Insights from USTR’s NTE Report
Last week USTR published its 38th annual “National Trade Estimate Report on Foreign Trade Barriers”. Coming just a few weeks after the March 1, 2023 release of the 2023 President’s Trade Agenda, this offers insights into issues around EU-US trade policy as well as US perspectives on global value chain regulation. Plus it has a handy country-by-country breakdown. So it’s worth a read. A couple of takeaways:The report comments on the EU’s regulatory approach. It identifies that “U.S. exporters face a proliferation of technical barriers to trade (TBT) in the EU”. The report also refers to the emergence of new European Standards across a range of sectors and EU efforts to regulate emerging technology.
Technical Barriers to Trade are not as such WTO incompatible – WTO Members are entitled to regulatory autonomy provided the measures are non-discriminatory and are linked to a legitimate objective. But more regulations entails more effort for industry to keep compliant. And the EU is using product standards and other technical requirements as a means to further environmental aims and implement the Green Deal. The EU notifies its new technical regulations to the TBT Committee at the WTO in accordance with the transparency rules set down in the TBT Agreement.
The report highlights forced labour as an issue of concern. Not just in relation to China (see page 95). The Dominican Republic is also mentioned. Moreover, concerns over forced labour are not just related to the Xinjiang Uyghur Autonomous Region. Illegal, Unreported, and Unregulated Fishing (IUU) is highlighted as an issue which could have global implications if left unchecked. To recap, this was a point the US sought to raise at the multilateral level in the context of the negotiations of the new Fisheries Agreement in the WTO. Could this herald further action in the future?
Finally, its worth bearing in mind that as acknowledged in the report itself, the NTE Report covers what the US perceives to be significant trade barriers, irrespective of whether they are considered consistent or inconsistent with international trading rules (i.e. WTO). Indeed, the views expressed by the US on WTO consistency are not necessarily shared. But at the least, this shows where Members diverge. 