TRADE UPDATE

Food & Agriculture
March 22, 2022

By Michael Anderson, Vice President of Trade and Industry Affairs

HIGHLIGHTS

  • USMCA: A bipartisan group of over 30 lawmakers sent a letter, urging Secretary Vilsack to solve the impasse on enhanced market access in Mexico for U.S. fresh potatoes. Mexican officials are insisting on increased inspections of U.S. imports despite a Mexican Supreme Court decision that ruled in favor of the U.S. potato industry in April of 2021.
  • U.S. – China: Reconciliation of the Senate and House China Competition bills may take a step forward this week. Senate Majority Leader Chuck Schumer (NY-D) announced the bipartisan jobs and competitiveness legislation, which will consist of compromised legislation from the House’s America COMPETES Act and the Senate’s USICA, will be amended by the Senate and sent back to the House.
  • U.S. – Russia: Heeding calls from President Biden, the House passed a bill (424-8) to revoke permanent normal trade relations with Russia that could pave the way for higher tariffs on Russian imports. The EU and several other G-7 countries are pursuing similar actions to counter Russia’s invasion of Ukraine.
  • Indo-Pacific Economic Framework: Senators highlighted key areas of consideration for the IPEF during a Senate Finance Committee hearing last week. Several senators at the hearing expressed their desire for including market access in the IPEF.
  • WTO: The WTO announced the EU, U.S., India, and South Africa have reached a deal on the Trade Intellectual Property Rights (TRIPS) agreement, regarding COVID-19 vaccine production. The comprise on TRIPS represents an important breakthrough just two months before 12th ministerial, paving the way for further advancement on contentious issues.

“The Administration’s present position of leaving out a market access outcome makes no sense.” “Economically, our workers, businesses and farmers will lose out on important opportunities if we stay on the sidelines.”

— Senator Mike Crapo (R-ID), recent Senate Finance Committee hearing on the proposed IPEF

USMCA

U.S.-Mexico potato dispute draws congressional attention

  • In a bipartisan letter, 34 congressmen urged Secretary Vilsack to solve the U.S.-Mexico trade dispute caused by Mexico’s failure to allow access for U.S. fresh potatoes. Despite a Mexican Supreme Court decision that ruled in favor of the U.S. potato industry in April of 2021, Mexico has not permitted appropriate market access for U.S. potatoes, citing an Animal and Plant Health Inspection Service (APHIS) and SENASICA joint announcement that calls for “additional site visits in 2022 as a prerequisite to opening the market” and “it was announced that processing potato access to Mexico would be arbitrarily limited to only two companies for 2022.”
    • “Neither of these requirements exist within the U.S.-Mexico work plan that was concluded at the end of last year,” according to the bipartisan lawmakers. The congressmen went on to press USDA to ensure Mexico honors their side of the agreement and requested that “APHIS explain its decision-making process to agree to these unscientific and inconsistent demands.”
    • If USDA fails to solve the dispute, “inaction is estimated to be $150 million to U.S. growers on an annual basis.” In the meantime, the lawmakers proposed the U.S. should deny “any Mexican request for enhanced access” before the issue is settled. 

USTR raises biotech approvals with Mexico

  • Deputy USTR Jayme White, in a virtual deputies meeting with Mexico’s Under Secretary for International Trade, Luz Maria de la Mora, emphasized the need for cooperation on a science-based approach for biotech in Mexico.  According to a USTR readout from the virtual meeting among the deputies, Ambassador White, “emphasized the importance of…discussions in the Working Group on Cooperation on Agricultural Biotechnology to ensure science- and risk-based regulatory approaches in agriculture and the approval of agricultural biotechnology products.”

