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The U.S. trade deficit in goods and services jumped 18.9 percent in December and grew 12.5 percent from 2017 to 2018, according to trade statistics released March 6 by the Department of Commerce. The monthly and annual deficits were the highest since 2008, and 2018 was the second straight year the annual deficit hit a record high.
The Department of Commerce initiated March 4 an investigation under section 232 of the Trade Expansion Act of 1962 to determine whether the present quantity or circumstances of titanium sponge imports threaten to impair U.S. national security. An affirmative determination could result in import restrictions such as tariffs or quotas. Press sources note that nearly all U.S. imports of titanium sponge come from Japan and Kazakhstan.
President Trump announced March 4 his intent to terminate the eligibility of India and Turkey as beneficiary developing countries under the Generalized System of Preferences. These changes will not take effect until at least May 3 and will be enacted by a presidential proclamation. Once that proclamation takes effect, thousands of products imported from these two countries will no longer be eligible for duty-free treatment under GSP.
The Trump administration plans to continue its tough trade policies in 2019 but also intends to pursue several high-profile trade liberalization initiatives, according to the administration’s third annual trade policy agenda.
An additional tariff on $200 billion worth of imports from China will remain at 10 percent “until further notice,” according to a notice from the Office of the U.S. Trade Representative expected to be published soon in the Federal Register. However, the delay has not stopped Congress from continuing its pursuit of a process for companies to request exclusions from this tariff.
The Trump administration has denied thousands more requests for exclusions from the additional tariffs it has imposed on imports from China but has made no additional approvals, according to information made available by the Office of the U.S. Trade Representative. Most such requests remain at various stages of review but USTR is making progress in conducting those reviews.
The implementation date for adding a second group of locations to the Department of Agriculture’s Public Health Information System export component has been postponed from March 4 to May 20 to give exporters and destinations more time to prepare.
The Food and Drug Administration has announced a new strategy describing how it is integrating new and existing import oversight tools as part of a comprehensive approach to food safety.
President Trump said Feb. 24 that he will postpone the scheduled March 2 increase in tariffs on $200 billion worth of imports from China in light of what he called “substantial progress … on important structural issues” in bilateral trade talks. Once this change is formalized, the Section 301 additional tariff on the so-called List 3 products will remain at ten percent for the foreseeable future, as no other deadline for increasing the tariff to 25 percent has yet been announced.
The following final revocations and modifications of U.S. Customs and Border Protection classification and other rulings are included in the Feb. 20, 2019, Customs Bulletin and Decisions and will be effective with respect to goods entered or withdrawn from warehouse for consumption on or after April 22.
The increased tariffs the U.S. and China are imposing on each other’s products are not likely to be very effective in protecting domestic companies and instead will mostly divert trade to other countries, according to a new study from the United Nations Conference on Trade and Development.
A growing list of trade irritants has stalled U.S.-India trade talks and could prompt the White House to narrow or suspend India’s eligibility for duty-free exports to the U.S., according to press reports.
Congress has directed the creation of a long-awaited process for requesting product-specific exclusions from the Section 301 additional tariffs on $200 billion worth of imported goods from China. These tariffs are currently 10 percent but are scheduled to be increased to 25 percent as of March 2.
The results of the Department of Commerce’s section 232 investigation into the effect of automobile and auto parts imports on U.S. national security were submitted to President Trump Feb. 17. However, neither those result nor the DOC’s recommendations have yet been made public. The president now has up to 90 days to decide whether to take action in this case.
The U.S. and China saw “progress” in recent trade talks in Beijing but “much work remains,” according to a Feb. 15 White House statement. Talks will continue in Washington during the week of Feb. 18 as the two sides seek to avoid a scheduled March 2 increase in U.S. tariffs on $200 billion worth of imports from China from 10 percent to 25 percent.
President Trump said Feb. 12 that he might postpone a planned tariff increase on $200 billion worth of imports from China if the two sides are “close to a deal.”
As of Feb. 10 U.S. Customs and Border Protection is accepting in the Automated Commercial Environment entries of products that have been excluded from the Section 301 additional tariffs on imports from China. The exclusions granted thus far, which apply only to so-called List 1 goods subject to a 25 percent additional tariff, are retroactive to July 6, 2018, and will be effective until Dec. 28, 2019.
A recent sanctions penalty case highlights the importance of performing heightened due diligence, particularly with regard to affiliates, subsidiaries, or counter-parties known to do business with countries or persons subject to U.S. sanctions or that otherwise pose high risks due to their geographic location, customers, suppliers, products, or services. The Office of Foreign Assets Control states that this case also represents a “marked change” to the way it will respond to sanctions violations.