take his time : It’s a familiar line from Biden, whose advisers have warned since last year that the outcome of Trump’s trade wars will take a back seat to domestic politics early in his administration. But now, 145 days (not 120) after Biden’s tenure began, U.S. trading partners and importers are starting to question whether it will ever be able to tackle those tariffs.
Basically, there are two ways to read Biden’s comments: On the one hand, his plea for more time may suggest that a policy change is coming. But Biden’s MPs have also made it clear that they believe the tariffs have saved steel and aluminum jobs in the United States, which argues for their retention.
Britain’s talks still frozen: The meeting in Cornwall, England also ended without knowing whether Biden will resume partially completed trade talks with the UK, a key priority for summit host Prime Minister Boris Johnson. Republican lawmakers and transatlantic businesses pushed Biden to commit to resuming those talks, but there is no indication he made any commitments to Johnson at the meeting.
FIGHTING CHINA CONCERNS THE G-7: With tariffs and trade talks on the back burner, G-7 leaders have spent much of their time discussing how to tackle China’s economic boom.
Labor violations weigh heavily: Nations argued in private meetings, public statements and briefings on how to run the world’s second-largest economy on Saturday. The US insisted that China use forced labor against Uyghurs and other minorities in Xinjiang, while the EU questioned whether the framing should focus specifically on China’s violations or on forced labor. in general, the POLITICO team reported from the talks.
Historic reprimand: Sunday, the leaders set on a historic reprimand China’s economic and human rights practices. Released as a statement following the G-7 summit, their statement directly addresses the group’s most controversial issues with China – from forced labor in Xinjiang to political repression in Hong Kong and increased pressure on Taiwan .
Hit all the notes: The leaders called on “China to respect human rights and fundamental freedoms, especially with regard to Xinjiang and these rights, freedoms and a high degree of autonomy for Hong Kong.” And they said they were “concerned about the use of all forms of forced labor in global supply chains, including state-sponsored forced labor of vulnerable groups and minorities, including in agriculture, solar energy and clothing sectors “. They pledged to use their “own available national means”, as well as multilateral institutions, to fight forced labor.
Alternative to Belt and Road: The statement also pledges to offer a $ 100 billion global infrastructure fund to combat the Belt and Road Initiative of China’s 140 countries. It’s probably not enough money to cut China’s billions of dollars in foreign loans, but details on the program are yet to come.
Merkel raises the stakes: Separately, German Chancellor Angela Merkel said Europe will need to see “significant progress” on forced labor issues if the EU is to ratify its investment deal with Beijing. Merkel was one of the main defenders of the case, who was hit last year during The German Presidency Council of the EU before being suspended last month.
The G-7 statement is sure to annoy Beijing. Ahead of the summit, the Chinese government warned the meeting with a statement saying global decisions would not be made “by a small group of countries.”
Carbon tariffs at the border excluded: Amidst all of Chinese politics, the G-7 countries have also pledged to tackle the climate, especially the issue of carbon leakage – the risk of industries moving to countries with lax regulations. The countries said in a statement that they “will work together to address this risk and align our trade practices with our commitments under the Paris Agreement.” But they did not directly address the impending tariffs on high-carbon products that the EU plans to impose. Biden theoretically endorsed the idea, but would need a skeptical Congress to adopt it.
BIDEN PRESENTS THE NEW AMERICAN PURCHASING RULES: The White House last week publish new guidelines intended to restrict the exemption criteria to national procurement rules. Released by the Office of Management and Budget, the guidelines follow Biden’s January executive order cracking down on exemptions from the rules. The new document requires agencies to designate a senior official responsible for national procurement and report on his compliance with the Buy American order, and outlines new information requirements for exemption requests.
The unions praised the guidance, with the United Steelworkers saying it would help “better implement Made in America laws in all federal agencies by evaluating and streamlining the waiver process.”
THE SENATORS URGE BIDEN TO REMOVE NICARAGUA FROM THE TRADE PACT: A bipartisan group of seven senators wrote to Biden last week, asking him to consider expelling Nicaragua from the Central American Free Trade Agreement.
Led by Sens. Jim risch (R-Idaho) and Patrick leahy (D-Vt.) Lawmakers say Nicaraguan President Daniel Ortega’s recent crackdown on political rivals and the suppression of opposition protests should push Biden to reconsider the nation’s membership in the seven-nation trade bloc.
The letter comes days after Tai had a virtual meeting with Costa Rican Minister of Commerce Andres Valenciano, another CAFTA pact member. While the USTR reading indicated that they had discussed strengthening this trade deal, it did not clarify whether they were talking about Nicaragua joining.
– Senators Tom Carper and John Cornyn write an opinion piece urging the United States to re-engage the Trans-Pacific Partnership.
– US and Japan left G7 still at odds over whether to end funding for coal-fired power plants, POLITICO Europe reports.
– The Financial Times examines the G7 alternative at the Chinese initiative “the Belt and the Road”.
– The Wall Street Journal examined why it takes so long for the sofa you ordered to arrive at your doorstep.
– Global shipping constraints are so severe that Home Depot bought its own container ship, CNBC reports.
THAT’S ALL FOR THE WEEKLY TRADE! See you again soon! In the meantime, send a message to the team: [email protected]; [email protected]; [email protected]; [email protected] and [email protected]. follow us @POLITICOPro and @Morning_Trade.