China Trade

China competition bill inches forward

  • Senate Majority Leader Chuck Schumer (NY-D) announced the bipartisan jobs and competitiveness legislation, which will consist of compromised legislation from the House’s America COMPETES Act and the Senate’s USICA, will be amended by the Senate and sent back to the House next week. “Now, despite filing cloture, it’s far better for Democrats and Republicans to reach an agreement to vote on this bill quickly, and we’ll keep working on that over the next few days,” said the Senator.
  • Both USICA and America COMPETES aim to enhance American competitiveness in the face of anti-competitive Chinese action through investment in semiconductor chips, supporting supply chains and manufacturing, conducting scientific research, and enforcing targeted anti-China measures. Major differences between the two pieces of legislation include the presence of language regarding Section 301 exclusions and the strictness of GSP eligibility and de minimis criteria, among other variations.

U.S. businesses want “transitionary period” for Uyghur Forced Labor Prevention Act

  • Right now, the Biden Administration’s Uyghur Forced Labor Prevention Act requires companies importing goods from the Xinjiang region of China to show clear evidence that such goods were not made via forced labor. Otherwise, U.S. Customs and Border Protection must presume all goods made in the region were produced using forced labor within 180 days. The U.S.-China Business Council, along with other organizations that represent China-based U.S. businesses, have called for “a transitionary period of at least one year from the issuance of FLETF [Forced Labor Enforcement Task Force] guidance to allow companies time to conduct due diligence, collect documentation, and adjust supply chains.”
map of Xinjiang region of China
Map from BBC

Additional USDA guidance for exports under China Decree 248

  • Based on an observed increase in detained U.S. food and agriculture shipments under China’s Decree 248, the Foreign Agriculture Service (FAS) issued new guidance and contacts for impacted exporters. The notification encouraged U.S. exporters to carefully verify compliance of their shipments with the guidelines of Decree 248 and to report specific instances of detained shipments to the following: contact: [email protected] and [email protected].
    • FAS further noted the most common reasons exporters and importers are reporting that their shipments are detained include: 1) having a Chinese facility registration number that is for a different commodity class than the one being imported and 2) that a product was produced or shipped before GACC added it to the list of products requiring registration. (Note: GACC continues to amend the products that are subject to the requirements of Decree 248.)

COVID-19

U.S. import and export prices remain elevated

  • The indexes of U.S. export and import prices remained elevated in February, confirming trade’s role in rising inflation and global price pressures.  According to the Bureau of Labor Statistics (BLS), February exports prices were 16.6% higher than a year earlier, and imports were 10.9% higher. Oil prices rose 8.1% in February, the largest contributor to increasing import prices. After rising to nearly $130 a barrel after Russia’s invasion of Ukraine, it is now down to about $100.
U.S. export and import price indexes have stayed elevated in 2022

Fed hikes interest rates

  • In an effort to curtail rising inflation, the Federal Reserve announced its first interest rate increase since 2018. So far, the central bank has added 0.25% to the borrowing rate due to data showing rising prices, which will only be further elevated by fallout effects of the war in Ukraine. “The Fed is now targeting between 0.25 and 0.5 percent for its main policy rate. If it follows through on the rate hikes envisioned this year, the federal funds rate target would be nearly 2 percent, still near historic lows,” according to Politico reports. The inflation plan set by the Federal Reserve is meant to slow down the economy by reducing borrowing and subsequent demand with the ultimate goal of lowering prices.

Agriculture Exports

Russia-Ukraine conflict impacts grains trade

  • The war between Russia and Ukraine has spurred anxiety about the global supply and trade of several agricultural products. The two countries are both major producers of corn and wheat. As of right now, there is much uncertainty about Ukrainian farmers’ ability to harvest their winter wheat and plant their spring corn.
  • Meanwhile, the “Russian government is suspending the export of wheat, rye, barley and corn to ex-Soviet countries,” according to reports by Agri-Pulse. The countries included in the ban, which was put in place March 15th and is set to last through June 30th, are Armenia, Belarus, Kazakhstan, and Kyrgyzstan.
    • Agri-Pulse noted, “Russian grain accounts for 16% of the world’s wheat exports, 13% of global barley exports, 3% of world corn exports and 22% of all the sunflower meal and 30% of sunflower oil exported, according to USDA data.”
    • And “in a normal year Ukraine would account for 10% of global wheat exports, 14% of global corn exports, 58% of global sunflower meal exports and 47% of global sunflower oil exports.”
Aljazeera infographic on global wheat supply
Flow of Russian and Ukrainian wheat trade. Infographic from Aljazeera.

