Even as the Trump Administration imposes tariff hikes on Chinese imports, the prospect of negotiating a new trade agreement, a so-called Phase Two deal, remains on the table. But how realistic is this possibility? What key elements would the United States need to include to make such a deal meaningful? What concessions would China demand in return? And what lessons can we draw from the Phase One negotiations and its implementation to guide this effort? 

On Tuesday, April 22, WITA and the Asia Society Policy Institute hosted a discussion panel addressing all these questions.

Featured Speakers:

Christopher Adams, Senior Advisor, Covington & Burling LLP

Craig Allen, Senior Counselor, The Cohen Group; former President, US-China Business Council

Jeff Gerrish, Partner, Schagrin Associates; former Deputy U.S. Trade Representative for Asia, Europe, the Middle East, and Industrial Competitiveness, Office of the U.S. Trade Representative

Lingling Wei, Reporter, The Wall Street Journal

Moderator: Wendy Cutler, Vice President, Asia Society Policy Institute (ASPI)

Watch the Full Video Here

04/22/2025 | WITA

How to Strike Trade Deals in Record Time

Wendy Cutler, the author of this piece, moderated WITA’s joint event with the Asia Society Policy Institute on April 22, 2025. Learn more here.

U.S. trading partners must have breathed a sigh of relief last week when President Donald Trump announced a 90-day pause on the imposition of tariff rates above 10 percent. However, along with Trump’s economic team, they are quickly realizing that the three-month reprieve, while welcome, is an incredibly short time to hammer out trade deals. Typically, U.S. officials spend at least six months—twice the length of time of the current pause—just to develop their negotiating positions in consultation with Congress and stakeholders. Actual negotiations usually span several years. But as we are learning, these are not normal times.

Countries around the world are scrambling to pull together the best teams and develop strategies, tactics, and substantive offers for a trade negotiation with the United States. The very first thing these countries need to consider is whether they want to push to be at the front of the negotiating queue, a potentially attractive option if they conclude that going early may lead to softer deals. Some may decide that they are better off hanging back and watching how others fare first. This would allow them the opportunity to at least gain a better sense of which negotiating topics (or sweeteners) are of the most importance to the White House and potentially to learn from others’ missteps in this new speed-negotiating world.

Thus far, the Trump administration has referenced a long list of requests of foreign counterparts, including tariff cuts, reductions in trade deficits, increased purchases of U.S. goods, cooperation on countering the China challenge, and much else. Trading partners rightly are now looking for clarity on which of these issues are must-haves, allowing them to focus their efforts on what matters most to the White House during this short window.

Countries are also unclear on whether these negotiations can lead to tariffs below the 10 percent universal rate now in place or whether that rate represents a floor. In addressing this question, Trump indicated last week that there may be some narrow flexibility—but not much. With the recent announcements of special exclusions for phones and other electronic products from the tariff hikes, countries must be more confident now asking for further product exclusions to help their domestic companies weather the tariff storm.

In my recent conversations, foreign trade negotiators have expressed exasperation about making major announcements of U.S. investments or purchases without receiving any credit for these actions in the tariff rates assigned to their countries. To avoid this trap, many are likely to now ascribe to a traditional trade negotiating mantra: Nothing is agreed until everything is agreed.

Read the Full Analysis Here

04/15/2025 | Wendy Cutler | Foreign Policy

US Manufacturing Jobs and Gen Z Workers—Can Common Ground Be Found?

The “make in America” agenda has been leading many of the biggest administrative changes and tariff upfolding right now. As a result, manufacturing jobs are expected to return to the country in the long run, but will Gen Z be willing to take up the work when the time comes? The manufacturing industry is expected to add 3.8 million new jobs to the market by 2033, which will mean a whole variety of trade jobs for Gen Z workers who will soon make up the biggest slice of the workforce.

Boomers will be left to the retirement jobs and positions that best utilize their knowledge and strength while millennials will continue to dominate the corporate world for years to come. As manufacturing jobs begin to present the only opportunities for young workers, some tough choices will have to be made on what is to come.

MANUFACTURING JOBS AND GEN Z: A MATCH MADE IN THE POST-TARIFF ERA

In the last few years, many Gen Zers are shifting away from college education and skipping straight to trade schools and labor work. There are many reasons for the shift. Some Gen Z workers no longer see the value of a college degree as educated workers are often stuck doing jobs that have nothing to do with their intended careers.

College degrees have also been seen as insufficient in actually preparing workers for white collar jobs. These degrees may bless students with textbook-based knowledge, but they haven’t entirely kept up with the times and expanded to provide Gen Zers with the workplace skills they need in a post-pandemic world.

GEN Z WORKERS ARE OPEN TO EXPLORING BLUE-COLLAR JOBS

In the last few years, Gen Z workers have developed a fascination for blue-collar jobs. These jobs have improved the pay and working conditions offered to workers, and in recent years, have also grown to be significantly more flexible. Workers are joining family businesses and starting their own, after embracing the DIY-er spirit and taking matters into their own hands.

Blue-collar work has become popular on social media platforms like TikTok, further inspiring teens to take an interest in building a career in fields like metal work and carpentry. Putting on a neon safety vest and pink rubber boots is now more of a fashion statement than the uncomfortable heels required in the corporate setup, so the shift in approach has been a big one.

Avoiding student loans by skipping college is just another one of the many advantages of switching to blue-collar work. The Gen Z workforce face many issues, but one thing they understand best is working on their own terms and expressing themselves creatively. Many blue-collar jobs offer just that.

Read the Full Article Here

04/21/2025 | Ava Martinez | The HR Digest

How American Business Can Prosper In The New Geopolitical Era

As President Calvin Coolidge said, in so many words, “The business of America is business.” One hundred years later, his words still ring true, as American businesses have a profound impact on American lives and livelihoods. American businesses employ roughly 83 percent of the US labor force, equivalent to about 136 million jobs—nearly half of which belong to small businesses with fewer than 500 employees. And of course, all Americans depend on commerce to supply the goods and services needed for daily life.

For roughly the past 30 years, geopolitics has taken a back seat relative to macroeconomic, strategic, and technological concerns for businesses. But today, a new hurdle looms: 900 executives tell McKinsey that they see geopolitics as the greatest risk to economic growth.

They’re not wrong. Business leaders understand that a reconfiguration of global trade is underway. Consider that the China tariffs imposed by President Trump were expanded by President Biden, and most of China’s retaliatory tariffs remain in place. And in April 2025, new base and reciprocal tariffs are scheduled to take effect on US trading partners. The uncertainty about the tariffs and possible retaliations or negotiations have created one of the greatest levels of peacetime uncertainty for US businesses. The facts speak for themselves: American business is in a new era of geopolitics, with significant implications.

The United States has long been the lynchpin of the global economy. Its economic preeminence in the years and decades to come will rest on a philosophical and opportunistic alignment between government and business, working in parallel to navigate shifts in global politics, economics, trade, and security.

Ten drivers of geopolitical change

As the United States seeks to update the rules of trade, economics, and security, and other nations react, we inevitably face profound uncertainty. Yet, even in the face of this change, business leaders need to seek understanding and act. As US policymakers reconsider and adjust across ten major drivers of geopolitical change, US businesses can bound the uncertainty by understanding the principles guiding potential US policies. Some shifts are intended to encourage a rewiring of the industrial base for national security or reindustrialization, while others are meant to build leverage in negotiations. Understanding the distinction can ensure long-term realignment of corporate investments and operations with government policies, instead of mere tactical, near-term moves to mitigate risks.

Read the Full Article Here

04/23/2025 | Matt Watters, Shubham Singhal & Zoe Fox | McKinsey & Company

WITA – We put the community in trade community.

Information about upcoming WITA and trade community events

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The post WITA’S FRIDAY FOCUS ON TRADE – APRIL 25, 2025 appeared first on WITA.

On Tuesday, April 8, WITA International hosted an in-person panel at the 55th Annual World Trade Centers Association (WTCA) Global Business Forum (GBF) in Marseille, France.

The panel updated attendees about developments in international trade policy and geopolitics. Panelists offered insights on emerging challenges and opportunities shaping the global economy in the year ahead, and the potential impact of those policies on governments, supply chains, businesses and investors.

Featured Speakers:

Remarks by Angela Ellard, Deputy Director General, World Trade Organization

Discussion with:

Ed Allison-Wright, World Trade Center Gibraltar

Iana Dreyer, Founder and Editor of Borderlex

Lionel C. Johnson, President of the Pacific Pension & Investment Institute

Penny Naas, Lead GMF Allied Strategic Competitiveness, German Marshall Fund of the United States

Moderator: Kenneth Levinson, Chief Executive Officer, Washington International Trade Association

Watch the Full Video Here

Note: this in-person panel discussion took place on April 8, one day before President Trump paused his reciprocal tariffs, so some of the discussion points may have been overtaken by events.

04/08/2025 | WITA International

Tariffs: Estimating the Economic Impact of the 2025 Measures and Proposals

Tariffs are taxes imposed by a government on imported goods, typically calculated as a percentage of the import’s value (known as an ad valorem tax). Governments use tariffs for various purposes, such as raising revenue, protecting domestic industries from foreign competition and influencing international trade patterns. By increasing the cost of imported products, tariffs encourage consumers to shift toward domestically produced goods, thus supporting local businesses and potentially stimulating domestic economic activity.

