Background

Forced labor, China, and World Trade Organization reform were among the common topics in talks new U.S. Trade Representative Katherine Tai held this week with a number of her foreign counterparts as well as new WTO Director-General Ngozi Okonjo-Iweala. The talks signal that Tai is moving quickly to shore up relations with key trade partners and restore U.S. leadership on global trade issues.

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In calls with trade ministers of the European Union, the United Kingdom, Canada, Mexico, Japan, Korea, and France, there was general agreement to strengthen cooperation on eliminating the use of forced labor in global supply chains. The U.S. has increased its scrutiny of and actions against this issue in recent years, particularly with respect to China, and other countries are beginning to follow suit.

China itself was another common topic as the U.S. seeks to craft a more united front against that country’s troublesome trade policies. Secretary of State Antony Blinken expanded on that idea in a March 24 speech, telling fellow NATO members that “when one of us is coerced” by China “we should respond as allies and work together to reduce our vulnerability by ensuring our economies are more integrated with each other than they are with our principal competitors.” The U.S., the EU, and France also discussed global steel and aluminum overcapacity, which led the U.S. to impose import tariffs on steel and aluminum imports from most countries even though a large part of that overcapacity is generated in China.

WTO reform, including steps that might be taken at the WTO’s upcoming ministerial conference, was a main point of discussion between Tai and Okonjo-Iweala and was included in talks with most of the trade ministers as well. The new WTO chief has signaled her support for improvements but indicated that there is no small amount of disagreement among WTO members about what specific changes should be made.

Full implementation of the U.S.-Mexico-Canada Agreement was a focus of talks with Mexico and Canada, with all three agreeing to pursue a USMCA Free Trade Commission meeting in the near future. Ottawa also emphasized a commitment to keep the “deeply integrated” U.S.-Canada supply chains open and resilient and raised the issue of U.S. tariffs on Canadian softwood lumber and solar products.

While the UK has continued to express interest in a free trade agreement with the U.S., Tai said only that she is reviewing the negotiations that have already taken place and hopes to continue discussions soon. President Biden has said he plans to focus on economic recovery and domestic investment before looking to conclude new trade agreements.

Other topics Tai raised included (1) resolving the U.S.-EU dispute over aircraft subsidies, in which the two sides are currently suspending retaliatory tariffs for four months to allow time for negotiations, (2) ways trade policy can help address climate change and support workers, and (3) cooperative efforts to recover from the COVID-19 pandemic.

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