G7 ministers address ag implications of Russia-Ukraine conflict

  • In response to Russia’s invasion of Ukraine, the G7 agriculture ministers, including the United States’ Secretary Vilsack, convened a meeting during which the officials “condemned the invasion and expressed their shared commitment to safeguarding global food security and nutrition, to strengthening supply chains, to avoiding export bans and other trade-restrictive measures, and to maintaining open and transparent markets.” Together the agriculture ministers released a statement calling on “international organisations to support food production in Ukraine” and encouraging “all countries to keep their food and agricultural markets open and to guard against any unjustified restrictive measures on their exports.” Furthermore, the G7 declared they “will not tolerate artificially inflated prices that could diminish the availability of food and agricultural products” and will work to address challenges created by the conflict.
G7 agriculture ministers talk about Russia-Ukraine conflict

Supply Chains

Congressman John Thune (R-SD)

Anticipated action on the Ocean Shipping Reform Act

  • During an interview with Agri-Pulse, Senate Finance Committee member John Thune (R-SD) said the Ocean Shipping Reform Act, which was approved as an amendment to the America COMPETES Act, is “long overdue.” The bill aims to ease maritime supply chain issues and “is designed to support the growth and development of U.S. exports and promote reciprocal trade in the common carriage of goods by water in the foreign commerce of the United States.” While speaking with Agri-Pulse, Senator Thune noted, there has been “discussion about potentially marking the bill up and reporting it out to the floor.” The Commerce committee may act on the bill shortly.

Fertilizer supply chain faces major impediment

  • Following failed labor negotiations between the Canadian Pacific Railway and the Teamsters Rail Conference Canada union, the railway, which acts as a critical vehicle for transporting fertilizer to the U.S., has shut down. “The work stoppage has begun, but CP and Teamsters are still at the table with federal mediators. Parties are working through the night. We are monitoring the situation closely and expect the parties to keep working until they reach an agreement,” Canadian Minister of Labour Seamus O’Regan Jr. announced in a tweet.
  • “A rail disruption at a time when fertilizer supply chains are already stretched may have immediate and significant global consequences,” a Nutrien spokeswoman commented on the work stoppage to Agri-Pulse last week.
  • Just days before the shutdown, over 80 U.S. lawmakers expressed their anxiety about the supply of fertilizer to the U.S. In this case, the congressmen wrote to U.S. International Trade Commission Chair Jason E. Kearns “to reconsider the duties placed on phosphate fertilizer products imported from Morocco and suspend the current process to impose new duties on urea ammonium nitrate fertilizer from Trinidad and Tobago.” The request, in conjuncture with the work stoppage, highlights a critical situation surrounding fertilizer imports into the U.S. If this situation remains unaddressed, fertilizer prices will continue to soar and subsequently, the price of food is also expected to increase.

U.S. – Panama

Panama calls on the U.S to revisit agricultural trade duties

  • A statement, confirming the Panamanian government’s request to revisit agricultural trade commitments with the U.S., was released by the country’s government last week. According to the statement, which was reported on by Inside U.S. Trade, Panamanian officials would like to work with the U.S. to “review the phasing out of tariff-rate quotas on U.S. exports of certain “sensitive” agricultural products — specifically, rice, dairy, pork and poultry — as provided for under the U.S.-Panama Trade Promotion Agreement.” The phasing out of duties on sensitive agricultural products is on course to accelerate in the upcoming years. Therefore, the Panamanian government would like to hold talks with the U.S. to work on mitigating any harm this may cause Panama’s agricultural production.

U.S. – Russia

Russia-Ukraine conflict puts inflation on the rise

  • Russia’s invasion of the Ukraine is exacerbating already high inflationary pressures. The United States reported a 40-year high in consumer-price inflation last month at 7.9% year on year. The Economist predicts these number will continue to grow as a result of the Russia-Ukraine conflict. “The most striking evidence of the upward shift in inflation expectations can be found in fixed-income markets in America… In late January the expected rate of inflation over the next year was 3.5%. By March 11th, it had soared to 5.6%, far and away the highest since the pandemic began,” said the British news outlet. Similar high inflation trends are predicted across the world, especially throughout Europe, as Russia’s invasion of the Ukraine continues on with an unforeseen end.