However, the overall impact of tariffs depends critically on how much of this cost increase is passed along to domestic consumers and producers, a concept known as pass-through. Empirical research has found that the pass-through rate is generally high (often near 100 percent), meaning that the burden of tariffs typically falls on domestic consumers and firms rather than foreign exporters.

The economic significance of tariffs is underscored by recent data from the First Quarter 2025 CFO Survey. More than 30 percent of surveyed firms identify trade and tariffs as their most pressing business concern, up sharply from just 8.3 percent in the previous quarter. This rapid rise highlights firms’ heightened sensitivity to tariff-related disruptions, reflecting widespread concern among business leaders about the potential economic consequences of recent tariff proposals.

In this article, we first provide historical context on U.S. tariff policy to frame the significance of the proposed tariff changes for 2025. Next, we analyze how tariffs impact producers differently across industries due to varying reliance on imported inputs. Finally, we examine the specific implications of recent tariff proposals for all counties in the U.S.

A Bit of History on Tariffs

Historically, the U.S. relied heavily on tariffs — often exceeding 30 percent — as its primary source of federal revenue from the nation’s founding until the introduction of income taxes in 1913.

During this early period, these high tariffs also served to protect emerging industries through a strategy called import substitution. After World War II, international trade agreements like the General Agreement on Tariffs and Trade significantly reduced tariffs globally from an average of around 20 percent in 1947 to below 5 percent following the Uruguay Round in 1994. The globalization movement of the 1980s and 1990s further accelerated tariff reductions, culminating in the establishment of the World Trade Organization (WTO) in 1995. Since then, tariffs among WTO member countries have generally remained around 2.5 percent, reinforcing greater global economic interconnectedness.

Read the Full Economic Brief Here

04/02/2025 | Marina Azzimonti, Zach Edwards, Sonya Ravindranath Waddell & Acacia Wyckoff

| Federal Reserve Bank of Richmond

We Never Had Free Trade

On April 2, as he imposed exorbitant tariffs that triggered a stock market collapse, Donald Trump said this: “For decades, our country has been looted, pillaged, raped, and plundered by nations near and far, both friend and foe alike. American steelworkers, autoworkers, farmers, and skilled craftsmen—they really suffered gravely. They watched in anguish as foreign leaders have stolen our jobs, foreign cheaters have ransacked our factories, and foreign scavengers have torn apart our once beautiful American dream.”

Trump’s tariffs, which are more about indiscriminate bullying than trade policy, set off reams of simplistic commentary praising the glory days of free trade. Yet we would do well to remember our history, or we could end up cherishing the kind of corporate globalization whose backlash paved the way for Trump in the first place.

The commentary has compared the recent stock market free fall to the abrupt market crash in the early days of the pandemic. But that’s the wrong comparison. The right comparison is to the last time that the stock market and the economy collapsed due to perverse policies. That would be the collapse of 2008, when the market lost 54 percent of its value.

Those policies included the deliberate wreckage of financial regulation so that insiders could get richer, as well as hyper-globalization. The architect of those policies was Robert Rubin with an assist from his deputy Larry Summers, and it’s instructive to compare Rubin with Trump.

As grifters, Donald Trump and Robert Rubin are two variations on the same theme. Rubin reaped immense personal benefits from financial deregulation and corporate globalization. Moving from Goldman Sachs to the White House to the Treasury and then to Citigroup, he epitomized the self-interested revolving door between Washington and Wall Street. Rubin did it with great politesse, always cloaking his maneuvers as public-mindedness. Trump is more coarse and more crude; the personal grifting is shameless and transparent.

Both versions corrupt democracy. We shouldn’t have to choose between these two forms of the private use of public office. Let’s see which produces more collateral damage for the economy.

Read the Full Article Here

04/08/2025 | Robert Kuttner | The American Prospect

Trump Trade Negotiations: Embrace Strategic Trade, Not Autarky

U.S. trade policy lacks nuance and strategy. Free traders want free trade for everything. Protectionists want protection for everything. Free traders are happy for other countries to subsidize their exports, and if those countries are dumb enough to subsidize American consumption, let ‘em. Protectionists, meanwhile, get riled up if any imports are subsidized.

It’s time to apply a strategic lens to U.S. trade policy. If nations want to subsidize their exports of commodity goods like minerals, lumber, and dairy products—have at it. We’ll take the discount. In contrast, if they want to subsidize exports of advanced goods like semiconductors, steel, and autos—no way. These are predatory moves designed to destroy U.S. capabilities in critical industries permanently.

This Manichaeism runs deep. During the Obama administration, I met with a top White House economist. He had just come from a high-level meeting where an even more senior economist successfully argued that if China wanted to dump solar panels (i.e., sell below costs), they were the dumb ones. The United States should allow it because our consumers would benefit. (That economist’s initials might have been L.S.) He advocated for this because he believed no industry was more important than any other. And so, we lost our solar panel industry.

Now we have a White House that decries all foreign export subsidies and sees all goods-producing industries as equally important.

Neither protectionists nor orthodox free traders fully grasp the essential political economy of international trade. This critical blind spot has profound consequences for policy. It is time to embrace a Hirschmann-oriented trade policy.

Albert O. Hirschmann, in his seminal work National Power and the Structure of Foreign Trade, articulated what many economists overlook: Trade creates power relationships and dependencies between nations that extend far beyond simple economic efficiency. Trade patterns shape geopolitical leverage, vulnerability, and autonomy in ways standard economic models simply cannot capture. And advanced industries play a key role in shaping that power.

Read the Full Blog Here

04/16/2025 | Robert D. Atkinson | Information Technology & Innovation Foundation

Only Trump’s Tariffs Can Fix a Rigged Global Trading System

The international trade system is broken – and Donald Trump’s reciprocal tariff doctrine will fix it. This long-overdue restructuring will make both the US and global economies more resilient and prosperous by restoring fairness and balance to a system rigged against America.

For decades, under the biased rules of the World Trade Organisation, the US has faced systematically higher tariffs from its major trading partners and far more punitive non-tariff barriers.

The result is a national emergency that threatens our economic prosperity and national security.

At the heart of this crisis is a trade deficit in goods that has ballooned to more than $US1 trillion ($1.6 trillion) annually. The economic models of free trade, which predict that chronic trade imbalances will always be eliminated through price adjustments via exchange rates, are dead wrong.

The US cumulative trade deficits in goods from 1976 – the year chronic deficits began – to 2024 have transferred over $US20 trillion of American wealth into foreign hands.

That’s more than 60 per cent of US GDP in 2024. Foreign interests have taken over vast swaths of US farmland, housing, tech companies and even parts of our food supply.

A central driver of this one-sided trade is the WTO’s “most favoured nation” (MFN) rule, which requires member countries to apply the lowest tariff they offer to any one nation to all WTO members. America’s trading partners can maintain high, uniform tariffs across the board – with no incentive to negotiate fairer terms with the US.

Read the Full Opinion Here

04/08/2025 | Peter Navarro | Financial Review

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The post WITA’S FRIDAY FOCUS ON TRADE – APRIL 18, 2025 appeared first on WITA.

The U.S. Trade Representative, Jamieson Greer, testified before the Senate Finance Committee on Tuesday, April 8, and the House Ways & Means Committee, on Wednesday April 9, about the Trump Administration’s 2025 Trade Policy Agenda.

Watch Both Hearings Here

04/08/2025 | U.S. Senate Finance Committee

04/09/2025 | U.S. House Ways & Means Committee

America’s Three Demands

 The following piece includes excerpts from Oren Cass’ blog post, “America’s Three Demands”. Oren Cass will be a featured speaker at WITA’s upcoming “Mini Intensive Trade Seminar: U.S. Tariffs and Responses“, on Wednesday, April 16.

Let’s begin with the premise: The costs to the United States of attempting to maintain the so-called “liberal world order” have come to outweigh the benefits (perhaps they always did). Of course, it was the United States that chose—indeed, largely dictated—the arrangement in the first place. But that does not preclude revisiting those choices as lessons get learned and conditions change. In the emerging multipolar world, in which China will advance its own interests contrary to ours, we can and should ask more of the many allies who would strongly prefer our sphere to China’s. We should treat our allies fairly and respectfully, and our demands should be reasonable, but the time has come to make them. Free access to the American market and partnership with us in national defense should be contingent upon:

1. Balanced Trade. The United States cherishes free markets and welcomes free trade with other market democracies. But the premise of mutually beneficial free trade is that it operates as trade—countries exchanging things they can make and do best for the things others can make and do better. What we will not tolerate is the situation that we have encountered over the past several decades, where things that we once made in the United States move elsewhere:

not because those places have any genuine advantage in the production, and
not because we are making more of something else once made elsewhere instead, but rather
because countries make policy choices to expand their own manufacturing sectors at America’s expense.

