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RPT-FACTBOX-Biden trade czar Katherine Tai's to-do list: China tariffs to UK post-Brexit

Thu 25th February, 2021 3:27pm
(Repeating Feb. 24 story for wider distribution, no change to
content)
    By Andrea Shalal and David Lawder
    WASHINGTON, Feb 24 (Reuters) - Katherine Tai, President Joe
Biden's nominee for U.S. Trade Representative, will have a full
inbox waiting if she is confirmed by the U.S. Senate after a
confirmation hearing on Thursday.
    U.S. allies, global corporations, domestic industries and
labor groups are eager to see how she will address the upheaval
after President Donald Trump's "America First" trade policies.
    Here are the top issues: 
             
    EUROPE AND AIRCRAFT SUBSIDIES
    Four U.S. administrations have argued with Europe over past
government aid to aircraft manufacturers since 2004. After WTO
rulings, both Washington and Brussels put tariffs on billions of
dollars of aircraft and food and wine imports. 
    The restaurant and the liquor industry will press Tai to
reach a deal and lift these, while Boeing Co  BA.N , the top
U.S. exporter, wants European tariffs on its aircraft lifted as
it resumes deliveries of its 737 MAX.
    Whether the United States or Europe should allow new
subsidies on aircraft is another dilemma, and Brazil is now
pushing for an agreement outside the World Trade Organization.
 urn:newsml:reuters.com:*:nL1N2KO1H6  
    Broader U.S.-EU trade talks, which previously stalled over
agriculture imports, steel and aluminum tariffs, aren't likely a
first priority. 
    
    REFORMING THE WTO
    Tai will lead U.S. efforts to reform the WTO, widely
criticized for failing to rein in China's trade and subsidy
practices.
    Reversing Trump opposition, the Biden administration has
cleared the way for Nigeria's Ngozi Okonjo-Iweala to be director
general on March 1.  urn:newsml:reuters.com:*:nL1N2KL1DM
    One of Tai's first WTO decisions will be whether to back a
temporary intellectual property rule waiver sought by India and
South Africa to speed vaccine production in poor regions,
potentially upsetting U.S. industry. Okonjo-Iweala has warned
against "vaccine nationalism" by rich countries.
    The WTO's Appellate Body, a kind of a supreme court of
global trade, was disabled after Trump blocked appointments of
new judges. Tai is expected to review that decision but it could
take time to rebuild the dispute settlement process. 
    
    FISHERY SUBSIDIES
    WTO members missed an end-2020 deadline for a deal to cut 
subsidies that have helped decimate the world's fish stocks.
 urn:newsml:reuters.com:*:nL1N2IU0K0
    Since its launch in 1995, the WTO has concluded only one new
 trade agreement. If this one comes together, WTO insiders joke,
it won't be the WTO that will save fish, but fish that will save
the WTO.
    
    POST-BREXIT U.K.  
    Britain and the United States started formal talks on a new
bilateral trade agreement last year, after Britain's exit from
the European Union. 
    The Trump administration floated a "mini" trade deal, but it
is unclear whether Tai will seal it, or try for a more
comprehensive agreement.
    
    CONGRESSIONAL TRADE PROMOTION AUTHORITY
    Tai will also lead negotiations with Congress to renew 
Trade Promotion Authority (TPA), the "fast-track" negotiating
powers granted the U.S. president that are due to expire on July
1. Comprehensive trade deals are largely impossible without it. 
    Democrats who control Congress want new labor and climate
change standards, as well as stronger congressional involvement
in developing trade policy. As a congressional staffer, Tai
chafed at Trump's actions to negotiate deals without consulting
Congress.
    
    DIGITAL SERVICES TAXES
    Treasury Secretary Janet Yellen has vowed to dive back into
multilateral negotiations on global taxation of tech firms that
Group of Seven officials hope to wrap up by mid-2021.
    Under Trump, USTR threatened tariffs on French goods over
France's digital services tax, which Washington said
discriminates against U.S. tech firms. It also found similar
problems in Britain, Austria and four other countries.
 urn:newsml:reuters.com:*:nL1N2JP1YQ
        
    CHINA TARIFFS
    Tai's team also needs to evaluate the "Phase 1" U.S.-China
trade deal. China's purchases of U.S. goods and services in 2020
fell 42% short of targets set in the accord.
    U.S. companies want China's industrial subsidies and
non-tariff barriers removed, and intellectual property
protections expanded, in exchange for easing tariffs on some
$370 billion in Chinese goods. 
    Biden officials have said tariffs will remain in place for
now, and have pledged to work with U.S. allies to put more
pressure on China to change what they call "abusive" practices. 
    
    JAPAN AND KENYA 
    U.S. lawmakers and rice farmers, meanwhile, are pushing
Washington to start talks with Japan about a comprehensive trade
agreement after a less-than-satisfying mini-deal signed by the
Trump administration.  urn:newsml:reuters.com:*:nL2N2801OG
    The Trump administration also launched talks with Kenya on a
bilateral trade pact that could serve as a model for additional
agreements across the African continent.  urn:newsml:reuters.com:*:nL1N2EF11J

 (Reporting by Andrea Shalal; Additional reporting by David
Lawder in Washington and Phil Blenkinsop in Brussels; Editing by
Heather Timmons and Sam Holmes)
 ((andrea.shalal@tr.com; +1 202-815-7432;))
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