Trump administration plans new trade talks with EU, UK, Japan

Congressional approval must be granted under fast-track rules

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Washington | Reuters – The United States Trade Representative’s office told Congress in mid-October it intends to open trade talks with the European Union, the United Kingdom and Japan.

Under fast-track rules, the United States cannot start talks with the EU, Japan and the United Kingdom until 90 days after notifying Congress.

Why it matters: The United Kingdom, the European Union and Japan represent three of the U.S.’s largest trading partners. New trade agreements between them and the U.S. would significantly alter existing trade patterns and change how Canada markets its commodities.

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“We will continue to expand U.S. trade and investment by negotiating trade agreements with Japan, the EU and the United Kingdom,” U.S. Trade Representative Robert Lighthizer said in a statement.

“We are committed to concluding these negotiations with timely and substantive results for American workers, farmers, ranchers, and businesses.”

The letters from Lighthizer to Congress come weeks after the United States won agreement on reworking the North American Free Trade Agreement (NAFTA) with Mexico and Canada, and as the administration faces continuing trade friction with China.

The administration aims to “address both tariff and non-tariff barriers and to achieve fairer, more balanced trade” with the EU and Japan, the letters said.

Japan “is an important but still too often underperforming market for U.S. exporters of goods,” the letter said. It said the United States had a US$69-billion trade deficit in goods with Japan, much of that in the auto sector.

In Tokyo, chief cabinet secretary Yoshihide Suga said Japan would protect its interests, based on a joint statement issued at a Japan-U.S. summit on Sept. 26.

“It will not be an easy negotiation,” Suga told a regular news conference.

“But we would like to proceed with talks in line with our stance that we will push where necessary and defend our position where necessary, in a way that protects our national interests.”

The letter on the EU said the EU and the U.S. have $1.1 trillion in annual two-way trade, “the largest and most complex” economic relationship in the world, and added that the U.S. has a $151.4 billion trade deficit in goods.

The letter to Congress on Britain said it planned to start talks “as soon as it is ready” after Britain exits the EU on March 29. The U.S. wants to develop “cutting edge obligations for emerging sectors where U.S. and U.K. innovators and entrepreneurs are most competitive.”

Representative Kevin Brady, the chair of the House Ways and Means Committee, said, “These three economies are some of our largest and most important trading partners, but they are also markets in which U.S. farmers, manufacturers, and service providers face significant barriers.”

Senator Ron Wyden, the top Democrat on the Finance Committee that oversees trade issues, said, “The administration must take the time to tackle trade barriers comprehensively.”

He urged that the opportunity be used to set a high bar in areas such as labour rights, environmental protection and digital trade to benefit American workers and businesses, adding that “a quick, partial deal that only addresses some problems” should be avoided.

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