Some economists object that trade deficits simply emerge in nature and are no one’s fault, or else that the real fault lies with the United States for running large budget deficits that lead us to borrow from around the world. To be sure, our budget deficit is a problem that we have an obligation to address. But the idea that these other countries don’t want their trade surpluses and have not actively pursued them is absurd. With the United States committed to maintaining the liberal world order and taking bad advice from near-sighted economists, policymakers elsewhere acted secure in the knowledge that we would do nothing to stop them…

2. Burden Owning. The extent to which U.S. allies have under-invested in their own defense capabilities, and relied instead upon the United States to lead and underwrite all military actions and deterrence around the world, should be deeply humiliating to them. But mostly, it is deeply humiliating to us. We accuse those nations of being “naïve” in their failure to maintain adequate defense, but they have been laughing all the way to the bank, or at least all the way to the more generous social welfare spending they can afford as a result. The United States has been the naïve one, having compliantly footed the bill year after year, its exhortations for greater burden sharing having elicited only smirks…

3. China Out. The third requirement of participation in a U.S.-led economic and security alliance should be the maintenance of a collective perimeter that excludes China. Partners should agree on common tariff barriers, investment restrictions, export controls, and immigration policies. As AI-dominated information networks continue to develop, the technology ecosystem of the free world may also need to be kept apart from the Chinese-dominated one.

Read the Full Blog Post Here

03/31/2025 | Oren Cass | Understanding America

Trump’s Use of Emergency Powers to Impose Tariffs Is an Abuse of Power

Jennifer Hillman will be a featured speaker at WITA’s upcoming “Mini Intensive Trade Seminar: U.S. Tariffs and Responses“, on Wednesday, April 16.

In an unprecedented move, President Trump justified the imposition of tariffs on Canada. China, and Mexico under the International Emergency Economic Powers Act (IEEPA) based on an “extraordinary threat” from illegal immigration and drug trafficking. The problem for the president, however, is that IEEPA does not explicitly grant tariff authority at all—indeed, the words “duty” or “tariff” appear nowhere in the statute—and to the extent that it grants power to restrict imports, it requires that there be a direct connection between the action taken (here, broad-based tariffs) and a properly declared national emergency (here, migrants and fentanyl crossing the southern border). But there is no direct connection between tariffs on imports of all goods—no matter how innocent or far removed from fentanyl—and the declared national emergency.

The president’s initial move to impose IEEPA-based tariffs came on Feb. 1, with 10 percent tariffs announced on all goods from China and 25 percent on all goods from Mexico and all goods other than energy products (which were subject to a 10 percent duty) from Canada. The president subsequently paused their application to imports from Canada and Mexico but increased the tariffs to 20 percent on all goods from China. On March 3, he proceeded with the 25 percent tariffs on Mexico and Canada (10 percent on energy products), only to further pause those additional tariffs on Mexico and Canada for any goods meeting the United States-Mexico-Canada Agreement (USMCA) rules of origin. He has also threatened additional IEEPA tariffs on a wide range of products, including cars, semiconductors, and oil, as well as on imports from various other countries. China has responded with retaliatory measures and initiated dispute settlement proceedings at the World Trade Organization. Similarly, Canada responded with tariffs of 25 percent on $155 billion of American goods.

IEEPA has never been used to impose tariffs. Congress enacted IEEPA nearly 50 years ago to give the president the power to act promptly to protect the nation’s security. Although this delegation grants the president broad discretion, it was not meant to provide him with a blank check on trade policy. The U.S. Constitution gives Congress the sole power to regulate foreign commerce and impose tariffs. The president’s powers can thus come only from authority that Congress expressly delegated. This begs the question: Did Congress clearly intend to hand over its tariff authority to the president or to permit him to exercise it in such a sweeping and procedurally skimpy manner? The answer is no, especially without establishing a clear relationship to a particular national emergency.

Read the Full Article Here

03/24/2025 | Jennifer Hillman | The Lawfare Institute

Will Trump’s Tariffs Be Good for Auto Workers?

Following are excerpts:

My union’s hope—after the U.S. lost 682,000 jobs because of NAFTA—is that punitive tariffs will incentivize domestic production and build the U.S. manufacturing base. “With these tariffs, thousands of good-paying blue collar auto jobs could be brought back to working-class communities across the United States within a matter of months,” said UAW President Shawn Fain in a statement.

Fain later clarified on CBS’s “Face the Nation” that building a new plant could take years, but he said tariffs could be a “motivator” to bulk jobs back up where companies have eliminated shifts, like at the Volkswagen plant in Tennessee, where the union is negotiating a first contract. At Stellantis, Fain said, the company could bring 2,000 jobs that were lost when it shifted production of the Ram truck to Mexico.

In bargaining there’s a truism that if the company doesn’t give it to you in writing, then don’t believe it. These tariffs promise exactly zero new factories will be built, but a couple things are certain: vehicle prices will go up, perhaps by as much as $6,400, because auto companies will pass on any tariff costs to car buyers; and production will be disrupted due to decreased sales and logistical wrangling, which likely means layoffs. Michigan could be hit hardest….

A Better Way

Every worker in the industrial Midwest can see that “free trade” has been a disaster for us. Town after town, whole sections of our states are hollowed-out husks of their former selves. Deaths of despair are commonplace where prosperity once flourished.

I can completely understand the desire to protect our industries and our communities. But I can also understand that our neighbors to the north and south have that same desire.

My proposal would be to tax or tariff only those vehicles and parts (both domestic and foreign) that are produced in facilities that violate workers’ rights. This approach would defend the good union jobs that are the backbone of our families and communities, and build solidarity with our union brothers and sisters overseas. It would also offer an incentive for nonunion companies to finally respect the rights of their employees to collectively bargain.

This kind of explicitly pro-worker tariff policy clearly isn’t in the cards under this administration, but it’s something to consider as a future political goal now that the taboo around tariffs has been broken. Coupled with a strong international solidarity movement between the U.S., Mexico, and Canada, it would give us more power and leverage than ever. Just as large corporations are global, our solidarity has to span borders to match their sphere of control over production and our lives.

Read the Full Viewpoint

04/02/2025 | Sean Crawford | Labornotes

The Road to a New European Automotive Strategy: Trade & Industrial Policy Options

The European automotive industry stands at a crossroads, facing three concurrent challenges: decarbonizing to tackle climate change, maintaining global competitiveness in a fierce market, and safeguarding economic security amid rising geopolitical tensions. At the heart of the European economy, the automotive sector directly employs 1.4 million people and supports 13 million jobs indirectly across the EU, with implications extending far beyond the industry itself. The transition from internal combustion engine vehicles (ICEs) to electric vehicles (EVs) presents profound challenges, as structural adjustments to production processes and supply chains will significantly affect European employment and economic prospects.

The EU has established a legislative framework for transport sector decarbonization, and the automotive industry has invested substantially in this transition. However, evolving market conditions have created a trilemma of competing objectives: decarbonization, competitiveness, and economic security. Successfully navigating this transition requires a unified yet adaptable European strategy that addresses trade-offs between the objectives, balances short-term priorities with medium- and long-term investments, and coordinates action between private and public sectors.

Each aspect of the trilemma presents both opportunities and challenges for the automotive sector, its supply chain, and the broader European economy. Addressing these issues comprehensively will require coordinated international trade and industrial policies.

The EU aims to achieve 100% zero-emission mobility for all new vehicles by 2035, in line with its commitment to climate neutrality by 2050. This target requires substantial investment in EV infrastructure, battery production, and consumer incentives. However, EV adoption rates vary significantly across member states, creating an uneven transition.

Key challenges include high costs and consumer hesitancy. EVs remain significantly more expensive than comparable ICEs, limiting widespread adoption. Inadequate charging infrastructure and high electricity prices create additional barriers. Europe must also scale up battery production to compete with China’s dominance of the global battery supply chain.

Read the Full Report Here

01/27/2025 | Victor do Prado, Elvire Fabry, Arancha González Laya, Nicolas Köhler-Suzuki, Pascal Lamy & Sophia Praetorius | Jacques Delors Institute

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The post WITA’S FRIDAY FOCUS ON TRADE – APRIL 11, 2025 appeared first on WITA.

Ten years ago, WITA assumed management of the website, AmericasTradePolicy dot com. The site was originally launched by Bill Krist at the Woodrow Wilson Center for Scholars, and this article by Bill was the first piece we posted on the site, which is now part of www.wita.org

Eighty four years ago on this day President Hoover signed the now-infamous Smoot-Hawley tariff bill, which substantially raised U.S. tariffs on some 890 products. Other countries retaliated and world trade shrank enormously; by the end of 1934 world trade had plummeted some 66 percent from the 1929 level.

The Tariff Act of 1930 (aka the Smoot-Hawley Tariff Act), started out as a bill that would only raise tariffs on some agricultural products, but a host of other special interests piled on and before the legislation finally reached President Hoover’s desk it represented one of the largest tariff increases in U.S. history.

On June 16, 1930 when the Smoot-Hawley bill was signed into law the broad economy was just starting to slip into the Great Depression. Two years later unemployment had reached almost 24 percent in the U.S., more than 5000 banks had failed, and hundreds of thousands were homeless and living in shanty towns called “Hoovervilles”. Our economic woes spread around the world, although other countries weren’t hit as hard; while our unemployment rate increased some 600%, unemployment in Great Britain rose some 130% and over 200% in France and Germany.

