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Trump Seen Leaning Toward Promoting Trade Critic, Levying Harsh Penalties on Imports

Wednesday, February 28, 2018
Sandler, Travis & Rosenberg Trade Report

Press sources are reporting that a prominent trade critic is in line to take on a greater policy role at the White House just as the Trump administration is considering a raft of potential import restrictions.

Peter Navarro, formerly an economics professor who co-authored an economic blueprint for Trump during his presidential campaign, has been serving as head of the National Trade Council Trump created in 2017. Navarro was one of the first members of the president’s trade policy team but reportedly saw his influence curtailed over time by other, more moderate voices. That situation could change if, as is being reported, Navarro is named assistant to the president for trade policy.

A more prominent role for Navarro could signal a more protectionist direction for the administration just as the president prepares to make a number of key trade policy decisions in the next few months. These include how to proceed in negotiations to revamp NAFTA and the free trade agreement with Korea, whether and how much to restrict imports of steel and aluminum, and whether and how hard to hit China for its alleged theft of U.S. intellectual property.

According to press sources, Trump is already leaning in that direction. He told a gathering of U.S. governors this week that if it takes tariffs to “bring the steel industry back into our country … let it take tariffs.” He also reportedly indicated to advisors that he wants to impose additional tariffs of 25 percent and 10 percent, respectively, on imports of steel and aluminum, which would be even higher than those recommended by the Department of Commerce. Other options offered by the DOC included higher tariffs on major exporters along with a cap on shipments from other countries or across-the-board import quotas. Trump has until mid-April to make final decisions, although some press sources are reporting that an announcement could come in the next two weeks.

An Axios article adds that the White House is also “preparing to impose tariffs on … potentially hundreds of Chinese products” in a section 301 investigation launched last summer on China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation. The Office of the U.S. Trade Representative is conducting this investigation and officially has until Aug. 18 to make a determination, and the article indicates that recommendations are still being considered.

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