EU revoking Russia’s MFN status

  • Last week, the EU moved to cancel Russia’s “most-favored-nation” (MFN) status at the WTO, clearing the way for more bans on Russian imports and/or higher tariffs on Russian goods by EU member countries.  The sanctions will affect Russian exports such as diamonds, platinum, and seafood. The EU actions are another tool to isolate Russia and place greater pressure on President Vladimir Putin to end the war in Ukraine.

House votes to end Russia’s PNTR status

  • Following President Biden’s announcement that the U.S., along with other G7 countries and NATO allies, would work to end Russia’s PNTR status, the House passed a bill (424-8) to do just that. The bill, which revokes permanent normal trade relations with Belarus in addition to Russia, must now pass the Senate to be made into law. “As Russia continues its horrific, unprovoked war on the Ukrainian people, the House is moving to inflict even greater economic pain on Russia and Belarus. In conjunction with the energy ban we passed last week, suspending normal trade relations is a necessary step to hold Putin accountable for his senseless attacks,” House Ways & Means Committee Chair Richard Neal (MA-D) said about the legislation.
    • A recent analysis by the Progressive Policy Institute showed that revoking PNTR would have an unusually small impact on Russia, a significant exporter of raw materials, because “America’s ‘non-MFN’ tariffs on natural resources are usually low.” Many U.S. allies are also moving to revoke Russia’s MFN treatment.

Section 232 Investigations

Cost burden of Section 232 tariffs

  • In a report created by the American Action Forum, two researchers, Tom Lee and Jaqueline Varas identified the economic impact of Section 232 steel and aluminum tariffs over the course of 2021. According to Lee and Varas’ data, Section 232 tariffs added an additional cost burden of $1.9 billion to steel imports, $618.6 million to aluminum imports, $421.0 million to derivative steel articles imports, and $241.6 million to derivative aluminum articles imports, totaling the additional cost burden for Section 232 tariffs at roughly $3.2 billion.

U.S. – U.K. tariff talks continue

  • No significant update on U.S. – U.K. talks on resolving Section 232 tariff disputes. Secretary of Commerce Raimondo, Ambassador Tai, and U.K. Secretary of State for International Trade Trevelyan have met virtually, discussing U.S. Section 232 tariffs on U.K. imports and U.K. retaliatory tariffs on U.S. exports to the U.K. “They agreed that, as the United States and the United Kingdom are close and long-standing partners, sharing similar national security interests as democratic market economies, they can partner to promote high standards, address shared concerns and hold countries that practice harmful market-distorting policies to account,” according to a U.S. – U.K joint statement on the issue.

Section 301 Investigations

Section 301 investigations delayed

  • According to recent accounts reported by Politico, Section 301 investigation talks are being delayed due to the Russia-Ukraine conflict.  The Administration is currently “waiting to see if China will answer Moscow’s calls for economic and military aid … Any Chinese assistance could result in harsher sanctions and trade restrictions on Chinese companies and officials, though American officials this week have declined to detail which actions they are considering should China come to Russia’s aid,” stated a Politico report on the current status of the investigations.
  • Lawmakers have already stepped up to relay their disapproval of the Administration’s decision to delay 301 investigations. In a letter addressed to Ambassador Tai, U.S. Senator Tom Cotton (AR-R) wrote that he is concerned about the investigations’ delay, citing China’s non-market economic practices and failure to uphold trade commitments. “The CCP has shown nothing but malice towards this nation and should be shown no leniency in our response to its economic aggression,” he wrote. Senator Cotton continued by noting 301 investigations “would likely result in barriers to subsidized Chinese goods and would blunt Beijing’s attempt to dominate critical sectors through economic aggression.”

