2021_2_US Trade Policy

https://en.wikipedia.org/wiki/Foreign_trade_of_the_United_States

Foreign trade of the United States

 What is the meaning of trade policy?
Trade policy refers to the regulations and agreements that control imports and
exports to foreign countries.

 What are the two major trade policies?

Liberalization (free trade policy) and protectionism are two fundamental
instruments for governments to control international trade, in other words, two
different types of foreign trade policy

Elements of the U.S. Trade Policy

 What is US Trade policy? Since the end of World War II, U.S. trade policy has focused on
fostering an open, rules-based global trading system, liberalizing markets by reducing trade
and investment barriers through negotiations and agreements, and enforcing trade
commitments and related laws.

 Who sets US trade policy?

The Executive Branch: Office of the United States Trade Representative

The Office of the U.S. Trade Representative (USTR) is responsible for developing
and coordinating U.S. international trade, commodity, and direct investment policy,
and leading or directing negotiations with other countries on such matters.

 What are trade policies examples?

Any policy that directly affects the flow of goods and services between countries, such
as import tariffs, import quotas, voluntary export restraints, export taxes, and
export subsidies.
.

 What is the main objective of trade policy?

General trade policy objectives have focused on reduced protection, achieving a
more outward- oriented trade regime, increased market access for exports, and greater
global integration, aimed at increasing economic efficiency, competitiveness, and
export-led growth.

 What are the instruments of trade control?

The four main protective devices are subsidies to domestic producers, taxes on
imports, quantitative restrictions on imports, and state trading. Taxes on imports
are historically the principal device.

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  What are 3 sets of economic tools that US policy makers have as it relates to
trade?
Tariffs, import quotas, product standards, and subsidies are some of the primary
policy tools a government can use in enacting protectionist policies

US Trade Agreements:
The U.S. trade policy and investment system includes the World Trade Organization (WTO)
agreements which form the "multilateral bedrock of U.S. trade policy"1, its tariff, tariff rate
quotas, 14 reciprocal free trade agreements, 5 preferential trade programs, 51 trade and
investment framework agreements, 48 bilateral investment treaties, trade remedies, a trade
agreement enforcement program, trade and development programs, measures which affect
imports (e.g. Customs regulations), measures that affect exports (e.g., export promotion), and
sector programs (e.g., subsidies to agriculture).

Multilateral Trade Agreements:

What is multilateral trade agreement?

A multilateral agreement is a trade agreement established between three or more
countries with the intention of reducing barriers to trade, such as tariffs, subsidies, and
embargoes, that limit a nation's ability to import or export goods.

Which trade organization is responsible for 90% of the world's trade?

Which trade organization is responsible for 90% of the world's trade? The WTO. An
important task facing the WTO is that of making the new multilateral trading system truly
global in scope and application. The 140 Members of the WTO (as of 31 December 2000)
account for more than 90% of world trade.

Bilateral Trade Agreements

 The United States has 14 Free Trade Agreements (FTAs) with 20 countries in force:
Australia, Bahrain, Canada, Chile, Colombia, Costa Rica, Dominican Republic, El
Salvador, Guatemala, Honduras, Israel, Jordan, Mexico, Morocco, Nicaragua, Oman,
Panama, Peru, Singapore, and South Korea.

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United States free-trade agreements
Beginning with the Theodore Roosevelt administration, the United States became a major
player in international trade, especially with its neighboring territories in the Caribbean and
Latin America. Today, the United States has become a leader of the free trade movement,
standing behind groups such as the General Agreement on Tariffs and Trade (later the World
Trade Organization).[

  Israel: Israel–United States Free Trade Agreement (includes Palestinian Authority;