Did the Smoot-Hawley tariff act cause the Great Depression? Let’s look first at some other possible causes often cited by economists.

One possible cause, of course, is the stock market crash that had begun in the last week of October 1929, some eight months before Hoover signed the Smoot-Hawley tariff. The Dow had plummeted from 326 on October 22 to 230 in the next six trading days and it finally settled at a low of 41 in July 1932.

Some economists argue that the stock market collapse was caused by overproduction in the 1920s. During World War I a number of countries, including the U.S., had greatly expanded agricultural production; as Europe recovered from the war and its agriculture production reached earlier levels, production worldwide exceeded consumption and prices fell around the world. Farmers had gone into debt during the boom times, investing in new equipment and land, and were hard hit when prices fell.

On March 14, 2025, Secretary of State Marco Rubio issued a memorandum in the Federal Register that all agency actions involving trade, specifically “the transfer of goods, services, data, technology, and other items across the borders of the United States” are “foreign affairs functions,” and thus are exempt from the Administrative Procedure Act (APA). Enacted in 1946, the APA governs how federal agencies can issue regulations. The APA establishes specific procedures, such as a public comment period, that federal agencies must follow when they engage in administrative action, such as issuing new rules and regulations, adjudication of licenses, or interpretation of existing regulations. In addition, the APA provides standards for judicial review of an agency action, enabling courts to strike down actions if they find that their substance or procedural history fails to meet APA standards.  However, the APA excludes certain agency functions from its procedural requirements and judicial standards, including actions involving “military or foreign affairs functions” under Title 5, Sections 553(a)(1) and 554 (a)(4) of the U.S. Code. In short, the Rubio memorandum is an effort to protect most of President Trump’s actions on trade, illegal immigration, export controls, artificial intelligence, and espionage from procedural requirements and judicial review by pulling these under the umbrella of the “foreign affairs” exception.  Doing so would insulate the administration from having trade-related agency actions struck down in the courts because of “process fouls”—procedural errors in conducting an agency action. For example, agency actions involving trade would no longer be exposed to potential “arbitrary and capricious” claims under Title 5, Section 706, of the U.S. Code, which allow courts to strike down agency actions that are arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law. In other words, agency actions can be struck down when they are so far-fetched that they appear to lack any reasonable basis, do not consider relevant factors, or demonstrate a clear error of judgment. Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 416 (1971). These agency actions would still remain subject to tests of constitutionality or compliance with applicable laws. The first Trump administration frequently ran into process fouls, and so far, the new administration gives every sign of having the same problem. In its first two months, the administration has already run into a burst of unfavorable court rulings. Given the administration’s focus on implementing new trade actions with respect to China, Mexico, Canada, and others, it is unsurprising that it would take steps to shield these actions from judicial challenges. Still, the Rubio memorandum raises the question of whether existing trade laws are, in fact, subject to the APA, and, if so, whether the secretary’s memo will make any difference. The short answer is that some trade laws are subject to the APA, and some are not. It is not clear whether the memo would force any significant changes.

The March 2025 edition examines tariffs and their impact on global trade. As an important trade policy tool, tariffs serve as a mechanism to protect domestic industries and generate government revenue. However, high import duties can increase costs for businesses and consumers, potentially stifling economic growth and competitiveness. Policymakers must strike a balance between leveraging tariffs for economic development and integrating into the global economy through trade liberalization. The report also presents new trade data and projections across regions, industries and sectors, covering 2024 and early 2025. While global trade reached a record $33 trillion last year, the outlook for 2025 remains uncertain. Key takeaways on tariffs Today, about two-thirds of international trade occurs without tariffs, either because countries have chosen to reduce duties under most-favoured-nation (MFN) treatment or through other trade agreements. However, tariff levels applied to the remainder of international trade are often very high, with significant differences across sectors. Agriculture remains highly protected, manufacturing still encounters trade barriers in key industries, while raw materials generally benefit from low tariffs. Developing countries face higher duties that limit market access. Agricultural exports from these nations face import duties averaging almost 20% under (MFN) treatment. Meanwhile, textiles and apparel remain subject to some of the highest tariff rates (import duties average close to 6%), limiting developing countries’ competitiveness in these industries. South-South trade (trade between developing countries) still faces high tariffs. For example, trade between Latin America and South Asia faces an average tariff of about 15%. Tariff escalation discourages developing economies from exporting value-added goods, hindering industrialization. This refers to the practice of applying higher tariffs on finished goods than on raw materials or intermediate inputs. Designed to protect domestic industries, this tariff structure also discourages manufacturing in countries that produce raw materials, creating a disincentive to move up the value chain.

Trump’s upcoming tariff barrage is supposed to reduce trade deficits by cutting out imports. Forgotten amid all the administration’s threats and justifications is the other side of the trade equation. More exports not only reduce deficits but also bring broader economic benefits through higher-paying jobs and greater innovation. Yet in a world of global supply chains, boosting exports means upping imports as well. Widespread tariff hikes will also hold back US-based exporters. The US is not a big trader. Just a fourth of its economy comes from international exchanges, far behind other OECD countries, in which trade averages closer to two-thirds of total economic output. And unlike in most other nations, trade’s importance in the US economy has been falling in recent years. Still, the US sells some $3 trillion a year worth of goods and services to the world, supporting roughly 10 million US jobs. It is a major commodity exporter, selling nearly $700 billion in oil, gas and coal as well as grains, soybeans, meat and more every year. It also sells more than a trillion dollars annually in high-end services abroad, including software, advertising, movies and airline flights that ferry tens of millions of global travelers. International sales present big growth opportunities for US-based companies and workers. While US economic growth has recently outpaced other high-income countries and even many emerging economies, the US customer base is just 4% of the globe’s population. And the next billion newly minted middle class will live elsewhere — mostly in Asia. Whether growing food, building planes or creating online games, companies that cater only to the domestic market have a limited runway for future growth. Moreover, export-oriented jobs, particularly those in manufacturing, tend to pay more. According to the US International Trade Commission, workers in export industries earn 16% more than their domestically-oriented counterparts. And export-oriented operations tend to create more job opportunities than domestically focused industries.

This piece at Americas Quarterly includes reactions to President Trump’s tariffs announcements on April 2. Sergio Luna Luna is an economist from UNAM with an M.Sc and Ph.D. in economics from the University of London. He’s Grupo Financiero Mifel’s chief economist. There’s a big sigh of relief south of the border. With “reciprocal tariffs” meaning a hefty 34% for China, 20% for the EU, and a 10% baseline tariff, keeping Mexico and Canada at “just” 25% tariffs on import content not covered by the USMCA has everyone in Mexico talking about the benefits of trade diversion (although no one uses that word). The foreign exchange market seems to concur, as it ended “Liberation Day” with the Mexican peso as the third-best performer vs. the U.S. dollar. My back of the envelope calculation is that the weighted tariff for motor vehicles crossing from Mexico to the U.S. will rise from 0.6% to 6%. Agro-industrial exports (already more prominent than oil & mining exports at 9.4% of the total) should be little affected since, apparently, we go back to the definition of regional – rather than U.S. – content rules for USMCA qualification. In the case of electronic goods, calculations are more complicated but since only about 37% of their export value is local content, the tariff increase should be higher. Still, it should compare favorably with that applied to ASEAN countries, for instance. Antonio Ortiz-Mena CEO of AOM Advisors, Adjunct Professor of International Economic Relations at Georgetown University’s Walsh School of Foreign Service and Chair of the Mexican Foreign Trade Council (COMCE)‘s USMCA Committee. The U.S. has implemented tariffs on a wide range of imports from its trade partners, with some exceptions for goods that comply with the USMCA agreement. These tariffs aim to strengthen the U.S.’s position in the global economy, protect American workers, and promote domestic production of certain goods. Additionally, the tariffs are intended to reduce the U.S. trade deficit and generate revenue that could help offset the expected loss in tax revenue due to anticipated domestic tax cuts. Given the complexity and scale of these measures, it will take months—or even years—before their full impact becomes clear. However, several potential outcomes can be anticipated. One possibility is that the U.S.’s trade partners will respond by reducing some tariffs and non-tariff barriers that currently restrict U.S. exports. In turn, the U.S. may then reduce its own tariffs, leading to more open and reciprocal trade. While this scenario remains plausible, another potential outcome is that some countries might challenge the legitimacy of unilateral tariff increases, either at the World Trade Organization (WTO) or through regional trade agreements. In response, these countries might impose higher tariffs on U.S. exports, especially impacting the U.S. agricultural and services sectors. Such retaliatory measures could undermine the U.S.’s goal of reducing its trade deficit. Luíza Pinese Pinese is an economist focused on balance of payments analysis for the macroeconomics team at XP Investimentos in São Paulo. President Trump’s tariff decision was based on the overall trade deficits the United States runs with each trading partner, rather than the effective tariff imposed on specific products. Given that Brazil maintains a roughly balanced trade position with the U.S., it was assigned just the baseline 10% additional tariff. That was a better-than-expected outcome. The market reaction in Brazil has been quite positive, reflecting a sense of relief and that Brazil could be a relative “winner” in the global trade war (more below). That said, Brazilian exports to the United States are expected to decline in absolute terms, as some products may be replaced by U.S.-made alternatives. From a macroeconomic perspective, the direct effect is likely to be limited. Exports account for some 18% of Brazil’s GDP, and sales to the U.S. represent about 12% of total exports—thus, 2.2% of GDP. However, on the microeconomic level, the consequences may be more significant, especially in sectors where the U.S. is a dominant buyer, such as iron and steel, aircraft, and ethanol.