Biden Transition

Elaine Trevino withdraws from USTR Chief Negotiator consideration
Elaine Trevino, former president of the Almond Alliance of California

Elaine Trevino withdraws from USTR Chief Agriculture Negotiator consideration

  • Elaine Trevino, the Biden Administration’s nominee for USTR Chief Agriculture Negotiator, wrote to the President to withdraw from consideration for the role. “It now seems clear that there is no timely path forward to gain Senate confirmation,” she said. Despite her withdrawal from the USTR position, Ms. Trevino indicated that she may be considered for a lesser role within the Administration. “I am excited to join the Administration in another capacity where I will engage and work on complex supply chain issues that have negatively impacted American agriculture,” she told President Biden.
  • Elaine Trevino’s nomination for the USTR Chief Agriculture Negotiator position was stalled for six months prior to her withdrawal from consideration. Now, the process to find a new candidate for the role must start over again, much to the dismay of agricultural industry actors and lawmakers who are anxious to fill the vacant position.

Indo- Pacific Economic Framework

Senate hearing on Indo-Pacific trade

  • Senators highlighted key areas of consideration for the IPEF during a Senate Finance Committee hearing on “the Promise and Challenge of Strategic Trade Engagement in the Indo-Pacific Region.” The lawmakers engaged in conversation on digital trade, worker-centered trade, and agricultural trade, among other issues with witnesses Sharon Bomer Lauritsen (Principal, AgTrade Strategies LLC), Emma Llansó (Director, Free Expression Project, Center for Democracy and Technology), Kelly Ann Shaw (Partner, Former Deputy Assistant to The President For International Economic Affairs (2018 – 2019), Hogan Lovells), and Michael Wessel (President, Staff Chair, The Wessel Group, The Labor Advisory Committee for Trade Negotiations and Trade Policy).
  • Several senators at the hearing expressed their desire for including market access in the IPEF, noting it as a necessary provision to incentive broad participation in the new framework. The lawmakers also posed questions about the lessons learned from past multilateral agreements. The witnesses identified the labor chapter of the USMCA as a prime example of an aptly crafted trade agreement that addressed worker-centered trade. “We need to include a similar concept in the IPEF that defines the [labor] rights and couple it with an enforcement mechanism that is accessible, timely and as possible, facility-specific,” said Mr. Wessel.
  • Regarding agricultural trade with the Indo-Pacific, Ms. Lauritsen shared her expertise with the senators, noting the critical importance of addressing sanitary and phytosanitary measures when crafting the Indo-Pacific Economic Framework. She also spoke to the necessity of including dispute settlement measures to ensure the enforceability of the wide-sweeping agreement. Several lawmakers, including Senators Daines (MT-R), Cassidy (LA-R), and Grassley (IA-R) inquired about enhancing trade with India. Ms. Lauritsen noted the potential for a strengthened agricultural trading relationship with India, and other Indo-Pacific nations, if the U.S. takes a seat at the table and leverages market access and tariffs appropriately.

USTR invites comments on IPEF

  • As reported earlier, USTR posted a request for comments on the proposed Fair and Resilient Trade pillar of the Indo-Pacific Economic Framework. The request, which will close a month after its publication date, aims to gauge “U.S. interests and priorities, in order to develop U.S. negotiating objectives and positions and identify potential partners.” In line with the Biden Administration’s objective of establishing “worker-centered” trade, the Trade Policy Staff Committee (TPSC) invites comments on the issues “USTR should address in the negotiations” of the trade pillar of the IPEF.  USTR added in its notice, “the Administration is not seeking to address tariff barriers.” The deadline for submission is April 11.

U.S. – South Korea

Ambassador Tai meets with Minister Yeo and SK Siltron executives

KORUS FTA’s 10th anniversary

  • Ambassador Tai, Korea’s Trade Minister Yeo Han-koo, and SK Siltron (a semiconductor manufacturing company) executives celebrated the 10th anniversary of the U.S.-Korea Free Trade Agreement (KORUS FTA) in Auburn, Michigan. Together the officials and business leaders held a round table where they discussed the future of infrastructure and critical technologies, highlighting the importance of such industries. “That is why Congress should pass the Bipartisan Innovation Act to increase American competitiveness and lower prices for working families by addressing bottlenecks like semiconductor chips, manufacturing more in America, and increasing supply chain resiliency,” said Ambassador Tai. 
  • “Korea is the U.S.’ sixth-largest trading partner and the value of our goods services exports to Korea has grown by over 17 percent to nearly $70 billion since the agreement (KORUS FTA) entered into force,” according to a USTR press release on the round table.

