The White House steps up trade aggression, calls for 'broader reset' of global tariffs

AP Photo/Evan VucciU.S. Trade Representative Robert Lighthizer speaks in the Eisenhower Executive Office Building on the White House complex in Washington, Monday, May 15, 2017, during his swearing-in ceremony.
  • The Trump administration plans to call for a “broad reset” of World Trade Organisation tariffs in its latest conflict with the global authority.
  • The US levies a mere 3.4% average rate, while the European Union and China charge 5.1% and 10%, respectively, under WTO rule.
  • The organisation’s tariff rates “no longer reflect members’ policy choices and economic conditions,” US trade representative Robert Lighthizer said in prepared remarks seen by Bloomberg.
  • The WTO’s action also prevents “the United States from taking action to address unfair trade practices that hurt US workers,” he said.
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The White House plans to escalate its tensions with the World Trade Organisation by calling for a “broad reset” of its global tariff rates, US trade representative Robert Lighthizer is set to tell House representatives on Wednesday.

The Trump administration has long butted heads with the WTO, repeatedly accusing the organisation of charging unfair duties to US exporters. The White House plans to argue that a reset is needed to level the playing field and bring other developed economies’ rates more in line with the US’s.

“Currently, outdated tariff determinations are locked in place that no longer reflect members’ policy choices and economic conditions,” Lighthizer said in prepared remarks seen by Bloomberg. “Many countries with large and developed economies maintain very high bound tariff rates, far above those levied by the United States.”

The US’s average rate sits at 3.4%, among the world’s lowest. For comparison, the European Union’s is 5.1% and China’s is 10%. India holds the highest, at 51%. The WTO and its tariff policies “created new obligations out of thin air, preventing the United States from taking action to address unfair trade practices that hurt US workers,” the trade representative said.


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Lighthizer is expected to deliver his statement to the House Ways and Means Committee Wednesday afternoon. He will highlight that the US is moving forward in trade talks with the EU, Britain, China, Japan, and Kenya, and that the tariff rate disparity sets the country up for failure when seeking fair deals.

The WTO and its tariff policies “created new obligations out of thin air, preventing the United States from taking action to address unfair trade practices that hurt US workers,” the trade representative said.

The proposed tariff overhaul arrives as the coronavirus pandemic tanks US trade activity. The nation’s goods and services deficit widened to $US49.4 billion in April as manufacturing and global travel froze. US exports tanked 20.5%, its biggest decline in data going back to 1992. Imports posted a record decline of 13.7%.

President Donald Trump campaigned heavily on a desire to boost national trade, yet the combination of the US-China trade war and the coronavirus have all but stifled such hopes.


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