Trade Win In Japan While USMCA Passes Deadline Without Approval

Dec 6, 2019  | 4 min  | Ep4516

At the beginning of the week, President Trump threatened to raise tariffs on steel and aluminum from Brazil and Argentina. 
A few days later, he got a deal with a favored U.S. trading partner. 
Paul Yeager has our trade roundup.

The week of trade news started with a working Thanksgiving holiday as Canada’s trade minister came to Washington, D.C. and was joined by contemporaries from Mexico. The three nations are trying to finalize the USMCA agreement.

Supporters of the pact would like to see the U.S. Congress sign-off by year’s end. However, the clock is ticking as House Democrats continue to ask for language adjustments involving labor and safety.

Advocates for reworking the 90’s-era NAFTA renewed efforts for ratification via press releases and conference calls. The group is touting improved opportunities for American farmers and factory workers.   

Sen. Charles Grassley, R – Iowa: “So there's everything good about it, plus a whole bunch of things that need to be negotiated now that were not in NAFTA, because they didn't even exist at the time and after like digital trade is an example. Intellectual property is another example. So it's very important that we get this done.”

Japan’s Parliament delivered a win for U.S. producers by ratifying a trade deal that paves the way for import of American beef and other agricultural goods.

Japan imports $14 billion in U.S. farm products annually and is America’s third-largest market. President Trump said when the deal was reached back in September, tariffs would be scrapped or lowered on American beef, pork, wheat, cheese, corn and wine.

The Japanese have long had protectionist policies on agricultural imports. Likewise, the U.S. has targets of its own including a 2.5 percent import tariff on Japanese cars.

Talks will continue between the two nations with a larger focus on U.S. automobile imports.

The president took a global trade message to NATO meetings this week. During public appearances with German and French leadership, global trade, again, became part of the conversation. 

Mixed messages on both sides of the China trade deal were common this week. The past 17 months have seen the world’s top two economies locked in the biggest global trade war since the 1930’s. One of the latest Trump Administration barbs accuses Beijing of cheating to become an economic power.

In October, the two sides agreed to a modest breakthrough still leaving thorny issues on the vine. The Chinese pledged to buy more American farm exports while Trump agreed to hold-off on raising tariff levels.

The president has said the Phase 1 agreement will likely come after the 2020 presidential election. But hours later, a report said otherwise.

Sen. Charles Grassley, R – Iowa: “I can only conclude that this President statements is to put pressure on China. I think that I've, in the last two weeks heard so many positive things coming out of Beijing, about reaching agreement, particularly inviting Lighthizer and Mnuchin over to Beijing again, to nail things down.”

For Market to Market, I’m Paul Yeager.


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