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In response to the Donald Trump administration’s second-term tariffs, Canada, China, Mexico, and the European Union (EU)—the United States’ largest trade partners—have announced or threatened retaliatory tariffs.

How do retaliatory tariffs work?

A tariff is a tax on foreign-made goods, which makes them more expensive to import. To get a better idea of how retaliatory tariffs could affect the United States, let’s look at what happened to American soybean farmers during Trump’s first term. Soybeans are the United States’ largest agricultural export to China.

In 2017, U.S. soybean exports to China totaled $12 billion, near an all-time high. Then in 2018, the United States placed tariffs on $34 billion worth of Chinese non-agricultural goods, and China retaliated with tariffs on U.S. soybeans and other products. Soybean exports to China plummeted, with U.S. farmers suffering substantial losses.

U.S. farmers’ losses were Brazilian farmers’ gains. Brazil, the world’s leading soybean producer, increased soybean exports to China and has remained its top supplier.

U.S. soybean exports to China recovered after the two countries signed a trade deal in 2020 but have declined somewhat in recent years as China has sought to become less reliant on imported soy.

From 2018 to 2019, U.S. farmers suffered $26 billion in losses due to China’s retaliatory tariffs. In response, the Trump administration provided $28 billion in bailouts to farmers across the two years…

…How could these retaliatory tariffs hurt the United States?

U.S. exports, specifically from the agriculture and livestock sectors, will decline in the short term as trade partners reduce their imports. U.S. producers will suffer from decreased revenue—as U.S. soybean farmers did during the 2018–19 trade war—while other countries will seek to fill the gap left by the United States. Soybean farmers have still not fully regained their market share of soybean exports to China.

Retaliatory tariffs could also result in an escalation of existing U.S. tariffs, hurting consumers as businesses pass on the costs of tariffs in the form of higher prices. The average U.S. household is already expected to face a cost increase of more than $1,200 per year as a result of existing U.S. tariffs. The imposition of retaliatory tariffs also raises other concerns, including the potential effects on the U.S. stock market and allies’ declining trust in U.S. economic leadership.

Read the Full Article Here

03/21/2025 | Christopher Shim & Will Merrow | Council on Foreign Relations

Brussels Hold’em: European Cards Against Trumpian Coercion

At the card table

“The European Union”, posted Donald Trump on his Truth Social account on March 13th, is “one of the most hostile and abusive taxing and tariffing authorities in the world”. For good measure, the US president added that the EU “was formed for the sole purpose of taking advantage of the United States”. The broadside was just the latest reminder that his administration’s trade wars against Canada, China and Mexico are heading Europe’s way, too. Already its 25% levy on steel and aluminium imports has hit the EU. At the time of writing, there appears to be a significant chance of Trump going far beyond these with sweeping multi-sectoral tariffs.

This is part of a wider story. The second Trump administration has challenged Europe’s territorial sovereignty (by threatening to annex Greenland), its digital model (by attacking its technology regulations), and its traditional political party systems (by courting radical European political forces). The president’s approach to America’s supposed allies on the continent evokes less a sober “strategic rebalancing” than the Ming dynasty’s tributary system, with European leaders expected to kowtow to the emperor in Washington. Trump also appears inclined to pressure Ukraine and its European backers into a peace deal favourable to Russia, and to withdraw significant parts of America’s security commitments on the continent.

The president has implicitly revealed why he thinks he can push Europe around like this. In a comment during his hectoring encounter with Volodymyr Zelensky in the White House on February 28th, Trump told his Ukrainian counterpart: “You don’t have the cards.” Cards are Trump’s euphemism for power and leverage. And to the extent that the American president is capable of threatening Europe across a series of fronts, this is a function of the cards he holds and his willingness to play them aggressively. In other words: Trump seeks to exploit Europe’s economic, technological, political and security vulnerabilities for coercive ends.

Europeans need to learn quickly how to play cards. They must assess the hand they have—Europe’s own sources of leverage over Trump and Trump’s America—and how to strengthen that hand. They must develop a clear and realistic plan of what they want to achieve in the transatlantic game of poker that is likely only just beginning. Where do they want to remain aligned with the US? Where do they want to rebalance the relationship? And where do they want to break from America? Then, Europeans will need to play their hand cannily in pursuit of those ends.

The first step in this process is to review that European hand of cards, what it would mean to play them and how Europeans should proceed with such decision making. Providing that review is the purpose of this policy brief.

Read the Full Policy Brief Here

03/20/2025 | Tobias Gehrke | European Council on Foreign Relations

How U.S. Tariffs on China Might Bolster Other Asian Economies

Trump has pledged far-reaching tariffs on Chinese imports, promising upwards of 60 percent on its goods. He has falsely claimed that these tariffs would punish Chinese manufacturing, but in reality, tariffs are often felt by the consumer.

Businesses and individual consumers are already stockpiling and preparing for increased prices, but once these tariffs are underway, where will manufacturing go? Many Chinese businesses are turning to neighboring regions. They now stand to gain major economic advantages if President Trump’s promised tariffs are implemented.

Tariffs are Taxes

While Trump has often said that tariffs are paid by the foreign manufacturer, that is not the case. A tariff is simply a tax on goods manufactured abroad. To simplify, under Trump’s plan, a Chinese product priced at $100 would face a 60 percent tariff upon arrival at the U.S. border. This means the American company receiving the product pays $60 to the U.S. Treasury. Thus, China receives $100 for the product, the U.S. government gets $60 for the tariff, and the business pays $160 total.

Companies then have a choice—they can pay the cost of the tariff and keep prices for consumers the same, increase the price by a percentage of the tariff to make some of the money back, or increase the price enough to cover the entire cost of the tariff. More often than not, they increase the cost to cover part, if not all, of the tariff.

In addition to the unintended consequences Trump’s tariffs will have on domestic consumers, his policies may also impact the economies of countries surrounding China. As American companies weigh their options for domestic or foreign manufacturing, Vietnam, Malaysia, and Kazakhstan stand to gain significantly if further tariffs are imposed on China.

The Impact on China and Surrounding Countries

Beijing’s response to trade shocks has been bolstered in recent years by implementing proportionate tariff increases and building relationships with surrounding nations. While the Chinese government tries to mitigate any potential impacts of the tariffs, many Chinese companies seek to set up shop elsewhere. This could have the intended consequence Trump is ultimately hoping for: to weaken China’s economy. But with Chinese businesses hoping to move away, countries like Vietnam, Malaysia, and Kazakhstan have a lot to gain by welcoming them with open arms.

Vietnam seems the most likely relocation for Chinese business given their positive trade relations with the U.S. The U.S.-Vietnam commercial relationship has flourished since the normalization of ties in the mid-1990s, making the U.S. Vietnam’s largest export market and a key source of foreign investment. Economic reforms (Doi Moi, in Vietnam) and Vietnam’s integration into global markets, marked by its entry into the World Trade Organization (WTO) in 2007, have driven remarkable progress—bilateral trade has surged from $2.9 billion in 2002 to over $139 billion in 2022. Vietnam is a rising star among Asia’s economies as it benefits from shifting global supply chains. It also stands as a growing market for U.S. agricultural exports, solidifying its role in regional trade and investment opportunities. Vietnam’s manufacturing wing and Chinese businesses have a lot to gain from these transitions.

Read the Full Blog Here

03/25/2025 | Tatyana Masters | The International Affairs Review

TDM Insight: Vietnam Boosts Imports from China

Vietnam Pivots Back to Asia

Vietnam, one of the world’s most dynamic economies, now faces one of its most important challenges of this century as it faces protectionist headwinds and tepid consumer economies in the U.S. and Europe.

So far, its formidable export-based economy has seemed up to the task. In 2024, overall exports rose 14.3% year-to-year to $405.5 billion. The part of that from foreign direct investment increased 12.4% to $289.2 billion.

Vietnam’s coping strategy, according to an analysis by Trade Data Monitor, has been to turn more toward its prosperous ASEAN partners and China. In 2024, Vietnam increased imports from China a whopping 30.2% to $144 billion.

After the first Trump administration imposed hefty tariffs on Chinese imports in 2018, U.S. and Europe-based consumer goods firms moved or shifted parts of their manufacturing supply chains to Vietnam. It was a boon for the formerly war-torn nation, which promptly build a network of new economic zones, deep-water ports, rail lines and roads. After the 2018 duties, Vietnam’s gross domestic product grew by around 8% a year. In 2024, it expanded by 7.1%. A modern economic export miracle.

According to U.S. trade statistics, in 2024 Vietnam had the third biggest trade surplus ($123.5 billion) with the U.S., after only China ($295.4 billion), Mexico ($171.8 billion), and followed by Ireland ($86.7 billion) and Germany ($84.8 billion).

