Global Trade Plays Out From Davos To Des Moines

Jan 24, 2020  | 10 min  | Ep4523

Nearly four years after making the campaign promise, the Trump Administration is proposing removal of the controversial Waters of the U.S. rule. While EPA Administrator Wheeler says states are free to step in with their own protections, environmental groups and some state governments are promising legal action.

The WOTUS roll back was well received by several farmers, ranchers and agricultural lobbying groups.

In the days before the new rule was announced, the President spent part of the week in Switzerland underscoring his economic victories.

Paul Yeager has our trade coverage.  

Global economic leaders and government types assembled this week in Davos, Switzerland for the World Economic Forum.

Business was on the official agenda for most, but the topics for sideline meetings included troop positions and climate change.

President Trump opened up another trade front with the European Union as threatening to add tariffs on European imports as France looks to tax U.S. tech giants like Google and Amazon.

Donald Trump: “They have trade barriers where you can't trade. They have tariffs all over the place. They make it impossible. They are, frankly, more difficult to do business with than China."

The president continued in his press conference to air grievances about the WTO.

Donald Trump: "The World Trade Organization has been very unfair to the United States for many, many years. And without it, China wouldn't be China. China wouldn't be where they are now. China, that was the vehicle that they used. And I give them great credit. And I also don't give the people that were in my position great credit, because, frankly, they let that all happen.”

One of the most contentious issues for the U.S. is labeling of China and India as developing countries, allowing them to use a different set rules in the WTO. The topic was a frequent discussion point in meetings like this one in Switzerland. 

Roberto Azevedo, Director General, World Trade Organization: “And there is a lot of debate from one side, from the other, concerns are expressed and I think this issue is not going to disappear. We have to face it and how we're going to square the circle is something that we have to figure out.”

Phase One between the U.S. and China may be signed, but that didn’t mean the global economy has stabilized. Officials with the International Monetary Fund said last October the global economy is slowing down but that describe the situation differently.

Gita Gopinath, IMF Chief Economist: “While there are signs of stabilization, the global output outlook remains sluggish and there are no clear signals of a turning point. There is simply no room for complacency, and the world needs stronger multilateral cooperation and national- level policies to support a sustained recovery that benefits all."

One factor in the North American economy is the USMCA agreement, which left the U.S. Senate this week bound for the White House.

Canada’s Prime Minister emphasized his hope for the House of Commons’ approving the new NAFTA.

Justin Trudeau, Canadian Prime Minister: "Passing the new NAFTA in parliament is our priority. Millions of Canadians depend on stable, reliable trade with our largest trading partners from farmers in Alberta and autoworkers in Windsor to aluminum producers and stagnate and entrepreneurs in St. John's or in Vancouver."

Mexico ratified the agreement reached in 2018, but not the version the U.S. signed off on last week.

Attendees to Iowa’s Pork Congress this week in Des Moines were briefed on trade updates in China, USMCA and the number one market by value, Japan.

Mike Paustian, President, Iowa Pork Producers: “They've been a great customer of ours. But once once the US pulled out of the TPP we started to fall behind in some of our export competitors. And so securing that trade deal with Japan that that kicked in on January 1 will win bring us back to that level playing field. So, so that that was a big win for us going forward to because, you know, we were concerned that we would start to lose market share there and now we'll, we'll be able to continue to have access to that market.”

For Market to Market, I’m Paul Yeager.





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