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This Week In Trade

China delegation in DC for talks; Brexit faces another key vote

Posted: January 28, 2019

Chinese officials will be in Washington, DC, this week to engage with their U.S. counterparts, while across the Atlantic the British Parliament will hold a series of crucial votes that could determine the future of Brexit.

Vice Premier Liu He will lead a delegation of Chinese officials that will be in town on Wednesday and Thursday to speak with U.S. Trade Representative Robert Lighthizer, Treasury Secretary Steven Mnuchin and other U.S. officials. The talks are expected to focus on intellectual property issues, which reportedly tripped up an earlier round of talks in Beijing.

In an interview with The Washington Times last week, White House National Security Adviser John Bolton said the U.S. had made clear to China its extensive demands for structural changes and enforcement in the IP sphere. “We have given China a long list of changes we expect them to make in the intellectual property area, in the question of discrimination against foreign investors, really right across the board,” he said. “Over 140 specific things that we want to change. And we don’t want lip service to this if we reach agreement. We want actual implementation. We want verification. We want proof that things will be different. If we can make progress in those areas it will be very significant.”

If U.S. and Chinese officials can’t reach a deal by the beginning of March, the White House will increase tariffs on $200 billion in Chinese goods from 10 percent to 25 percent. Commerce Secretary Wilbur Ross said last week the two sides were “miles and miles from getting a resolution,” but added later in an interview on CNBC that there was “a fair chance we do get to a deal.”

Tuesday will be another watershed day for Brexit as British lawmakers are expected to vote on a series of amendments to Prime Minister Theresa May’s Brexit deal in hopes of finding a package that will get the support of the majority of the House of Commons. Several amendments include assurances that the UK will not end up leaving the European Union with a deal in place; a handful of amendments promote a no-deal Brexit. Other amendments would extend the March 29 deadline for the UK to reach a deal with the EU or call for a second referendum. The speaker of the House of Commons determines which amendments lawmakers can vote on.

As the UK attempts to figure out what it wants in a Brexit deal, the U.S. is moving ahead with its preparations for trade negotiations with London. USTR will hold a hearing on Tuesday to inform its negotiating objectives for a potential U.S.-UK deal. Witnesses from business, industry, agriculture, services and IP groups are scheduled to testify.

The U.S. International Trade Commission on Thursday will hold a hearing to solicit advice on the probable economic effects of providing duty-free treatment to British goods.

Formal talks between the U.S. and UK cannot begin until after the UK has left the EU. If the UK reaches a deal with Brussels that establishes a transition period for the UK to leave, London will be able to negotiate deals but not enter into them until the end of that transition period.

Tuesday marks the deadline for the White House to send Congress a list of changes the U.S.-Mexico-Canada Agreement would require to U.S. law. The president is required to submit the report to Congress 60 days after the signing of a trade deal, according to the 2015 Trade Promotion Authority law.

The Washington International Trade Association will hold its inaugural Washington International Trade Conference on Tuesday, with former U.S. Trade Representatives Susan Schwab and Michael Froman to serve as honorary conference co-chairs. Schwab will moderate a discussion with House Ways & Means ranking member Kevin Brady (R-TX) to kick off the conference. Other topics that will be covered at the conference include USMCA, trade tensions with China, investors’ reactions to trade tensions and the current political environment for trade policy.

The Peterson Institute for International Economics will host Italian Economy and Finance Minister Giovanni Tria on Tuesday morning for a discussion on the Italian and European economic outlook. -- Brett Fortnam (bfortnam@iwpnews.com)