1985)
  Jordan: Jordan–United States Free Trade Agreement (2001)
  Australia: Australia–United States Free Trade Agreement (2004)
  Chile: Chile–United States Free Trade Agreement (2004)
  Singapore: Singapore–United States Free Trade Agreement (2004)
  Bahrain: Bahrain–United States Free Trade Agreement (2006)
  Morocco: Morocco–United States Free Trade Agreement (2006)
  Oman: Oman–United States Free Trade Agreement (2006)
  Peru: Peru–United States Trade Promotion Agreement (2007)
 Dominican Republic–Central America Free Trade Agreement (DR-
CAFTA; includes Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the
Dominican Republic; 2009)
  South Korea: United States–South Korea Free Trade Agreement (2010)[1]
  Colombia: United States–Colombia Free Trade Agreement (2012)[2]
  Panama: Panama–United States Trade Promotion Agreement (2012)[3]
  Japan: United States–Japan Trade Agreement (2020)
  Mexico  Canada: United States–Mexico–Canada Agreement (USMCA) (2020;
replaces NAFTA)[4]

USMCA:
On July 1, 2020, the new United States-Mexico- Canada (USMCA) Agreement came into
force. This Agreement replace the North American Free Trade Agreement (NAFTA), a
regional pact in place since 1994. 

This new Agreement concerns an area of 489 milion inhabitants and with a GDP (Gross
Domestic Product) per capita of around $49,000 USD. Mexico and Canada displaced China as
the main trade partners of the United States in 2019.  Just an example: 79% of the Mexican
exports went to the USA in 2019 and 75% of the Canadian exports went to USA in 2019.

 The former NAFTA eliminated already most tariffs on products traded between the three
countries, with a major focus on liberalizing trade in agriculture, textiles, and automobile
manufacturing. Since its implementation, NAFTA benefited the economy through increasing
overall trade to over 1 trillion USD between the three countries.

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Some of the Key aspects of this new Agreement, which have to be underlined, are:

 Country of origin (Domestic Content) rules: Automobiles companies must have 75

percent of their components manufactured in Mexico, the United States, or Canada to
qualify for zero tariffs (up from 62.5 percent under NAFTA). 
 Labor provisions: 40 to 45 percent of automobile parts must be made by workers
who earn at least $16 an hour by 2023. Mexico agreed to pass new labor laws to give
greater protections to workers, including migrants and women. 

 Intellectual property and digital trade: The deal extends the terms of copyright to
70 years beyond the life of the author (up from 50). It also includes new provisions to
deal with the digital economy: the USMCA establishes rules for digital trade and
digital technologies such as e-books, videos, music, software and games (much of
these technologies didn’t exist and weren’t addressed when NAFTA went into effect
in 1994).

 Sunset clause: The agreement can be extended for additional 16-year terms during the
six-year reviews. The introduction of the sunset clause places more control in shaping
the future of the USMCA in the hands of domestic governments. On the sixth
anniversary of its entry into force, a “joint review” of the agreement must be
conducted by the parties.
 
 Textiles: Revised rules were added to incentivize use of regional inputs with
requirements to source sewing thread, narrow elastic fabrics, pocketing, and coated
fabrics from within North America.

 Customs and Trade Facilitation

  
 Enforcement of Environmental Standards: This includes commitment to enforce
environmental laws
 The goals of the USMCA are to eliminate barriers to trade, strengthen the internal market,
increase investment opportunities and enhance the competitiveness of the area. We also hope
so.

KORUS FTA (South Korea)

The trade agreement involves an estimated 362 million consumers in the United States and
the Republic of Korea.[citation needed] The treaty's provisions eliminate 95% of each nation's tariffs
on goods within five years, and create new protections for multinational financial services
and other firms.[4] For the United States, the treaty was the first free trade agreement (FTA)
with a major Asian economy and the largest trade deal since the North American Free Trade
Agreement (NAFTA) in 1993. For South Korea, the KORUS FTA is second in size only to the
FTA signed with the European Union[10] and dwarfs other FTAs signed with Chile, Singapore,
the European Free Trade Area and the Association of Southeast Asian Nations (ASEAN).[11]