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This Week In Trade

Ongoing TPP Talks, ITA Symposium, Colombia FTA Entry Into Force Spur Busy Trade Week

Posted: May 14, 2012

Posted: May 14, 2012

The week in trade gets a rolling start with the ongoing 12th round of negotiations for the Trans-Pacific Partnership (TPP) agreement in Dallas, expectations for a “soft launch” of negotiations to expand the Information Technology Agreement (ITA), and the entry into force of the U.S.-Colombia free trade agreement after a years-long haul.

The TPP negotiations, which kicked off May 8, are scheduled to continue throughout the week and officially end on May 18, although chief negotiators are slated to wrap up their work on May 16 and hold a closing press conference. Prior to that point, chief negotiators will spend more time discussing the possible entry of Canada, Mexico and Japan into the TPP. They will also discuss plans for the June trade ministers' meeting in Kazan, Russia and the 13th round of TPP talks scheduled to take place in the U.S. in early July, according to a U.S. negotiator.

Negotiating groups meeting this week include market access, rules of origin, environment, financial services, intellectual property, temporary entry, legal issues, sanitary and phytosanitary measures and competition, according a press release from the Office of the U.S. Trade Representative.

In a related development, executives from Singaporean state-owned investment firm Temasek, who were in Dallas over the weekend, will travel to Washington to meet with U.S. government officials to express their opposition to the U.S. proposal on state-owned enterprises in TPP. Temasek is worried that being classified as an SOE under the U.S. proposal could disadvantage it in relation to private companies

Also early this week, industry stakeholders and government representatives are meeting in Geneva for a May 14-15 symposium celebrating the 15th anniversary of the ITA's sealing. Alongside the events, there are expected to be active discussions about how to expand the ITA through new negotiations.

Many stakeholders are anticipating a “soft launch” of such talks at the World Trade Organization's ITA Committee meeting on May 15, although a key outstanding factor in determining their ultimate fate will be whether the European Union is willing to scale back its demands for addressing non-tariff barriers, stakeholders agree.

U.S. Trade Representative Ron Kirk, who was in Dallas over the weekend, has a busy week back in Washington. It began early this morning with an address at American University about environmental markets and exports. Tomorrow (May 15), Kirk will speak the National Council of Textile Organizations (NCTO) about textiles and the TPP as part of the group's annual meeting.

NCTO is concerned chiefly about the impact of Vietnamese apparel imports on the U.S. industry through the agreement, and has been pushing for USTR not to derogate from its initial proposal for a yarn-forward rule of origin. It will also seek to get lawmakers on board with its position during a day-long lobbying effort on Capitol Hill on May 16, according to a press release.

Kirk continues his public appearances at an event to celebrate the entry into force of the U.S.-Colombia free trade agreement being hosted tomorrow at the U.S. Chamber of Commerce. House Ways and Means Trade Subcommittee Chairman Kevin Brady (R-TX) and Colombian Ambassador to the U.S. Gabriel Silva will also be in attendance.

The FTA enters into force tomorrow after a long road. The deal was finalized in 2006 and President George W. Bush attempted to pass the deal through Congress in 2008. But that effort was thwarted by then House Speaker Nancy Pelosi (D-CA), who stripped the agreement of its “fast-track” status. The deal was finally passed by the U.S. Congress last fall along with FTAs with Panama and South Korea.

The U.S-Korea FTA, also known as KORUS, entered into force on March 15.  This week, South Korean Trade Minister Bark Taeho will travel to Washington for the first meeting of the Joint Committee established under the FTA to monitor the operation of the agreement. The meeting is expected to be largely pro forma.

Bark will also make two public appearances, first on May 16 at the Peterson Institute for International Economics and then again on May 17 for a breakfast event hosted by the Washington International Trade Association.

Looking again at the early half of the week, a vote to invoke cloture in the Senate on a motion to proceed to a bill that would reauthorize the Ex-Im Bank (H.R. 2072) is expected today. It is still unclear whether the Senate leadership has agreed on a process for letting Republican senators offer amendments.

Also this week in the Congress, House Republican critics of the administration's export control reform initiative hope to offer an amendment to the National Defense Authorization Act (NDAA) that would curtail the extent to which the White House can ease controls by transferring items off the U.S. Munitions List to the Commerce Control List.

Tomorrow, stakeholders also face the deadline for submitting comments on the U.S. Department of Agriculture's proposed rule aligning U.S. beef and cattle import regulations with international risk guidelines on bovine spongiform encephalopathy (BSE) -- also called "mad cow" disease. The rule is of great importance to the EU, which hopes to resume its meat exports to the U.S. once it goes into effect.