On March 1, 2022, the United States Trade Representative (USTR) released the President’s 2022 Trade Policy Agenda and USTR’s 2021 Annual Report. These documents are issued yearly to Congress pursuant to Section 163 of the Trade Act of 1974. The agenda, which has historically been used as a messaging document, highlights the unique approach each Administration takes with regard to trade policy development, while the report is a formal overview of the work accomplished by the USTR in bilateral, region, plurilateral, and multilateral contexts. This is the second Trade Policy Agenda and Annual Report issued by the Biden Administration and the 33rd report issued in its current form.

The two documents reflect the Biden Administration’s overall shift in focus from opening new markets to pursuing a “worker-centric” trade policy, which is not likely to change in 2022. Instead, USTR will continue to work to promote sustainable labor and environmental policy through existing agreements, work to improve the resilience of global supply chains, and combat the COVID-19 pandemic.

In particular, while USTR has continued to engage periodically with China, progress in implementing the Phase One Agreement remains stalled, and the 2022 Agenda notes that USTR will be “deliberative with a focus on the long term” in its dealings with China. A trade development to monitor will be the rollout of a “Indo-Pacific Economic Framework,” a multilateral framework that, according to a White House Fact Sheet, will aim to enhance labor and environmental standards in trade, govern digital trade, build resilient supply chains, and tackle climate change. The 2022 Trade Policy Agenda does not shed light on whether the framework will be modeled after existing multilateral agreements such as the CPTPP, or if it will take an entirely new form.

The agenda is divided into an introduction and five sections while the report is divided into five sections and three additional annexes. An overview of the Administration’s Agenda and Accomplishments as provided by USTR is provided below:

THE PRESIDENT’S 2022 TRADE POLICY AGENDA

II. Advancing a Worker-Centered Trade Policy

  • An overview of efforts aimed at promoting workers’ rights, accelerating decarbonization, supporting U.S. agriculture, improving supply chain resiliency, and combating the COVID-19 pandemic.

III. Re-Aligning the U.S.–China Trade Relationship

“The Biden Administration is taking a new, holistic, and pragmatic approach to our relationship grounded in the principles of our worker-centered trade policy. We are clear-eyed about China’s doubling down on its harmful trade and economic abuses. We are also mindful that rash response measures can create vulnerabilities of their own. The Biden Administration’s approach to China is and will continue to be deliberative, with a focus on the long term.”

IV. Engaging with Key Trading Partners and Multilateral Institutions

“The Biden Administration is repairing strained relationships with partners and allies and recommitting the United States to the world’s international institutions.”

Indo-Pacific Economic Framework

  • “The Biden Administration is committed to engaging economically with partners in the Indo-Pacific region. In the coming decades, we believe that competitiveness will largely be defined by how well countries are able to harness technology and digital sectors of our economies and the coming energy and climate transition to promote inclusive growth – and working with our partners and allies in the Indo-Pacific will be critical to achieving these goals.”
  • “The United States is developing an Indo-Pacific Economic Framework to deepen economic relationships with allies and partners in the region. This framework will promote inclusive growth for workers and businesses, advance strong labor standards, and tackle climate change. The framework is also central to the Biden Administration’s economic strategy in the Indo-Pacific and complements our national security goals in the region.”

World Trade Organization

  • “The Biden Administration believes the WTO can––and should––be a force for good that encourages a race to the top and confronts global challenges as they arise.”
  • “The Biden Administration supports a WTO reform agenda that … reform agenda includes restoring efficacy to the negotiating arm and promoting transparency; improving compliance with and enforcement of Members’ WTO commitments; and equipping the Organization to effectively address the unfair practices of non-market economies––such as economic coercion––and global market distortions.”

Organization for Economic Cooperation and Development

  • “The Biden Administration has focused on the resolution of long-standing U.S. concerns about discriminatory digital services taxes and the negotiation of a historic political agreement to end the race to the bottom in global income tax competition.”
  • In 2021 “the Biden Administration reached agreements with India, Turkey, Austria, France, Italy, Spain, and the UK suspending the application of Digital Service Taxes (DSTs).”

Bilateral Initiatives

  • “President Biden has used trade policy as a tool to rebuild relationships with trading partners to advance a worker-centered trade policy. Some of these engagements were held under the auspices of existing trade agreements, including free trade agreements (FTAs) and trade and investment framework agreements (TIFAs), while others led to the formation of new partnerships.”

V. Promoting Confidence in Trade Policy Through Enforcement

  • “The Biden Administration is committed to vigorously enforcing our trade agreements as a critical element of pushing a global race to the top. Enforcement is a key component of our worker-centered trade policy agenda. We are using all of the tools at our disposal to combat unfair economic practices, defend American jobs, and create broad-based economic prosperity.”
  • “The Biden Administration supports reviewing our existing trade tools, identifying ways to strengthen them, and creating new tools as necessary. In 2022, we will work with Congress to fully evaluate the efficacy of our current trade tools and identify areas where new tools may be needed.”

VI. Promoting Equitable, Inclusive, And Durable Trade Policy and Expanding Stakeholder Engagement

Promoting Equitable, Inclusive, and Durable Trade Policy

  • “In strengthening the nation’s competitiveness and expanding the benefits of trade, racial and gender equity must be core elements of U.S. trade and investment policy. As a result, the 2021 Annual Trade Report includes unprecedented inaugural updates on USTR initiatives to advance racial and gender equity in U.S. trade policy.”

