[CTC] Ohio Senators Seek Changes To TPP Auto Rules; Portman To Push Currency Bill

[Arthur Stamoulis]

INSIDE US TRADE
Ohio Senators Seek Changes To TPP Auto Rules; Portman To Push Currency Bill

April 13, 2016 
Sens. Sherrod Brown (D-OH) and Rob Portman (R-OH) this week called for the renegotiation of the auto rules of origin in the Trans-Pacific Partnership agreement, partially because they believe the existing rules would further damage the U.S. steel industry by allowing a large share of parts to come from third countries such as China.

The TPP threshold for a regional car is 45 percent of its value under the net cost method, and that will further reduce the use of U.S. steel in car production, they said in their April 12 testimony during the opening panel of an executive branch hearing on steel overcapacity.

The Senators both pointed out that this is much lower than the 62.5 percent required for a regional car in the North American Free Trade Agreement. The NAFTA had tracing requirements for non-originating content, while the TPP does not.

“The more foreign auto parts can be incorporated into a TPP-traded car, the less U.S. steel is used to make the vehicle,” Brown testified. “TPP’s auto rules of origin must be renegotiated to prevent further devastation to our steel industry."

“What happens with steel is going to happen with autos,” Brown told Inside U.S. Trade after his testimony.

Following his testimony, Portman said that the TPP auto rules of origin are a “huge issue” for him and that U.S. Trade Representative Michael Froman is well aware of that. He said he spoke to Froman about this even when TPP negotiations were ongoing.

Portman said renegotiation is needed to protect both steel and auto workers. “I hope [administration officials] are working on this and all other issues” that have been flagged as problems in TPP, he said. Portman has publicly come out as opposed to TPP <https://insidetrade.com/node/152442>.

Following his testimony, Brown told Inside U.S. Trade that he is not alone in his objections to the auto rules of origin and his demands for renegotiation.

“There will be many, many senators and House members that will call for renegotiation” of the TPP auto rules of origin, Brown said. He said many members are unhappy with that provision, but said he does not know who else is on record calling for its renegotiation. House Ways & Means Committee Ranking Member Sander Levin (D-MI) has cited the TPP auto rules of origin as one of four key problems <https://insidetrade.com/node/152667> with the deal that prompted him to oppose it.

Brown said that the auto rules are one of the “most contentious, one of the most problematic provisions of the whole [TPP] agreement."

Portman also said he would continue to push legislation to establish enforceable currency disciplines in trade agreements, “perhaps” as part of the TPP implementing bill. But he made clear he has not thought through all options for doing so. “If anything, we will be creative,” Portman said. He said he is trying to get the bill moving in “any way possible.”

Portman noted that his legislation to establish enforceable currency disciplines in trade agreements had come within two or three votes when it was considered by the Senate Finance Committee in the context of the fast-track bill last year. “That was pretty close, despite the administration, the Republican leadership, the Democratic leadership being against me,” he told reporters after the testimony.

He said he wants to get such provisions into trade agreements because that is where access to the U.S. market gives U.S. negotiators leverage over other countries to comply with what he said are International Monetary Fund disciplines.

He said he is “very concerned” about the pledge TPP nations signed on currency policies because it has “no teeth, no enforcement."

Portman testified that the administration needs to do its part to fight against currency manipulation by pushing the issue in bilateral talks and labeling foreign countries as currency manipulators when they are. This refers to the administration’s biannual report to Congress that is to identify countries that manipulate their currencies to gain an unfair trade advantage.


-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://lists.citizenstrade.org/pipermail/ctcfield-citizenstrade.org/attachments/20160415/7af83a1e/attachment-0001.htm>