U.S. – Australia

Ambassador Bianchi travels to Australia

  • Deputy U.S. Trade Representative Sarah Bianchi flew to Australia to meet with several officials this week. Ambassador Bianchi started off her trip by convening with members of the American Chamber of Commerce in Australia where she “emphasized the Biden-Harris Administration’s commitment to strengthening the U.S. – Australia trade relationship and provided an update about the ongoing effort to develop an Indo-Pacific Economic Framework.” In line with the Administration’s efforts to incorporate stakeholder feedback into the framework, the Ambassador also asked for the Chamber’s thoughts and suggestions on the policy agenda for the Indo-Pacific region.
  • On the second day of her trip, Ambassador Bianchi “met with American-based engineering and construction company Bechtel [and] convened a roundtable with union and labor stakeholders,” where she continued discussions on the IPEF.  Following her meetings with Bechtel and the stakeholders, the Ambassador “engaged the government of New South Wales, and welcomed the new U.S. Consul General in Sydney, Christine Elder, to her post.”  
  • Deputy USTR Bianchi then “met with Minister for Trade, Tourism, and Investment Dan Tehan, spoke with Secretary for Agriculture, Water, and Environment Andrew Metcalfe, and co-chaired the Free Trade Agreement Joint Committee meeting with Associate Secretary for Trade and Investment Tim Yeend” on the third day of her stay in Australia. In addition to further IPEF discussions, the Ambassador deliberated agricultural trade. According to a readout of Ambassador Bianchi’s talks, “The United States and Australia committed to working together to address outstanding agricultural concerns, including committing to convene a meeting of the Sanitary and Phytosanitary Committee under the Free Trade Agreement (FTA).  The two sides will organize a meeting of the FTA SPS Committee before the end of 2022, and to continue conversations on priorities ahead of this meeting.”

U.S. – India

American Soybeans Association wants FTA with India

  • The American Soybeans Association is pushing for the United States government to commence free trade agreement (FTA) negotiations with India, following an association delegate vote on the initiative. “I think the delegates were emphasizing the interest in developing a bilateral trade agreement with India … because of its population. They have a billion people,” ASA CEO Stephen Censky told Agri-Pulse after the vote. According to Agri-Pulse, India “temporarily opened its market last year to U.S. soymeal, allowing for imports of roughly 1.2 million metric tons.” Now that the Indian market has closed again to U.S. exporters (as of Oct. 31st), soy industry actors are eager to see free trade with the South Asian region again.

U.S. – EU

Ambassador Tai and Minister Nowak shake hands
Ambassador Tai and Minister Nowak

USTR Tai meets with Polish officials

  • Ambassador Tai reaffirmed the United States’ “commitment to the security of Poland and all of our NATO allies in light of Russia’s premeditated, unprovoked, and unjustified invasion of Ukraine” during a meeting with Poland’s Minister of Economic Development and Technology Piotr Nowak and Poland’s Ambassador to the United States Marek Magierowski. During her conversation with the Polish officials, USTR Tai also spoke to the importance of addressing “challenges posed by non-market policies and practices, as well as improving both market access and the regulatory environment for U.S. companies in Poland.” Minister Nowak agreed with Ambassador Tai’s statements on U.S.-EU collaboration and the two discussed the potential of the U.S.-EU Trade and Technology Council (TCC) in achieving mutual goals.

