Trump could implement a 20 percent tariff on foreign imports.
President Donald Trump is all set to sign two executive orders on Friday, which is seen as a move to fulfil his campaign promise to make trade fairer.
It has been learned that the first executive order will commission a report on trade practices that caused the trade deficit and the second one will seek better collection of anti-dumping and countervailing duties.
The executive orders phrased by the Commerce Department and US Trade Representatives targets identifying trade abuses and “non-reciprocal practice†that led to the deficit in trade.
The first report will make its way back to the Oval Office within a span of 90 days, specifying the details of the reasons that caused the trade deficit.
The second executive directive will provide the federal agencies with better tools for enforcing the existing penalties for unfair trade practice.
According to the estimates provided by the White House National Trade Council director Peter Navarro, the enforcement agencies have failed to recover close to $2.8 million anti-dumping and countervailing duties from foreign trade partners since 2001.
According to the Commerce Secretary Wilbur Ross, once the report is submitted, it will provide a very in-depth understanding of the current condition so that important decisions on trade can be implemented.
Ross also said that the report will give the Trump administration the right direction to take a “measured and analytical approach” and not do anything in haste without careful understanding.
“What’s driving it is that the U.S. has the lowest tariff rates and the lowest non-tariff barriers of any developed country. While other countries talk about free trade, they actually are far more protectionist than we are,” Ross said on Thursday.
Ross is certain that the report will find the reasons that caused the trade deficit that could include lax enforcement, asymmetrical rules or currency misalignment.
Earlier on Thursday acting US Trade Representative Steve Vaughn had sent the framework created by the administration in order to renegotiate the North American Free Trade agreement with Canada and Mexico.
During his campaign trail, Trump had campaigned for revising the trade agreements for making it favourable to the American firms and workers. He also said that the NAFTA agreement is the worst trade deal ever signed.
The first thing that Trump did soon after taking charge of the office was to official back from the Trans-Pacific Partnership. The Trans-Pacific Partnership is a 12-nation Pacific Rim trade accord negotiated by former President Barack Obama.
This will be marked as the third attempt by Trump to showcase his power as the US President, the first two – travel ban and scrapping of Obamacare had backfired causing major embarrassment to the administration.
Trump has the support of many democrats and labor unions who support the idea of a thoroughly reworked trade relationships and agreements that can give more opportunities to American workforce.
Ross claimed that “there never has been this kind of systemic analysis.â€
He also confirmed that the executive orders are not aimed at sending a wrong signal to China ahead of the visit of Chinese President Xi Jinping next week.
The meeting next week with China will be a very difficult one in that we can no longer have massive trade….contâž¡ï¸https://t.co/dgoliP8yhI
— President Trump 45 Archived (@POTUS45) March 31, 2017
The study will give a great deal of detail to the trade relationship of the US with very significant countries like China, Japan, Germany, Mexico and Ireland.
The study will also focus on the ways in which US was restricted access to particular markets and also will analyses the effect of currency devaluation on the US. It will also look into the past enforcement policies and World Trade Organization rules that hamper US companies’ competitiveness.
“Undoubtedly with some of the countries we will conclude that there is no real action that should be taken,†Ross emphasized.
An earlier statement of White House Press Secretary had mentioned that the Trump could implement a 20 percent tariff on foreign imports and this could be eventually lead Mexico to fund for building a border wall proposed by Trump during his campaign.
The assessment “will demonstrate the depth of the administration’s intention not to hip-shoot, not to do anything casual, not to do anything abruptly, but to take a very measured and analytical approach both to analyzing the problem and therefore to developing the solutions for it,†he said.