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This Week In Trade

Congress still focused on BAT as Trump heads to Europe

Posted: May 22, 2017

Capitol Hill will be bustling this week -- “World Trade Week,” according to President Trump -- with hearings set to examine the border adjustable tax put forward by congressional Republicans, while President Trump continues his first international diplomatic trip that will culminate in the G7 meeting at the end of the week.

On Tuesday, the House Ways & Means Committee will take another look at its controversial proposal to apply a border adjustable tax on imports and goods sold in the U.S., excluding goods made for export. The full committee hearing is on “increasing U.S. competitiveness and preventing American jobs from moving overseas,” but will focus on the BAT proposal and how -- as a “core element of comprehensive tax reform” -- it will help increase jobs, investment and economic growth in the U.S., according to the hearing announcement.

Ways & Means Committee Chairman Kevin Brady (R-TX) told reporters last week that the BAT would play “a critical role in pro-growth tax reform.”

Treasury Secretary Steven Mnuchin will find himself before the Senate Finance Committee on Thursday to discuss tax reform as well as the Treasury Department's fiscal year 2018 budget proposal. The Senate has been very cool to a border adjustable tax. Mnuchin said last week that Brady's current BAT proposal is not supported by the White House, but said the administration will consider a “refined proposal.”

Commerce Secretary Wilbur Ross will also make his way up to the Hill on Thursday to discuss his department's FY2018 budget with the House Appropriations Commerce, Justice, Science and Related Agencies subcommittee.

President Trump will meet with leaders from the European Union on Thursday, the day before the start of the G7 summit in Italy. Trump will meet with EU Commission President Jean-Claude Juncker -- who has said he might encourage U.S. states to secede in response to Trump's constant support of Brexit -- and European Council President Donald Tusk. On Friday and Saturday, Trump will participate in the G7 in Taormina, Italy. Items to be discussed include the global economy, foreign policy and environmental sustainability.

On the heels of the Asia-Pacific Economic Cooperation trade ministers meeting in Vietnam, where ministers were unable to agree on language for a joint statement, the Senate Foreign Relations' subcommittee on East Asia, the Pacific and International Cybersecurity Policy on Wednesday will discuss U.S. “leadership in the Asia-Pacific” as it pertains to economic issues. The U.S. Chamber of Commerce's senior vice president for Asia, Tami Overby, and Robert Orr, the dean of the University of Maryland's School of Public Policy, will testify at the hearing.

On Monday evening the Senate will vote to confirm Trump's pick for Ambassador to China, Iowa Governor Terry Brandstand.

The Senate will also continue to move forward with the process of confirming mid-level officials in the Trump administration. The Senate Banking Committee is expected to vote on Tuesday on a recommendation for Mira Radielovic Ricardel to be Commerce's under secretary for export administration, while the Senate Judiciary Committee will vote on Wednesday on a recommendation for Vishal Amin to be intellectual property enforcement coordinator in the Executive Office of the President.

The International Trade Commission on Monday will release a report on its antidumping and countervailing investigations into aluminum foil from China, which have so far found a “reasonable indication” that the U.S. aluminum foil industry is injured. The ITC unanimously issued preliminary affirmative determinations in April.

The Commerce Department's Bureau of Industry and Security, meanwhile, will hold a hearing on Wednesday as part of its Section 232 investigation into whether steel imports are harming U.S. national security. If Commerce finds the imports do threaten national security, the president will have 90 days to determine if he agrees -- and to take action to “adjust the imports of an article and its derivatives” or make other non-trade-related moves. Such actions must be taken no later than 15 days after the president determines a response is warranted.

A final rule issued by the Department of Agriculture's Animal and Plant Health Inspection Service that will allow lemons from northwest Argentine to be imported to the U.S. is set to take effect on May 26, much to the chagrin of the U.S. citrus industry. APHIS issued the rule in December 2016, but stays of it have been issued twice. Lawmakers have criticized the administration's handling of the issue, with Sen. Kamala Harris (D-CA) saying that it left her with a “very bitter, sour taste.”

The U.S. Meat Export Federation is having its spring conference on Wednesday through Friday. Senate Agriculture Committee Chairman Pat Roberts (R-KS) will be joined by American Farm Bureau Federation President Zippy Duval for a panel discussion at the conference on the future of agricultural trade on Thursday.

Canadian Foreign Minister Chrystia Freeland is headed to Mexico City on Tuesday to discuss NAFTA with Mexican Foreign Affairs Secretary Videgaray Caso and Economic Secretary Ildefonso Guajardo Villarreal. While in Mexico, Freeland will also participate in a conference about North American integration hosted by the Americas Society/Council of Americas. Freeland and Videgaray Caso will have a panel discussion at the conference on the “strategic issues in the North American relationship,” according to a press release from Freeland's office.

The Brookings Institution will also examine the trade and security relationship between the U.S. and Mexico with former U.S. and Mexican ambassadors on Wednesday. Mexico's current ambassador to the U.S. will deliver the event's introductory remarks, which will be followed by a panel that will include former Mexican ambassador to the U.S. Arturo Sarukhan and former U.S. ambassador to Mexico Earl Anthony Wayne.

The Global Business Dialogue will host a discussion on NAFTA's role in agriculture and automobile production on Thursday. On the auto side, the discussion will include Charles Uthus, vice president for international policy at the American Automotive Policy Council; Yuri Unno, manger for international trade strategy at Toyota Motor Corporation; Ann Wilson, senior vice president of government affairs at the Motor and Equipment Manufacturers Association; and Jeff Werner, general manager of international and public policy at Daimler. The agriculture panel will feature David Salmonsen, senior director of congressional relations at the American Farm Bureau Federation; Ken Barbic, senior director of federal government affairs at Western Growers; Molly O'Connor, government relations adviser at the National Association of Wheat Growers; Shawna Morris, vice president of trade policy at the U.S. Dairy Export Council; and Nick Giordano, vice president and counsel of global government affairs at the National Pork Producers Council.

The Heritage Foundation on Tuesday will host a discussion on its view that Buy American laws are a detriment to Americans. The panel will include Thomas Spoehr, director of the Heritage Center for National Defense; Tori Whiting, research associate in the Heritage Center for Free Markets and Regulatory Reform; Robert Miller, president and CEO of NLMK USA; James Banker, executive vice president of NLMK USA; and Walter Lohman, director of the Heritage Asian Studies Center.

The Washington Office on Latin America will take a look at the current political and economical developments in Cuba on Wednesday with a panel featuring Roberto Veiga, general coordinator at Cuba Posible; Lenier Gonzalez Mederos, vice coordinator at Cuba Posible; Pedro Monreal, economist at Cuba Posible; Pavel Vidal, economist at Cuba Posible; and Geoff Thale, program coordinator at WOLA.

The Peterson Institute for International Economics will host a lecture on Thursday with Princeton University economics and public affairs professor Alan Blinder, titled “Why, After 200 Years, Can't Economists Sell Free Trade?” -- Brett Fortnam (bfortnam@iwpnews.com)