Now as the U.S. faces protectionist sentiment and economic uncertainty, Vietnam must prepare for an adjustment, and it will be essential to diversify export markets. An analysis by TDM suggests that Vietnam possesses the capacity to find new markets for its exports and diversify fruitfully.

The Asian Connection

Vietnam is tightly networked with its Asian neighbors. Seven of the country’s top ten sources of imports are Asian: China, South Korea, the U.S., Japan, Taiwan, Thailand, Indonesia, Malaysia, Australia, and Kuwait.

In 2024, shipments from South Korea nudged up 6.5% to $55.9 billion. By comparison, purchases from the U.S. rose 9.3% to $15.1 billion. Surprisingly, Japan is still the fourth biggest supplier of goods to Vietnam, although it is slipping. In 2024, Vietnam imported $21.6 billion from Japan, down 0.2% compared to 2023. Almost all of Vietnam’s imports from Kuwait were energy-related. In 2024, Vietnam shipped in $7.3 billion, up 23.3% over 2024, from the Middle Eastern nation.

But China was not yet Vietnam’s biggest export market in 2024. That would be the U.S. Vietnam shipped $119.5 billon of goods to the U.S. in 2024, up 23.2% from 2023. China was second, buying $61.2 billion worth of goods, flat compared to 2023. Vietnam’s next biggest exports markets were South Korea, Japan, the Netherlands, Singapore, India, the UK, Germany, and Thailand.

Read the Full Insight Here

03/28/2025 | John W. Miller | Trade Data Monitor

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Since the U.S.-Mexico Canada Agreement entered into force in 2020 during President Trump’s first term, companies in the three countries have re-oriented their supply chains to meet the demands of the agreement.

Recent and potential actions taken by the United States, Canada and Mexico could upend North American supply chains, and have impacts on the North American economy that go beyond just the cost of the tariffs that may be imposed by the three countries.

On Tuesday, March 18, WITA hosted a webinar to discuss the real world impacts of these actions on trade and commerce in North America.

Featured Speakers:

Shannon Fura, Page Fura, P.C., and Immediate Past Chair of the National Association of Foreign Trade Zones.

Turenna Ramírez, Partner, Holland & Knight Mexico SC

Valerie Romero, Executive Vice President, Oremor Automotive Group (Ontario, CA); Chair, American International Automobile Dealers Association (AIADA)

Mark Shiring, CEO, Air Technology/Americas, ebm-papst Group

Laurie Tannous, Vice President Government Relations, Farrow; Chair, Canada US Business Association (CUSBA)

Moderator: Andrew Rudman, Senior Associate (non-resident), CSIS Latin America Program

Watch the Full Event Video Here

03/18/2025 | WITA

Event Video: Setting the Table on National Agriculture Trade Day

On Wednesday, March 19, WITA, the Clayton Yeutter Institute at the University of Nebraska, and the Agriculture Trade Education Council on National Agriculture Trade Day hosted a Zoom webinar on trade and agriculture.

Panelists discussed the current trade landscape and future outlook of U.S. agricultural trade, including its place in relation to the overall U.S. economy, food production, global markets, tariffs and trade barriers, and challenges faced by importers and exporters.

Featured Speakers:

Jordan Dux, Senior Director of National Affairs, Nebraska Farm Bureau

Joseph Glauber, Research Fellow Emeritus, International Food Policy Research Institute

Virginia Houston, Director of Government Affairs, American Soybean Association

Tom Madrecki, Vice President, Supply Chain Resiliency, Consumer Brands Association

Moderator: Darci Vetter, Principal, Sower Strategies, LLC; former Chief Agricultural Negotiator, Office of the U.S. Trade Representative

Watch the Full Event Video Here

03/19/2025 | WITA

What Beijing Wants From a US-China Trade War

Since coming into office, the Trump administration has twice increased tariffs on Chinese imports into the United States by 10%, ostensibly because of China’s outsized role in supplying fentanyl precursors to the United States. Beijing has swiftly responded with a mélange of coordinated retaliatory measures—including imposing export controls on critical minerals, levying tariffs on U.S. agricultural products, putting U.S. companies on China’s unreliable entities list, announcing investigations into other U.S. firms, and filing suit at the World Trade Organization (WTO). Taken together, China’s responses seem designed to demonstrate resolve while not foreclosing the prospect of negotiations with the Trump administration.

What does China want?

As this tit-for-tat cycle continues, the most alarming outcome for Washington is not an escalation that pushes the relationship over the precipice. Beijing does not want that—and more importantly, President Donald Trump, U.S. businesses, and U.S. consumers do not want that either. Counterintuitively, the most dangerous outcome is a negotiation that ends in a “grand bargain” that goes beyond trade issues to encompass technology and security issues. Beijing’s overriding goal is for the United States to stay out of its way as it accrues power, wealth, and influence. In the negotiations that are likely to ensue in this trade war, Beijing would likely have three tiers of issues on which it would seek a rollback of competitive U.S. policies that have been at the heart of both the first Trump administration’s and then the Biden administration’s China policies.

First, Beijing would likely seek to loosen the scrutiny of China’s investments into the United States that intensified during the first Trump administration, and of the restrictions on U.S. investments into China put in place by the Biden administration. Beijing wants to go “back to the future” of the Obama years when two-way foreign direct investment spiked.

Second, Beijing would likely table trade-adjacent issues by seeking a rollback of the technology restrictions that the first Trump administration imposed on China and then the Biden administration expanded and systematized. Even with those restrictions in place, Chinese companies like DeepSeek are still challenging the U.S. lead on crucial technologies like artificial intelligence, demonstrating China’s formidability and resilience as a competitor even in the face of its economic slowdown.

Third, since Beijing’s goal is to get the United States out of China’s way, Beijing could look to make progress on its long-standing objective of undermining U.S. security commitments in the region, especially in contested areas like the Taiwan Strait and the South China Sea. Beijing may calculate that it can appeal to Trump’s enduring suspicion of U.S. security commitments to get him to trade away U.S. pledges to defend partners in return for Chinese promises of future economic actions.

Read the Full Commentary Here

03/12/2025 | Jonathan A. Czin | The Brookings Institution

How a Trade War with China Benefits U.S. Companies

For decades, China has been crucial to U.S. companies, both as a source of revenue growth and as a means of reducing the cost of goods. However, U.S. companies trying to access its growing consumer market have faced trade policies that compelled them to offer concessions and share intellectual property (IP) with local joint venture partners.

As U.S. companies launched programs to move manufacturing to low-wage countries, China-based suppliers became an integral part of their supply chains. While the two powerhouse economies became more interdependent than ever, the U.S. trade deficit grew at a compound annual growth rate of almost 5 percent over the last 20 years. This sustained growth led to a substantial trade imbalance, reaching around US$380 billion per year by the early 2020s.

As U.S. policymakers debate ways to address China’s global political influence, trade with China has become a complex issue involving not just political and national security dimensions but also one that involves the economic interests of large U.S. companies…

…The Role Of Tariffs

In 2018, the Trump administration imposed Section 301 tariffs on approximately $50 billion worth of Chinese imports, targeting sectors like electronics, machinery, aerospace and IT. These tariffs followed a U.S. trade representative investigation that found China guilty of unfair trade practices, including IP theft and forced technology transfers. China retaliated with tariffs on U.S. agricultural products, causing market volatility and uncertainty.

Although politically significant, this tariff escalation was a missed opportunity for the U.S. and China to foster fairer trade practices. Evidence suggests that companies advocating for equitable trade practices, rather than relying on protectionist tariffs, often appear stronger.

Consider Tesla’s experience in China. In 2020, China accounted for approximately 22 percent of Tesla’s global revenue, with the company’s sales growing at a robust 33 percent year over year. However, Tesla’s market share in China dropped from 10 percent to 6.5 percent, largely due to fierce competition from local electric vehicle (EV) manufacturers. Instead of seeking tariff protection, Tesla responded to this competitive pressure by ramping up production of an upgraded Model 3, specifically tailored to the Chinese market.

In the broader context of the U.S.-China trade war, Tesla’s experience highlights a critical point: While tariffs may offer short-term political leverage, a more forward-looking approach prioritizes creating transparent policies that promote fair trade competition and innovation across borders. This would not only help U.S. companies but also contribute to a more stable and prosperous global economy.

Read the Full Article Here

03/17/2025 | Aditya Jain | Institute for Supply Management

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Washington (March 12, 2025) – The Board of Directors of the Washington International Trade Association (WITA) is pleased to announce that it has elected Nasim Fussell as the new Chair of WITA’s Board of Directors. Steve Lamar, the President and CEO of the American Apparel & Footwear Association, who served as WITA’s Board Chair since 2004, will continue to serve as a member of WITA’s Board of Directors.  

“I am incredibly honored to step into the role of Chair of the WITA Board of Directors. Steve Lamar’s leadership has been instrumental in shaping WITA into a premier forum for trade dialogue and policy discussion,” said Nasim. “Steve has been a mentor and friend to so many of us in the trade community, generously sharing his insight and guidance over the years. I look forward to building on the strong foundation laid by Steve, and continuing to advance WITA’s mission to provide a neutral forum for the open and robust discussion of international trade policy.”