U.S. – U.K. Trade

New U.S.-U.K. trade talks announced

  • Following a long period of no updates on U.S.-U.K. trade, USTR has announced the two countries will hold joint U.S./U.K. Dialogues on the Future of Atlantic Trade in Baltimore, Maryland on March 22nd and 23rd. The talks will continue in the U.K. later this Spring. “The U.S./UK Dialogues on the Future of Atlantic Trade will explore how the United States and United Kingdom can collaborate to advance mutual international trade priorities rooted in our shared values, while promoting innovation and inclusive economic growth for workers and businesses on both sides of the Atlantic,” noted a USTR press release on the meetings. 
  • Ambassador Tai expressed her enthusiasm for the upcoming dialogues in a comment published by USTR, “The United Kingdom is one of our oldest and most trusted allies, and our partnership is rooted in shared values and priorities. These Dialogues will provide an opportunity to engage our stakeholders to help inform how an inclusive trade policy can promote equitable economic growth and prosperity for our two countries.”
    • Ambassador Tai nor USTR’s statements mentioned a future FTA with the U.K. but the talks do indicate long-awaited progress to be made in strengthening U.S.-U.K. trade.
USTR tweet about dialogues on the future of atlantic trade
  • Earlier in the year, Ambassador Tai affirmed that bilateral talks on a comprehensive FTA “were paused”, suggesting the Biden administration will pursue a different take with the U.K., rather than restarting prior talks commenced under President Trump.

WTO

Compromise on TRIPS waiver

  • WTO Director-General (DG) Ngozi Okonjo-Iweala revealed the EU, U.S., India, and South Africa have reached a deal on the Trade Intellectual Property Rights (TRIPS) agreement, regarding COVID-19 vaccine production. “This is a major step forward and this compromise is the result of many long and difficult hours of negotiations. But we are not there yet. We have more work to do to ensure that we have the support of the entire WTO Membership,” the DG said. In a separate statement, USTR Spokesperson Adam Hodge noted, “no agreement on text has been reached” but the U.S. and other countries “are in the process of consulting on the outcome.” The comprise on TRIPS comes two months before MC12, paving the way for further advancement on contentious issues before the 12th ministerial.

MC12 meeting still on calendar despite Russian invasion of Ukraine

  • The WTO continues to make preparation for convening the 12th ministerial conference on June 12th-15th, despite escalating criticism of Russia and calls for the WTO to expel or curtail the country’s participation in the global trade body.  In a strongly worded statement issued last week, the U.S., EU, and 12 other allies threatened they “will take any actions, as WTO Members, that we each consider necessary to protect our essential security interests.”
    • The 14 countries said their proposed actions “may include actions in support of Ukraine, or actions to suspend concessions or other obligations with respect to the Russian Federation, such as the suspension of most-favored-nation treatment to products and services of the Russian Federation.” The signatories also indicated that “in light of Belarus’ material support to the actions of the Russian Federation, we consider that its accession process is suspended and will not participate in any accession-related work.”  The countries on the statement include Albania, Australia, Canada, European Union, Iceland, Japan, Korea, Moldova, Montenegro, New Zealand, North Macedonia, Norway, United Kingdom, and United States.

Agriculture Committee’s 100th session

  • The WTO’s Agriculture Committee held its 100th session where members discussed “multiple farm trade policies, updated information on the impact of COVID-19 on agri-food trade and adopted the report of the triennial review of the Nairobi Decision on export competition.” Moreover, “While continuing to follow up on other Ministerial Decisions’ implementation matters, members suspended discussions on the Bali tariff rate quota (TRQ) underfill mechanism with a view to reaching consensus before the deadline of 31 March,” according to a readout on the meeting.

WTO announces Public Forum theme

  • The WTO’s 2022 Public Forum will be held September 27th-30th and the theme will be “Towards a sustainable and inclusive recovery: ambition to action,” focusing on post-COVID economic recovery. The sub-themes will include “Leveraging technology for an inclusive recovery,” “Delivering a trade agenda for a sustainable future,” and “Framing the future of trade.” The WTO’s Public Forum offers an opportunity for “heads of state, parliamentarians, business people, students, academics and civil society to come together and debate a wide range of trade and development topics.” Registration for the event will open in May.
WTO tweet about the 2022 public forum