Archive for the ‘trade’ Category

New From the GAO

September 28, 2012 Comments off

New GAO Reports

Source: Government Accountability Office

1. Warfighter Support: DOD Should Improve Development of Camouflage Uniforms and Enhance Collaboration Among the Services. GAO-12-707, September 28.
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2. VA and DOD Health Care: Department-Level Actions Needed to Assess Collaboration Performance, Address Barriers, and Identify Opportunities. GAO-12-992, September 28.
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3. Government Contracting: Federal Efforts to Assist Small Minority Owned Businesses. GAO-12-873. September 28.
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4. Trade Adjustment Assistance: Changes to the Workers Program Benefited Participants, but Little Is Known about Outcomes. GAO-12-953, September 28
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5. Trade Adjustment Assistance: Labor Awarded Community College Grants in Accordance with Requirements, but Needs to Improve Its Process. GAO-12-954, September 28.
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6. Department of Homeland Security: Efforts to Assess Realignment of Its Field Office Structure. GAO-12-185R, September 28.

Hidden Dragon, Crouching Lion: How China’s Advance in Africa is Underestimated and Africa’s Potential Underappreciated

September 25, 2012 Comments off

Hidden Dragon, Crouching Lion: How China’s Advance in Africa is Underestimated and Africa’s Potential Underappreciated

Source: Strategic Studies Institute, U.S. Army War College

The explosive growth of China’s economic interests in Africa—bilateral trade rocketed from $1 billion in 1990 to $150 billion in 2011—may be the most important trend in the continent’s foreign relations since the end of the Cold War. In 2010, China surpassed the United States as Africa’s top trading partner; its quest to build a strategic partnership with Africa on own its terms through tied aid, trade, and development finance is also part of Beijing’s broader aspirations to surpass the United States as the world’s preeminent superpower. Africa and other emerging economies have become attractive partners for China not only for natural resources, but as growing markets. Africa’s rapid growth since 2000 has not just occurred because of higher commodity prices, but more importantly due to other factors including improved governance, economic reforms, and an expanding labor force. China’s rapid and successful expansion in Africa is due to multiple factors, including economic diplomacy that is clearly superior to that of the United States. China’s “no strings attached” approach to development, however, risks undoing decades of Western efforts to promote good governance. Consequently, this monograph examines China’s oil diplomacy, equity investments in strategic minerals, and food policy toward Africa. The official U.S. rhetoric is that China’s rise in Africa should not be seen as a zero-sum game, but areas where real U.S.-China cooperation can help Africa remain elusive, mainly because of Beijing’s hyper-mistrust of Washington. The United States could help itself, and Africa, by improving its own economic diplomacy and adequately funding its own soft-power efforts.

Economic Freedom of the World: 2012 Annual Report

September 18, 2012 Comments off

Economic Freedom of the World: 2012 Annual Report

Source: Fraser Institute

The index published in Economic Freedom of the World 2012 measures the degree to which the policies and institutions of countries are supportive of economic freedom. The cornerstones of economic freedom are personal choice, voluntary exchange, freedom to compete, and security of privately owned property. Forty-two variables are used to construct a summary index and to measure the degree of economic freedom in five broad areas: (1) size of government; (2) legal system and property tights; (3) sound money; (4) freedom to trade internationally; and (5) regulation.

Measuring the Costs of the Canada-US Border

September 14, 2012 Comments off

Measuring the Costs of the Canada-US Border

Source: Fraser Institute

Key findings

+ After ten years of post-9/11 border innovations, the costs associated with border crossing have not significantly decreased while government spending on border security has markedly increased. In order to develop performance-based and cost-effective border management policies, an outline of costs associated with the border is required.

+ After adding up the lowest values from the estimated ranges for all three types of costs (trade, tourism/travel, and government programs), we find an annual cost of C$19.1 billion in 2010 or nearly 1.5% of Canada’s GDP.

+ Canadian and American governments should provide detailed descriptions of costs and expenditures for specific border programs and new security measures. Furthermore, these costs/expenditures must be linked to expected outcomes and timelines. "Costs and Results" based evaluations should be undertaken on a year-to-year basis, and subsequently made public.

+ In December 2011, the governments of Canada and the United States issued a joint declaration called Beyond the Border: A Shared Vision for Perimeter Security and Economic Competitiveness. While the vision provides specific benchmarks and timelines for measuring progress, it does not tie these guidelines to government expenditures, or reductions in border crossing costs. Either we will continue with incremental and uncoordinated programs, creating some improvements but not lowering the overall cost of the border, or we will begin to create a new border regime.

