Senior trade staffers from the House Ways and Means and Senate Finance committees told industry representatives last month that the congressional trade agenda in 2008 will be a full one. The two committees are expected to take up trade policy topics such as enforcement, unilateral preferences and the effects of globalization. They will also work on legislation covering customs issues.
Trade Adjustment Assistance. Renewal and expansion of the Trade Adjustment Assistance program will be a top trade policy priority in both chambers. The staffers noted that public support of globalization and trade liberalization is declining because of fears and misperceptions about their effects. It is therefore essential that Congress provide an effective way to help as many of those affected by these trends as possible in order to create an environment where future trade initiatives can be successful. People need to see that the government is working to not only create a more open global economy but also to better prepare its citizens to participate in that economy.
China. Staffers indicated that legislation addressing a wide range of trade irritants with China, including intellectual property rights, currency valuation, import safety, and antidumping and countervailing duty rules, is likely to see action in both the House and Senate this year. With U.S. economic growth slowing, however, increasing attention is being paid to both the positive and negative effects that such measures may have on U.S. consumers, domestic manufacturers that use Chinese inputs and U.S. companies invested in China. Committee hearings to gather this kind of information are expected early in the year.
FTAs. While Bush administration officials continue to press Congress to approve legislation to implement the pending free trade agreements with Colombia, Panama and South Korea, the staffers said the outlook for such action remains unclear. The White House can submit implementing bills at any time but has indicated that it prefers not to do so until there is sufficient support among lawmakers to pass them.
The administration plans to send up the Colombia FTA first, but Democratic leaders said last week that they want to see a sustained record of success in reducing anti-labor union violence in that country before they are willing to consider this measure. While there appears to be broad bipartisan support for the Panama agreement, staffers said it is unlikely to begin moving through Congress until the head of Panama’s National Assembly, who is wanted for the 1992 murder of a U.S. soldier, steps down this fall. No movement on the Korea FTA is expected until Seoul fully reopens its market to U.S. beef exports, and even then concerns on automobiles and other issues could cause further delays.
Some staffers noted that more efforts will be made to highlight how FTAs result in increased exports, which are currently playing a substantial role in offsetting the economic effects of the housing market downturn.
Preference Programs. The Andean Trade Preference Act, the U.S.-Caribbean Basin Trade Partnership Act and the Generalized System of Preferences are all slated to expire in 2008.
ATPA preferences will terminate Feb. 29 but lawmakers are considering whether the program should be extended and, if so, how long and for which countries. Some are pushing for an extension at least for Colombia and Peru so they can continue to receive benefits until the FTAs they have negotiated with the U.S. are implemented. These supporters want this extension to be relatively short in order to maintain pressure for a vote on the Colombia agreement. Prospects for continued ATPA benefits for Bolivia and Ecuador are uncertain, as these same lawmakers have expressed concern about the political and economic policies of those two countries. Other members are pushing for a two-year extension for all four countries.
The CBTPA, which expanded the trade preferences available under the Caribbean Basin Initiative, is set to expire Sept. 30. There are currently 19 beneficiaries under this program, but two – Costa Rica and Panama – will become ineligible once their FTAs with the U.S. take effect. The remaining countries are primarily small island nations that generally seek to work together on external trade issues. Ministers from these countries recently met with U.S. officials to discuss prospects for a U.S.-Caribbean FTA, but no further developments are expected in the near future.
GSP, which covers the most countries and products of any U.S. unilateral preference program, will lapse as of Dec. 31. GSP generally enjoys broad support in Congress but reauthorization is usually subject to substantial debate. In addition, the program is usually not renewed before it expires, which can cause difficulties for businesses that rely on it. Finally, there will likely be greater scrutiny of whether changes are needed to the countries and products that benefit from GSP treatment.
Customs. Both the Ways and Means and Finance committees will consider customs reauthorization legislation this year, possibly beginning with hearings this spring. Staffers said these bills are expected to address issues such as drawback reform, supply chain security (possibly including a revisitation of the 100 percent scanning requirement in the 9/11 Commission bill approved last year), import safety, IPR, staffing and revenue protection.
World Trade/Interactive
