US chief of commerce: The 1962 metal tariff law needs to be modernized

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© Reuters. FILE PHOTO: U.S. Trade Representative Katherine Tai testifies before the Senate Funds Subcommittee on Commerce, Justice, Science, and Allied Agencies during a hearing on the proposed FY 2022 budget for the Office of U.S. Commerce R.

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By David Lawder

WASHINGTON (Reuters) -US Sales Representative Katherine Tai on Wednesday called on Congress to modernize the Cold War-era law former President Donald Trump used to impose tariffs on imported steel and aluminum, and pledged to address longstanding labor rights issues in Mexico.

In a testimony to the Senate Finance Committee, Tai said that Section 232 of the Trade Act 1962 did not make the authorities well suited to the need to protect US steelmakers from foreign competition and that it “upset the US economy.” “and tensions with trading partners intensify.

Section 232 allows tariffs on goods that are considered important to US national security. Tai said the Trump administration and its predecessor, Robert Lighthizer, “did the best they could, given the tools we have in the books.”

Today’s problem in the steel and aluminum industries is largely caused by subsidized overcapacity in China, and new trade instruments are needed to address these challenges.

“I would suggest that we need 2021 tools to meet the challenges of 2021, rather than relying on 1962 tools and retrofitting them for the challenges we have now,” said Tai, adding that the Finance Committee could help level the playing field for new workers.

Tai did not discuss any specific changes to the statute. The European Union threatens to double tariffs on Harley-Davidson (NYSE 🙂 motorcycles, whiskey and motorboats from American production to 50% on June 1st if a transatlantic dispute over steel and aluminum tariffs is not resolved by then.

Tai said she had “constructive talks” with the EU and the UK to eliminate overcapacity in the steel and aluminum sectors and to resolve a longstanding Boeing-Airbus subsidy dispute.

“These talks will take some time, but I believe that a solution is possible and worth following,” said Tai in prepared remarks.

Tai said she will use the new factory-specific labor enforcement regulations of the U.S.-Mexico-Canada trade agreement to address long-standing labor problems in Mexico.

USTR on Wednesday called on the Mexican government to investigate allegations that workers’ rights were denied in a union vote at a General Motors (NYSE 🙂 truck plant in Mexico under the USMCA’s “swift reaction” policy on labor enforcement were.

“This use of the Rapid Reaction Mechanism shows that we will act when workers in certain facilities are denied their rights under laws necessary to meet Mexico’s labor obligations,” said Tai.

She said the USMCA, which replaced the North American Free Trade Agreement of 1994 last year, has “the most comprehensive, enforceable labor and environmental standards of any US trade agreement.”

Tai defended her decision to open World Trade Organization negotiations on surrendering intellectual property rights for COVID-19 vaccines, saying this could turn pharmaceutical companies into “heroes”.

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