Nasim Fussell, WITA’s new Chair, is a Senior Vice President at Lot Sixteen, where she leads the firm’s trade practice. On Capitol Hill, Nasim served as the Chief International Trade Counsel for the Senate Finance Committee under Chairman Chuck Grassley and Deputy Chief International Trade Counsel under Chairman Hatch, as well as Trade Counsel to the House Ways and Means Committee, where she worked for Chairmen Brady, Ryan, and Camp. 

“Our whole team is excited to work with Nasim, and we are confident that she will be a worthy successor to all those whose leadership helped build the organization,” said Kenneth Levinson, WITA’s Chief Executive Officer. “Steve has been a tremendous leader in three transformational phases of WITAs growth,” continued Ken. “Steve oversaw the institutional development of WITA in the 2000s; the rapid growth of WITA’s membership in the 2010s; and its transition to a global platform for trade education in the 2020s.”

“Nasim has been an incredibly valuable member of WITA’s Board of Directors, and her accession to the Chair is a fantastic development that helps power WITA into the future by tapping into the next generation of leadership,” said Steve Lamar, WITA’s former Chair. “I look forward to working with Nasim and the Board as we help Ken and his team continue WITA’s incredible evolution.”

In addition to her roles in the U.S. Congress, Nasim has also worked in the private sector as a law firm partner, in-house with two multinational companies, and a trade association. She started her career at the U.S. Department of Commerce. She holds an LLM in International & Comparative Law from George Washington Law School, a JD from the University of Baltimore School of Law, and a BA in History from the University of Michigan.

Read the Full Press Release Here

03/12/2025 | WITA

Event Video: Driving Health, Innovation, and Economic Opportunity Through Data and [International] Trade

Global commerce depends on the ability to use information and communication technology (ICT) networks and the Internet to conduct business across borders. Cross-border data transfers are essential to innovation, US jobs, exports, and business in the agriculture, automotive, aerospace, finance, health, media, software, and telecommunications sectors, among others.

On Friday, March 14, WITA hosted a webinar to examine efforts to create a predictable and stable international framework to ensure the secure and responsible movement of information across borders.

Featured Speakers:

Stephen Claeys, Senior Director, Global Trade Policy, Pfizer

Josh Kallmer, Head of Global Public Policy and Government Relations, Zoom Communications, Inc.

Marta Prado, Director, Global Government Engagement, Visa

Andrew Wayne, Managing Director, Digital, Tax & Trade Policy, Siemens U.S. Government Affairs

Moderator: Nigel Cory, Director, Crowell Global Advisors

Watch the Full Event Video Here

03/14/2025 | WITA

The Trade Imbalance Index: Where the Trump Administration Should Take Action to Address Trade Distortions

As the Trump administration seeks to rebalance America’s trade relationships, it should focus the most attention on countries where U.S. industries face the worst trade distortions and imbalances, and where the greatest gains can be achieved for the U.S. economy. China, India, and the European Union top that list.

Key Takeaways

• The White House has given the Office of the U.S. Trade Representative, along with the departments of Treasury and Commerce, until April 1 to identify countries the administration should confront with corrective trade actions.
• It would be a mistake for the Trump administration to impose across-the-board tariffs on all nations, even if some run trade surpluses with America.
• The administration should focus on the nations that employ the most extensive arrays of unfair trade practices, including behind-the-border restrictions that specifically target U.S. companies or exports.
• Based on an index composed of 11 indicators covering America’s trade balances and key barriers U.S. industries face in markets around world, the administration should focus the greatest attention on China, India, and the European Union.
• While it is highly unlikely that tariffs or other pressure can convince China to reduce its trade distortions, such measures might work vis-à-vis U.S. relations with other nations.

Introduction

The second Trump administration has taken office looking to put U.S. trade relations on a more equitable footing with the rest of the world. President Trump has railed that other nations “are taking advantage of us” and vowed to ensure that U.S. companies are treated fairly in international markets. As Secretary of State Marco Rubio recently told U.S. allies, “I know you’ve gotten used to a foreign policy in which you act in the national interest of your country, and we sort of act in the interest of the globe or global order. But we are led by a different person now.”

To enact the president’s vision, the White House has instructed the Office of the United States Trade Representative (USTR), in coordination with the departments of Commerce and Treasury, to identify “any unfair trade practices by other countries and recommend appropriate actions to remedy such practices” by April 1, 2025.

Meanwhile, the president has already trained his fire at several nations in the opening weeks of his administration—notably Canada, China, Colombia, and Mexico—but the to-do list is long, as an increasing number of countries around the world have adopted mercantilist trade practices in recent decades. Against that backdrop, the administration should focus on countries where systematically unfair, mercantilist trade policies are inflicting the most significant damage on the U.S. economy and U.S. corporations (large and small alike), and where the United States stands to gain the most by restoring balanced trade. Accordingly, the Information Technology and Innovation Foundation (ITIF) has developed the “Trade Imbalance Index” described in this report. It evaluates 48 countries (15 of which are included in the “European Union” bloc) on 11 measures to ascertain which are the biggest trade mercantilists or scofflaws and where the Trump administration should concentrate its attention as it seeks to advance a trade policy that more effectively defends U.S. interests and ensures more balanced trade relations.

Read the Full Report Here

03/10/2025 | Stephen Ezell, Trelysa Long & Robert D. Atkinson |

Information Technology & Innovation Foundation

The U.S. Tariff Threat Could Break Canada—Or Be a Blessing in Disguise

If Donald Trump’s tariffs remain mostly a threat, or are quickly resolved once they are in fact implemented, this tiff may counterintuitively have the potential to be one of the best things that has happened for Canadian prosperity and unity in a long time.

The visceral reaction to President Trump’s threat of so-called “economic warfare” has forced Canadians to take a hard look at our productivity challenges in general and high dependence on the U.S. market in particular. This has already generated political commitments from nearly every corner to break out of the malaise that has held us back from realizing our potential.

Following through could save Canada from economic devastation and boost our sovereignty; failing to make meaningful changes like those listed below will not only harm us but also risks fracturing the federation.

Premiers are committing to break down internal trade barriers, which is certainly overdue and could boost our GDP by billions. Economist Trevor Tombe has estimated the boost from eliminating them entirely could be higher than the 3 to 4 percent GDP contraction expected if the tariffs do materialize. Despite the sharp change in tone from our premiers, however, we should not expect all the jurisdictional turf involved in these provincial barriers to be ceded.

Fortunately, there has been a strong shift in tone in another critical area: streamlining regulations on major infrastructure projects that extract our resources and transport them east-west.

Across the political spectrum, and even in Quebec, there is suddenly a great deal of life in what seemed a moribund area of economic opportunity. As politicians and their economic advisors now desperately scan Canadian industries for means of boosting our productivity, hostile policies holding back resources—especially oil and gas—stand out.

Read the Full Commentary Here

03/12/2025 | Bill Bewick | The Hub

WITA – We put the community in trade community.

Information about upcoming WITA and trade community events

TRADE COMMUNITY EVENTS CALENDAR

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U.S. trade policy has become a storm of unpredictability, leaving customs brokers scrambling to stay on top of ever-changing tariffs and rules. This has put global supply chain operators on their heels, trying to react, remain compliant, and keep freight moving.

Historically, the Customs and Border Protection (CBP) agency offered long lead times and clear guidance when implementing new regulations, allowing stakeholders to prepare and adapt. But recently, that pattern has shifted drastically. Instead of months or even weeks of preparation, new rules and changes are getting announced, often with just days of notice, and in some cases, rescinded after brief implementation periods. The result is chaos.

The impacts are immediate and far-reaching. The constant barrage of updates — such as tariff changes, new de minimis rules, and complex HTS (Harmonized Tariff Schedule) associations — has pushed customs workloads to the breaking point…

…The Unlimited Pool of AI “Workers”

Amid this chaos, AI is emerging as a crucial tool to streamline operations and mitigate the impacts of regulatory changes. While AI can’t replace a broker’s expertise, it can handle redundant data entry, lookup and processing tasks, which allows human operators to focus on strategic decision-making.

Today’s regulatory environment demands that brokers remain adaptable and up to date. AI technology that integrates directly with transportation management systems or Excel outputs can keep teams informed and ready to act without having to overhaul existing workflows.

AI can quickly identify and apply the most up-to-date HTS codes, and do it within the context of existing workflows, significantly reducing the time spent on manual lookups. Through automated lookup capabilities, AI ensures that the correct tariff information is used, helping brokers avoid costly mistakes and delays.

One of the most time-consuming aspects of the job is data entry. With the shift to more complex HTS code associations and the volume increases, brokers are spending far more time entering data into their systems. AI can help reduce this manual burden by streamlining classification and entry processes, allowing brokers to process more shipments in less time.

By automating routine tasks and ensuring that teams remain agile and adaptable, AI-enabled technology provides much-needed relief for brokers navigating these regulatory shifts, which is why it is one of the more mature business use cases in global logistics today.

Read the Full Blog Here

02/27/2025 | Greg Kefer | SupplyChainBrain

That’s What (Economic) Friends are For: Guiding Principles to Boost Supply Chain Security

The United States has recently pursued “friendshoring” of supply chains to trusted countries in the Indo-Pacific as part of its efforts to reduce dependence on China and make supply chains more resilient to global shocks. Friendshoring initiatives include plurilateral forums such as the Minerals Security Partnership and the Chip 4 Alliance, as well as initiatives to bolster bilateral economic relationships with Indonesia, Vietnam, and India, among other countries.

