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China Agreement, USMCA Highlighted in Annual Trade Barriers Report

Friday, April 03, 2020
Sandler, Travis & Rosenberg Trade Report

A phase one trade agreement with China, the U.S.-Mexico-Canada Agreement, and other trade deals and negotiations helped lower foreign trade barriers to U.S. exports in 2019, according to the Office of the U.S. Trade Representative’s annual National Trade Estimate report.

The NTE report describes significant foreign barriers to U.S. exports of goods and services, foreign direct investment, and e-commerce to 59 countries, the European Union, Taiwan, Hong Kong, and the Arab League. It states that trade barriers may be broadly defined as government laws, regulations, policies, or practices that protect domestic goods and services from foreign competition, artificially stimulate exports of particular domestic goods and services, or fail to provide adequate and effective protection of intellectual property rights. These include measures on tariffs, import licensing, digital data flows, customs, agricultural quotas, subsidies, telecommunications services, and more, even when they may be consistent with international trade rules.

The report also highlights efforts to remove barriers to U.S. exports, which in 2019 included the following.

- The U.S.-China phase one trade agreement (1) requires structural reforms and other changes to China’s economic and trade regime in the areas of intellectual property, technology transfer, agriculture, financial services, and currency and foreign exchange and (2) streamlines China’s facility registration procedures to allow imports from more than 2,000 U.S. export facilities of various beef, pork, poultry, and processed meat products, dairy and infant formula products, seafood, animal feed, and distillers dried grains.

- Under the U.S.-Mexico-Canada Agreement, Canada agreed to eliminate milk classes 6 and 7, discriminatory grading of U.S. wheat, and British Columbia’s discriminatory treatment of U.S. wine in grocery stores.

- The European Union (1) approved the use of two hazardous substances in engines for another five years because there are no viable alternatives and (2) agreed to expand access for U.S.-high-quality beef.

- The U.S.-Japan Trade Agreement eliminates many longstanding barriers to agricultural trade and ensures that over 90 percent of U.S. food and agriculture exports have access to Japan on either a duty-free or other preferential basis.

- Taiwan took several steps expected to improve its ability to effectively prosecute cases of trade secrets theft by protecting information from unauthorized disclosure.

- Tunisia agreed to U.S. export certificates to allow imports of U.S. beef, poultry, and egg products.

- Ghana agreed to incorporate U.S. standards into its new automobile standards policy.

- Vietnam (1) rescinded a decree that required lot-by-lot testing for automobiles and replaced it with a new program that requires autos to be tested by model and (2) agreed on phytosanitary conditions for U.S. oranges to be imported into Vietnam.

- Saudi Arabia withdrew a measure requiring mandatory sugar limits for processed food and beverage products that would have severely affected U.S. exports.

- Korea agreed to expand market access for U.S. rice after five years of negotiations.

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