New From the GAO

September 13, 2012 Comments off

New GAO Reports and Testimonies

Source: Government Accountability Office

+ Reports

1. Biosurveillance: DHS Should Reevaluate Mission Need and Alternatives before Proceeding with BioWatch Generation-3 Acquisition. GAO-12-810, September 10.
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2. Securities Investor Protection Corporation: Customer Outcomes in the Madoff Liquidation Proceeding. GAO-12-991, September 13.
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3. Public Financial Management: Improvements Needed in USAID’s and Treasury’s Monitoring and Evaluation Efforts. GAO-12-920, September 13.
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4. Slot-Controlled Airports: FAA’s Rules Could Be Improved to Enhance Competition and Use of Available Capacity. GAO-12-902, September 13.
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5. Trade Adjustment Assistance: Commerce Program Has Helped Manufacturing and Services Firms, but Measures, Data, and Funding Formula Could Improve. GAO-12-930, September 13.
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Related Product

Trade Adjustment Assistance: Results of GAO’s Survey of Participant Firms in the Trade Adjustment Assistance for Firms Program (GAO-12-935SP, September 2012), an E-supplement to GAO-12-930. GAO-12-935SP, September 13.

6. World Food Program: Stronger Controls Needed in High-Risk Areas. GAO-12-790, September 13.
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7. Industrial Base: U.S. Tactical Wheeled Vehicle Manufacturers Face Period of Uncertainty as DOD Purchases Decline and Foreign Sales Potential Remains Unknown. GAO-12-859, September 13.
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8. Community Banks and Credit Unions: Impact of the Dodd-Frank Act Depends Largely on Future Rule Makings. GAO-12-881, September 13.
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9. Debt Collection Improvement Act of 1996: Status of Treasury’s Centralized Efforts to Collect Delinquent Federal Nontax Debt. GAO-12-870R, September 13.

10. Financial Stability: New Council and Research Office Should Strengthen the Accountability and Transparency of Their Decisions. GAO-12-886, September 11.
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+ Testimonies

1. Spectrum Management: Federal Government’s Use of Spectrum and Preliminary Information on Spectrum Sharing, by Mark L. Goldstein, director, physical infrastructure issues, before the Subcommittee on Communications and Technology, House Committee on Energy and Commerce. GAO-12-1018T, September 13.
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2. Biosurveillance: Observations on BioWatch Generation-3 and Other Federal Efforts, by William O. Jenkins, Jr., director, homeland security and justice, before the Subcommittees on Emergency Preparedness, Response, and Communications and Cybersecurity, Infrastructure Protection, and Security Technologies, House Homeland Security Committee. GAO-12-994T, September 13.
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Latino Immigrant Entrepreneurs: How to Capitalize on Their Economic Potential

September 11, 2012 Comments off

Latino Immigrant Entrepreneurs: How to Capitalize on Their Economic Potential

Source: Council on Foreign Relations

Latino immigrant entrepreneurs are making important yet largely overlooked contributions to the U.S. economy. With expanding Latino markets at home and abroad, their economic impact is set to grow. But roadblocks stand in the way. Policy changes–including visa reform, improving access to credit, and a more ambitious trade agenda with Latin American countries–would help the United States unlock the full potential of its Latino immigrant entrepreneurs.

Research project on the impact of anti-dumping investigations on UK business: final report

August 17, 2012 Comments off

Research project on the impact of anti-dumping investigations on UK business: final report (PDF)

Source:  Department for Business Innovation & Skills

Report for BIS that analyses the impact of anti-dumping investigations and procedures on UK business. Based on a survey of UK companies. See also URN 12/1021AN for a graphical representations of the data collected in the report.

Ensuring Canadian Access to Oil Markets in the Asia-Pacific Region

August 10, 2012 Comments off

Ensuring Canadian Access to Oil Markets in the Asia-Pacific Region
Source: Fraser Institute

This report provides a comprehensive overview of the outlook for Alberta crude oil and bitumen production and an assessment of the economic attractiveness and feasibility of exporting oil to countries in the Asia-Pacific region instead of solely to markets in the United States. It also describes the extent of the new oil pipeline infrastructure that would be needed to allow oil exports to Asia-Pacific region under two scenarios: 1. no increase in oil sands bitumen production capacity from a base-case forecast; and 2. bitumen production capacity increased from that in the base case to supply Asian markets after 2026. The likely gross employment and overall economic (GDP) benefits from construction and operation of the required facilities are also discussed.

