causes of U.S. trade deficits and a clampdown on import duty evasion.
The executive
orders came a week after Trump's promise to replace Obamacare imploded in
Congress and a week before he meets with Chinese President Xi Jinping in
Florida, a summit that promises to be fraught with trade tensions.
Trump said at
a White House signing ceremony that he and Xi were "going to get down to
some serious business" next week and vowed that "the theft of
American prosperity" by foreign countries would end.
One of the
orders directed the Commerce Department and the U.S. trade representative to
conduct a 90-day review of the causes of massive U.S. trade deficits. It will
study the effects of abuses such as the dumping of products below costs, unfair
subsidies, "misaligned" currencies and "non-reciprocal"
trade practices by other countries.
"We're
going to investigate all trade abuses, and, based on those findings, we will
take necessary and lawful action to end those many abuses," Trump said,
adding that he wasn't beholden to any businesses.
Trump
administration officials have said they plan tougher enforcement of U.S. trade
remedy laws and will initiate more unilateral trade deals. In his 2016 White
House bid, the New York businessman campaigned heavily against free-trade deals
and accused China of draining jobs from U.S. factory towns with cheap exports.
Chinese Vice
Foreign Minister Zheng Zeguang on Friday said the U.S.-China trade imbalance
was mostly the result of differences in the two countries' economic structures
and noted that China had a trade deficit in services
"China
does not deliberately seek a trade surplus. We also have no intention of
carrying out competitive currency devaluation to stimulate exports." Zheng
told a briefing about the Xi-Trump meeting.
The study of
trade abuses appeared aimed at justifying unilateral retaliatory trade actions
by the United States, said Matt Gold, a former deputy assistant U.S. trade
representative who is now an adjunct trade law professor at Fordham University
in New York.
"They
probably think it will give them better political ammunition," Gold said.
But he added
that it would not likely reveal anything that is not already in the Office of
the U.S. Trade Representative's annual list of trade barriers, which also was
released on Friday. The report criticized China's excess industrial capacity
and requirements for technology transfers and cyber security, which it said are
aimed displacing foreign products with domestic versions.
The trade
abuses study will focus on those countries that have chronic goods trade
surpluses with the United States.
China tops the
list, with a $347 billion surplus last year, followed by Japan, with a $69
billion surplus, Germany at $65 billion, Mexico at $63 billion, Ireland at $36
billion and Vietnam at $32 billion.
The study also
will examine past trade deals that have failed to produce forecast benefits for
the United States, as well as World Trade Organization rules that U.S. Commerce
Secretary Wilbur Ross said do not treat countries equally, such as on taxation.
The United
States has long complained that WTO rules allow exports from other countries to
be exempt from value-added taxes (VAT), but do not allow equivalent corporate
income tax benefits for U.S. exporters.
The Trump
administration is considering a border tax that would be levied on imports and
which would aim to put the United States on a similar tax basis for trade as
countries that have VAT.
The second
trade order will fight nonpayment and under-collection of anti-dumping and
anti-subsidy duties the United States slaps on many foreign goods.
White House
National Trade Council Director Peter Navarro said some $2.8 billion in such
duties went uncollected between 2001 and the end of 2016 from companies in some
40 countries.
Navarro said
the order directs the Commerce and Homeland Security departments to close these
gaps by imposing tougher bonding requirements to ensure duty collections and
new legal requirements for assessing risks associated with importers.
0 Comments