However, the implementation of U.S. friendshoring policy has met its fair share of challenges, including how potential tariff increases may impact its viability. Moreover, it is not always clear who is a “friend” of the United States, and there is uncertainty about the longevity and durability of the “friendship” classification. In addition, the increase in U.S. policies (and dollars) supporting domestic production – for example, through the 2022 Inflation Reduction Act – seems to be somewhat at odds with the goal of friendshoring to strengthen trusted supply chains. Furthermore, friendshoring policy reinforces trends toward the bifurcation of the global economy along a U.S./China split, contributing to a slowdown in global economic growth.

In interviews with Indo-Pacific experts both inside and outside government, the Asia Society Policy Institute (ASPI) heard that while U.S. engagement in the region is welcome, there are also some frustrations with the friendshoring policy. Interviewees bemoaned the lack of real economic benefits for their countries from initiatives to date and highlighted their disappointment with U.S. policies that subsidize domestic production, especially when they cannot compete with such incentives. The recent political positioning around Nippon Steel’s attempted acquisition of U.S. Steel was cited as undermining trust among friends of the United States. Respondents also emphasized the difficulty of excluding China from their supply chains, with several stressing the importance of balancing ties with China and the United States.

As the new administration considers the future of this policy, ASPI recommends bolstering friendshoring policies by adopting five guiding principles:

1. Strategic focus: Working closely with the private sector, focus friendshoring first on a limited number of strategic sectors in line with U.S. priorities, such as chips, critical minerals, and pharmaceuticals, and expand to other sectors over time.
2. Certainty: Take a long-term approach to building confidence among friends by situating friendshoring policy in a new, comprehensive U.S. economic security strategy. This would provide a clear direction, certainty, and consistency of application for friendshoring policy.
3. Expanding membership: Look beyond traditional partners to include trusted developing economies that will provide greater access to resources and supply networks for businesses.
4. Substantive benefits: Strengthen the benefits of friendshoring for both sides, including gains in market access, collaboration on research and development, and increased support for capacity building.
5. Engagement: Ensure that engagement with trusted partners – and the U.S. business community – goes both ways, creating ample opportunities for early discussion and feedback on new initiatives.

Read the Full Issue Paper Here

03/03/2025 | Jane Mellsop | Asia Society Policy Institute

Trump’s Tariffs – How Should the EU React?

The ‘Fair and Reciprocal Tariff Plan’ proposed by Donald Trump sounds innocuous but is a roadmap towards an all-out global trade war. To avert one, Europe must act firmly and speedily.

On February 13th, the Trump administration presented the Fair and Reciprocal Tariff Plan (FRTP), signalling that it is ready to end the global trading system as we know it. Financial markets greeted the proposal with a shrug, lost in the flurry of Trump’s executive orders. But in terms of consequences for the global economy, it is the most significant and devastating of Trump’s proposals.

What is being proposed?

Because of its name, many have interpreted the FRTP as a mirroring exercise in which the US would match its import tariffs with those faced by US exports in the partner country. The combination of countless products across a wide swathe of trade partners would lead to a huge number of different rates. In fact, such an exercise would be unworkable, as the US would have to manage over 2.6 million different tariff rates, depending on the product and the country. Even if the administrative complexity could be overcome, such a proposal would only raise tariff rates by a very modest amount. Trump’s plan would hit developing countries such as Vietnam and India hardest, since they tend to have higher tariffs. The consequences for Europe would be limited, as the average EU tariff rate on US imports is only half a per cent higher than US tariffs on EU imports. The EU could slightly lower its tariffs to iron out the wrinkle.

The problem is that Trump’s actual proposal is both simpler and more radical. According to White House officials, “the expected result is an individual additional tariff rate for each country or trading partner, rather than attempting to set corresponding tariff rates on every product.” Moreover, instead of just mirroring tariff rates, this overall additional tariff rate would be based on a combination of five factors:

1. Tariffs levied on US imports;
2. Taxes deemed unfair, extraterritorial or discriminatory, including value-added tax (VAT);
3. Non-tariff barriers, harmful policies like subsidies and regulatory requirements that impose costs on US businesses operating abroad;
4. Exchange rate policies that interfere with market values; and
5. Any other practice that interferes with market access or fair competition.

The potential scope of these measures is extraordinarily broad and represents a dramatic attempt to intervene in other countries’ internal regulation and taxation. It would de facto condition access to the US market on trading partners’ compliance with US preferences.

Read the Full Insight Here

02/26/2025 | Aslak Berg | Centre for European Reform

How the US Courts Rewrote the Rules of International Trade

Consider the following two stories involving legal disputes between American companies and foreign governments.

In 1919, the ocean steamer The Pesaro sailed from Genoa, Italy, for New York City. Built in Germany for a German shipper and formerly named the SS Moltke, the steamer had been seized by the Italian government in 1915 after Italy entered World War I. On board for its departure to America four years later were 75 cases of artificial silk owned by a company incorporated and based in the United States called the Berizzi Brothers. When The Pesaro arrived in New York after two weeks at sea, however, the Berizzi Brothers cried foul: Only 74 cases of silk were delivered. One had been lost or damaged in transit.

Eighty-two years later, a dispute on an altogether larger scale began. In 2001, with Argentina’s economy mired in recession, the country defaulted on around $93 billion of government debt, in what was then the largest sovereign debt default in history. Though a portion of that debt was owed to foreign governments, the default primarily involved private bondholders such as institutional investors. Most of these creditors would eventually agree to restructure the debt for cents on the dollar (thus booking losses), but a minority of the debt holders refused to accept this “haircut.” Like the Berizzi Brothers eight decades earlier, these holdouts, too, were based in the United States, namely a group of Wall Street “vulture funds” that had invested in the debt at distressed prices.

Beyond the fact that both cases pitted American firms against foreign governments, what links these stories is that the firms in question sought legal redress for their grievances. Not only that, but they sought this redress specifically in American courts, and thus by appeal to US law. The Berizzi Brothers sued for $250 in damages; the vulture-fund owners of the Argentinian debt sued for full face value plus interest.

The Berizzi Brothers’ case ended up in the US Supreme Court, and in 1926 the company lost, which is to say that the Italian government won. The Pesaro was owned and operated by Italy, and it was well established under US law that foreign governments (and their oceangoing vessels) were immune from suit in domestic courts. Yes, the Italian government was engaged in this case in a commercial activity, but it was so engaged, the court ruled, in a public rather than private capacity and with a public purpose.

But the Argentine government would not prove so fortunate, twice finding itself on the receiving end of negative legal judgments in its battle with the vulture funds. The first was when the US courts decided in 2012 in favor of the creditor holdouts, ruling that the full bond value was indeed due. The second followed Argentina’s subsequent decision—highly unusual among sovereign debtors in recent decades—to stand firm and continue to not pay up. While the US courts could not directly make Argentina pay, they could and did make life extremely uncomfortable, issuing rulings from 2012 to 2014 that indirectly forced the Argentine government’s hand by prohibiting it from making payments to other creditors unless it paid the holdouts first, and by prohibiting anyone anywhere in the world except Argentina from helping the country make such payments.

This pair of legal battles prompts a number of questions: What role does the law play in the arbitration of economic disputes? How does the direct involvement of sovereign states in such disputes affect that legal function? And what difference does it make when legal and economic disputes involving governments spill across national borders? These concerns have once again moved to the fore, with an explicitly protectionist and imperially minded president having taken the reins of power in America. The transition from The Pesaro and silk to Argentinian bonds and American vulture funds is an essential backdrop against which to answer these questions. In the course of eight decades, US courts seemingly made a decisive turn against foreign governments, stacking the deck in favor of American companies and becoming, in the process, a handmaiden to American empire.

Read the Full Article Here

03/03/2025 | Brett Christophers | The Nation

2025 Trade Policy Agenda and 2024 Annual Report of the President of the United States on the Trade Agreements Program

On February 27, the Office of the U.S. Trade Representative published their 2025 Trade Policy Agenda, 2024 Annual Report, and World Trade Organization at Thirty report to Congress.

The agenda lays out the Administration’s vision for trade, describing the economic and national security challenges facing the United States and articulates a plan for rebalancing trade to address those challenges, including the work required by the President’s America First Trade Policy Presidential Memorandum.

The 2024 Annual Report gives a summary of the activities undertaken by the Office of the USTR during the previous year. The WTO at Thirty report assesses U.S. interests at the WTO, in particular describing the challenges facing the institution and the need for reform.

Read the Full Report Here

02/27/2025 | Office of the U.S. Trade Representative

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Changing the Trade and Development Consensus

Meeting China’s Trade and Tech Challenge: How the US and Europe Can Come Together

America’s Trade Policy Reversal: Quantifying Trading Partner Exposure To Abrupt Losses of Goods Market Access

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It Is All About Trade

Donald Trump Wants Reciprocity in Trade: Here’s a Closer Look

Gauging Business Exposure to Trump’s Emerging Reciprocal Tariff Plans

C.J. Mahoney Joins Security Economics

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