The report also examines unnecessary regulatory and other barriers that are inhibiting the development of the pipelines and port facilities required to ship crude oil, raw bitumen and synthetic crude oil (i.e., upgraded bitumen) to the west coast and on to oil refineries in Japan, Korea, China, India and other countries in Asia that are increasingly becoming dependent on oil imports.

Ten Steps to Delivering a Successful Metro Export Plan

August 8, 2012 Comments off

Ten Steps to Delivering a Successful Metro Export Plan

Source: Brookings Institution

Many leaders in states, cities, and metropolitan areas across the country are exploring ways to help their firms tap into expanding markets worldwide to grow jobs at home. This brief serves as a how-to-guide for private, nonprofit, and government leaders in metro areas who are interested in developing effective action-oriented metropolitan export plans and initiatives customized to their region’s unique assets and capacities. It builds on lessons learned from a one-year pilot (2011–2012) where the Metropolitan Policy Program at Brookings collaborated with leaders in four metro areas to develop localized export plans.

Reach for the skies: a strategic vision for UK aerospace

July 12, 2012 Comments off

Reach for the skies: a strategic vision for UK aerospace (PDF)
Source: Department for Business Innovation & Skills

A joint report from industry and government identifying the huge opportunity for growth in the UK aerospace sector, and the threat of increasing competition from established and developing nations.

US Election Note: International Trade Policy after 2012

June 29, 2012 Comments off

US Election Note: International Trade Policy after 2012
Source: Chatham House

The 2012 presidential election is occurring as the US economy emerges from a significant recession. While trade is a small part of the campaign debate, it remains an emotional ‘wedge issue’ for the electorate. This paper lays out the likely trade policy of either a second-term Barack Obama administration or an incoming Mitt Romney administration.

CRS — U.S. Trade Deficit and the Impact of Changing Oil Prices

June 26, 2012 Comments off

U.S. Trade Deficit and the Impact of Changing Oil Prices (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

Petroleum prices rose sharply between January 2012 and April 2012, at times reaching more than $109 per barrel of crude oil. Although this is still below the $140 per barrel price reached in 2008, the rising cost of energy was one factor that helped to dampen the rate of growth in the economy during the second half of 2011 and the first half of 2012. While the price of oil was rising, the volume of oil imports, or the amount of oil imported, decreased slightly from the comparable period in the previous year. In general, market demand for oil remains highly resistant to changes in oil prices and reflects the unique nature of the demand for oil. In addition, sustained demand for oil in the face of higher prices reflected an increase in economic activity that occurred following the worst part of the economic recession in 2009. Turmoil in the Middle East was an important factor causing petroleum prices to rise sharply in early 2011 and in 2012. Although prices for imported oil fluctuated somewhat throughout 2011, they averaged 30% higher than in 2010 and added about $100 billion to the total U.S. trade deficit in 2011. Oil futures markets in June indicated that oil prices were expected to fluctuate around the $83 per barrel recorded in June 2012, in part because oil producers agreed in mid-June to maintain the then-current production levels to stabilize market prices. The increase in energy import prices in 2011 pushed up the price of energy to consumers. In such cases, some elements of the public tend to pressure Congress to provide relief to households that are struggling to meet their current expenses. This report provides an estimate of the initial impact of the changing oil prices on the nation’s merchandise trade deficit.

CRS — Free Trade Agreements: Impact on U.S. Trade and Implications for U.S. Trade Policy

June 26, 2012 Comments off

Free Trade Agreements: Impact on U.S. Trade and Implications for U.S. Trade Policy (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

Free trade areas (FTAs) are arrangements among two or more countries under which they agree to eliminate tariffs and nontariff barriers on trade in goods among themselves. However, each country maintains its own policies, including tariffs, on trade outside the region.

In the last few years, the United States has engaged or has proposed to engage in negotiations to establish bilateral and regional free trade arrangements with a number of trading partners. Such arrangements are not new in U.S. trade policy. The United States has had a free trade arrangement with Israel since 1985 and with Canada since 1989, which was expanded to include Mexico and became the North American Free Trade Agreement (NAFTA) effective in January 1994.

