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This Week In Trade

GPX Passage, TPP Talks, Finance Trade Hearing To Dominate Trade Action

Posted: March 05, 2012

The main issues expected to dominate the trade debate this week are possible congressional action on legislation reaffirming the U.S. right to impose countervailing duties on imports from China and other non-market economies, the ongoing round of Trans-Pacific Partnership talks in Australia, and testimony by U.S. Trade Representative Ron Kirk before the Senate Finance Committee.

All eyes are on the Senate as it tries to move ahead on the legislation to overturn the appeals court ruling that said the Commerce Department does not have the authority to impose countervailing duties on imports NMEs.

As of last Friday, supporters of the bill say that Senate Majority Leader Harry Reid (D-NV) faces at least two holds from senators that object to his request made last week to advance the legislation by unanimous consent. But signs early today (March 5) indicate these objections appear to have been overcome, potentially allowing the bill to advance this week in the Senate, which would clear the path for House action.

House Majority Leader Eric Cantor (R-VA) has said the House will consider the bill this week, but supporters doubt this will be the case if the Senate has not approved it.

The U.S. Chamber of Commerce and the National Association of Manufacturers back quick passage of the targeted legislation, while the conservative Club for Growth opposes the bill and labeled it a “key vote” on its legislative scorecard.

The eleventh round of TPP negotiations is taking place this week in Melbourne, Australia, where it appears participants will discuss, but not seek agreement, on such controversial issues as potential participation of new entrants including Japan, the rule of origin for footwear, and patent protections for drugs.

One informed source said it seems that work on key issues has slowed down in TPP, calling further into question the administration's goal of concluding a substantial part of the deal by mid-year and a full conclusion by year end. U.S. Trade Representative Ron Kirk had testified to the Ways and Means Committee on Feb. 29 that in light of the year-end conclusion target, the administration would seek fast-track this year.

Neither Kirk nor Deputy U.S. Trade Representative Demetrios Marantis is attending the week-long negotiating session in Australia.

Instead, Kirk will testify on March 7 before the Senate Finance Committee on the president’s trade agenda, the second time in as many weeks he will face congressional inquiries on this topic.

If new information emerges, it may result from the senators posing different questions than their House Ways and Means colleagues, or from Chairman Max Baucus (D-MT) announcing when he plans to hold a hearing on Russia most-favored nation status. The committee has tentatively scheduled the Russia hearing for March 15.

On March 8, Kirk will meet with the Biotechnology Industry Association, which has been a long-term champion of fighting the slow EU approval processes for genetically modified organisms. BIO is also directly involved in trying to work out a deal on a key issue not yet determined in the U.S. TPP patent protection proposal. This relates to the length of time that brand-name manufacturers will have to apply for marketing approvals in TPP countries in order to qualify for stronger than usual patent protections.

The same day, Marantis is giving a keynote address at a meeting of the Information Technology and Innovation Foundation. The foundation’s president has urged the Obama administration and the U.S. Congress in a report issued last week to recognize China's single-minded use of government resources and state-conferred advantages for its companies as a serious threat to U.S. economic and technology prospects.

On the agriculture front, the Senate Agriculture Committee has moved up to March 7 a hearing on the 2012 farm bill, which is further evidence of efforts to reauthorize the 2008 Farm Bill before it expires on Sept. 30. The next hearing on farm policy will be held on March 14, Chairwoman Debbie Stabenow (D-MI) announced.

House Agriculture Committee Chairman Frank Lucas (R-OK) will also begin four field hearings on the farm bill this week.

U.S. efforts to push ahead on a services plurilateral with willing members are still very preliminary and face some thorny issues, a topic Deputy U.S. Trade Representative Michael Punke is likely to address at his speech at an international services conference in Brussels tomorrow (March 6).