In accordance with a US statutory requirement, on March 1, 2017, the Trump administration released its “2017 Trade Policy Agenda and 2016 Annual Report of the President of the United States on Trade Agreements Program” (“Trade Agenda”). The document asserts that it is preliminary because the designee for the role of the United States Trade Representative (USTR), Robert Lighthizer, has not yet been confirmed by the Senate. The Trade Agenda states that once he is confirmed, a more detailed report will be submitted to Congress.
While the document does not have legal consequence, it does set a tone for the approach of the new trade team. The administration declares that its guiding principle will be to “expand trade in a way that is freer and fairer for all Americans,” and identifies four priorities:
- defend US national sovereignty over trade policy;
- strictly enforce US trade laws;
- use all possible sources of leverage to encourage other countries to open their markets to US exports; and
- negotiate new, better trade deals with key markets.
In elucidating these principles, the administration declares that:
- the administration’s preference for bilateral trade agreements over multilateral agreements;
- WTO Dispute Resolution Panel (and WTO Appellate Body) rulings “do not automatically lead to changes in US law or practice”, and the US did not surrender its sovereignty when agreeing to the WTO;
- WTO rules assume that countries implementing the rules “are based fundamentally on free-market principles” and “have legal and regulatory systems that are fundamentally transparent,” and “there are a number of major countries” that operate contrary to those assumptions;
- “it is time for a more aggressive approach,” and that “the Trump Administration will use all possible leverage – including, if necessary, applying the principle of reciprocity to countries that refuse to open their markets – to encourage other countries to give US producers full and fair access to their markets”;
- China’s WTO accession has led to manufacturing job losses, noting that from January 2000 to January 2017, the United States lost almost 5 million manufacturing jobs; and
- the recent US-Korea free trade agreement has “coincided with a dramatic increase in our trade deficit” with Korea.
This Trade Agenda is meant to signal a new approach to trade policy by the Trump Administration. The new team believes that some large WTO members with export-oriented economies have gamed the international trade rules (e.g., through subsidies, currency manipulation, obstacles to imports). The administration intends to “apply the principle of reciprocity to countries that refuse to open their markets.”