Engagement and Consultation with Partners and Stakeholders

  • “The Biden Administration recognizes Congress’ important role in crafting U.S. trade and investment policy.
  • “The Biden Administration has also regularly consulted and briefed the 28 advisory committees that USTR manages and co-leads as we seek to hear input from labor unions, environmental groups, consumer groups, non-governmental organizations, State and local Governments, industry, and academia.”
  • “USTR will continue to … encourage diverse and inclusive perspectives to apply to serve on trade advisory committees.”

THE 2021 ANNUAL REPORT OF THE PRESIDENT ON THE TRADE AGREEMENTS PROGRAM

I. Agreements and Negotiations

Selected excerpts, developments, and updates below:

United States–Mexico–Canada Agreement

  • “On July 1, 2020, the United States–Mexico–Canada Agreement (USMCA) entered into force, replacing the North American Free Trade Agreement (NAFTA). The Parties held the first meeting of the USMCA Committee on Sanitary and Phytosanitary Measures on May 6, 2021.”

China, Hong Kong, and Taiwan

  • For more information on the U.S.-China trade relationship, please see our blog post on the USTRs 2021 Report on China’s World Trade Organization (WTO) Compliance.
  • “In 2021, the United States continued to engage with Hong Kong, China (Hong Kong) on trade matters as appropriate. In particular, the United States has continued to press Hong Kong to update its copyright system to address concerns regarding digital copyright piracy.”
  • “In June 2021, under the auspices of AIT and TECRO, the United States and Taiwan convened the first TIFA Council meeting since October 2016. The two sides discussed a range of trade and investment issues and recognized upcoming changes to Taiwan’s medical device approval process. The two sides committed to intensify engagement aimed at addressing outstanding trade concerns, including with regard to market access barriers facing U.S. beef and pork producers, as well as concerns raised by the United States in areas such as copyright legislation, digital piracy, financial services, investment, and regulatory transparency.”

II. Trade Enforcement Activities

Through the vigorous application of U.S. trade laws and strategic use of dispute settlement procedures, the United States opens foreign markets to U.S. goods and services, helps defend U.S workers, businesses, and farmers against unfair practices, and promotes a level playing field through promoting respect for fair, market-oriented conditions.

Selected excerpts, developments, and updates below:

  • When U.S. trading partners have not been willing to negotiate settlements, USTR has pursued its offensive cases to conclusion, prevailing in 46 cases as of December 2021. The United States prevailed in complaints against foreign trade barriers involving:
    • China’s enforcement and protection of IP rights
    • China’s measures related to the exportation of raw materials
    • The EU’s subsidies to Airbus for large civil aircraft
    • The EU’s claim of compliance in the dispute involving subsidies to Airbus for large civil aircraft
  • Section 301
    • On October 8, 2021, USTR opened a docket seeking public comment on the possible reinstatement of the 549 previously extended exclusions. USTR is currently in the process of reviewing the public comments.

III. Other Trade Activities

Selected excerpts, developments, and updates below:

A core principle of USTR’s 2021 trade activities featured exploring how trade policy could contribute to and advance the United States’ economic competitiveness, resiliency, and equity. During 2021, USTR began implementing Presidential initiatives including:

  • Executive Order (EO) 13985, Advancing Racial Equity and Support for Underserved Communities Through the Federal Government.
  • EO 14020 that established and named USTR as a member of the White House Gender Policy Council.
  • The Presidential Memoranda on Tribal Consultation and Strengthening the Nation-to-Nation Relationship and on Advancing the Human Rights of Lesbian, Gay, Bisexual, Transgender, Queer, and Intersex Persons around the World.

IV. The World Trade Organization

  • “To remain a viable institution that can fulfill all facets of its work, the WTO must focus its work on structural reform, find a means of achieving trade liberalization between Ministerial Conferences, and must adapt to address the challenges faced by traders today.”
  • “In 2021, the United States focused on mechanisms to improve the overall functioning of the WTO, to include implementation of existing WTO Agreements.”
  • “Negotiations in 2021 focused on fisheries subsidies; a work program on electronic commerce, including an extension of the moratorium on customs duties on electronic transmissions; and, the advancement of WTO accessions, among other issues.”

V. Trade Policy Development

Selected excerpts, developments, and updates below:

  • “On May 7, 2021, U.S. Trade Representative Tai released a set of Transparency Principles that establish the foundation for a high transparency standard for the day-to-day operations of USTR. These Transparency Principles reflect the Administration’s commitment to comprehensive public engagement, including outreach to historically overlooked and underrepresented communities, as it develops and implements a trade policy that advances the interests of all Americans.”
  • “In 2021, USTR published approximately 65 Federal Register notices to solicit public comment on negotiations and policy decisions on a wide range of issues, including the annual Special 301 review including the Out-of-Cycle Review of Notorious Markets, the China 301 Investigation, digital services taxation, the Section 201 proceeding involving solar products, market opportunities for U.S. producers in overseas airport construction, and other topics.”

A full copy of the report can be found here.

USTR’s Press Release can be found here.

USTR’s Fact Sheet can be found here.

For more information on Trade Policy, contact our team and see previous posts below.

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