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On March 30 and 31, U.S. Trade Representative (“USTR”) Katherine Tai appeared before the House Ways and Means Committee and the Senate Finance Committee, respectively, to present the trade policy agenda of the United States. Biden administration for the coming year.1 In substance, the hearings were quite similar, and the administration’s vision for the Asia-Pacific region, particularly China, figured prominently in both hearings.
In her prepared testimony before both bodies, Ambassador Tai said the administration was pursuing a “worker-centric” trade policy. She said the current US-China trade relationship is “unfair” due to state subsidies and policies inconsistent with US labor and environmental standards. “vigorously defending our values and economic interests against the negative impacts of the PRC’s unfair economic policies and practices.” These actions included strategic domestic investments in the US economy to reduce dependence on China.2
During the question-and-answer period of both hearings, Ambassador Tai was asked about specific pieces of legislation that would help the United States move beyond past China policy. She highlighted national spending programs, such as the semiconductor funding programs included in the America COMPETES Act and the US Innovation and Competition Act, as well as reforms to trade remedy procedures in the Leveling the Act. Playfield 2.0. Congresswoman Terri Sewell (D-AL) and Sen. Rob Portman (R-OH) highlighted the Leveling the Playing Field 2.0 Act in their questions. Ambassador Tai stressed that no one policy will completely solve the problem, saying both domestic investment and trade remedy reform would be necessary in her approach.
Republicans, including Congressman Adrian Smith (R-NE) and Senate Finance Committee member Mike Crapo (R-ID), were widely concerned that the USTR office was not making one enough in the first year of the Biden administration. Ranking member Crapo was particularly skeptical of the administration’s proposed Indo-Pacific Economic Framework (“IPEF”), as it did not allow for market access provisions. He noted that the IPEF is the administration’s main proposal to counter Chinese expansion in the region, and the proposal as it currently stands seems limited in scope. Ambassador Tai responded to these questions by saying that while the tariff reduction was not on the table for IPEF, she would work diligently to ensure that American goods have more opportunities in the region. Indo-Pacific.
Since the USTR office released its Section 301 disqualifications shortly before the hearings, several members, including Congresswoman Jackie Walorski (R-IN) and Senator Tom Carper (D-DE), wanted to know if the USTR office would consider any further exclusions, and whether the USTR office would consider making the currently granted exclusions retroactive beyond October 12, 2021.3 On the issue of future exclusions, Ambassador Tai said she was open to further rounds of 301 exclusions should circumstances warrant. However, she was less committed to retroactivity, promising to work with the various senators and representatives who interviewed her to see what she could do on the matter.
Footnotes
1 Biden Administration’s 2022 Trade Policy Agenda, WAYS AND MEANS CMTE. (30 March 2022), https://waysandmeans.house.gov/legislation/hearings/biden-administration-s-2022-trade-policy-agenda>;
President’s trade policy agenda for 2022, UNITED STATES SENATE CMTE. ON FINANCE (March 31, 2022), https://www.finance.senate.gov/hearings/the-presidents-2022-trade-policy-agenda>.
2 Ambassador Katherine Tai’s Testimony to the House Ways and Means Committee Hearing on the President’s 2022 Trade Policy Agenda, DISABLED. OF US COMMERCE REPRESENTATIVE (March 30, 2022), https://ustr.gov/about-us/policy-offices/press-office/speeches-and-remarks/2022/march/testimony-ambassador-katherine-tai-house – means-means-committee-hearing-presidents-2022-commercial-policy>;
Ambassador Katherine Tai’s Testimony to the Senate Finance Committee on the President’s 2022 Trade Policy Agenda, DISABLED. UNITED STATES TRADE REPRESENTATIVE (March 31, 2022), https://ustr.gov/about-us/policy-offices/press-office/speeches-and-remarks/2022/march/testimony-ambassador-katherine-tai- senate-finance-committee-hearing-of-presidents-2022-commercial-policy>.
3 For more information on the 301 exclusion process, please refer to “Office of the US Trade Representative Reinstates Section 301 352 Exclusions” elsewhere in this bulletin.
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