U.S. interest in bilateral and regional free trade arrangements surged, and the Bush Administration accelerated the pace of negotiations after the enactment of the Trade Promotion Authority in August 2002. U.S. participation in free trade agreements can occur only with the concurrence of Congress. In addition, FTAs affect the U.S. economy, with the impact varying across sectors.

The 112th Congress and the Obama Administration faced the question of whether and when to act on three FTAs pending from the Bush Administration—with Colombia, Panama, and South Korea. Although the Bush Administration signed these agreements, it and the leaders of the 110 th Congress could not reach agreement on proceeding to enact them. No action was taken during the 111 th Congress either.

After discussion with congressional leaders and negotiations with the governments of Colombia, Panama, and South Korea to assuage congressional concerns regarding treatment of union officials (Colombia), taxation regimes (Panama), and trade in autos (South Korea), President Obama submitted draft implementing legislation to Congress on October 3, 2011. The 112th Congress approved each of the bills in successive votes on October 12, along with legislation to renew an aspect of the Trade Adjustment Assistance (TAA) program. President Obama signed the bills into law on October 21, 2011.

In the meantime, on November 14, 2009, President Obama committed to work with the current and prospective members of the Trans-Pacific Strategic Economic Partnership Agreement (TPP). The TPP is a free trade agreement that includes nations on both sides of the Pacific. The TPP, which originally came into effect in 2006, currently includes Brunei, Chile, New Zealand, and Singapore. Besides the United States, Australia, Peru, and Vietnam have joined the negotiations.

In addition, Canada, Japan, and Mexico have expressed interest in joining. FTAs raise some important policy issues: Do FTAs serve or impede U.S. long-term national interests and trade policy objectives? Which type of an FTA arrangement meets U.S. national interests? What should U.S. criteria be in choosing FTA partners? Are FTAs a substitute for or a complement to U.S. commitments and interests in promoting a multilateral trading system via the World Trade Organization (WTO)? What effect will the expiration of TPA have on the future of FTAs as a trade policy strategy?

Spotlight on Statistics: Fashion

June 24, 2012 Comments off

Spotlight on Statistics: Fashion
Source: Bureau of Labor Statistics

Throughout history, fashion has greatly influenced the “fabric” of societies all over the world. What people wear often characterizes who they are and what they do for a living. As Mark Twain once wrote, “Clothes make the man. Naked people have little or no influence on society.”

The fashion industry is a global industry, where fashion designers, manufacturers, merchandisers, and retailers from all over the world collaborate to design, manufacture, and sell clothing, shoes, and accessories. The industry is characterized by short product life cycles, erratic consumer demand, an abundance of product variety, and complex supply chains.

In this Spotlight, we take a look at the fashion industry’s supply chain—including import and producer prices, employment in the apparel manufacturing and fashion-related wholesale and retail trade industries, labor productivity in the manufacturing sector and in selected textile and apparel industries, and consumer prices and expenditures on apparel-related items.

CRS — U.S.-Taiwan Relationship: Overview of Policy Issues

June 19, 2012 Comments off

U.S.-Taiwan Relationship: Overview of Policy Issues (PDF)
Source: Congressional Research Service (via Federation of American Scientists)

The purpose and scope of this CRS Report is to provide a succinct overview with analysis of the issues in the U.S.-Taiwan relationship. This report will be updated as warranted. Taiwan formally calls itself the sovereign Republic of China (ROC), tracing its political lineage to the ROC set up after the revolution in 1911 in China. The ROC government retreated to Taipei in 1949. The United States recognized the ROC until the end of 1978 and has maintained a non-diplomatic relationship with Taiwan after recognition of the People’s Republic of China (PRC) in Beijing in 1979. The State Department claims an “unofficial” U.S. relationship with Taiwan, despite official contacts that include arms sales. The Taiwan Relations Act (TRA) of 1979, P.L. 96-8, has governed policy in the absence of a diplomatic relationship or a defense treaty. Other key statements that guide policy are the three U.S.-PRC Joint Communiques of 1972, 1979, and 1982; as well as the “Six Assurances” of 1982. (See also CRS Report RL30341, China/Taiwan: Evolution of the “One China” Policy—Key Statements from Washington, Beijing, and Taipei.)

For decades, Taiwan has been of significant security, economic, and political interest to the United States. In 2011, Taiwan was the 10 th -largest U.S. trading partner and the 6 th -largest market for U.S. agricultural exports. Taiwan is a major innovator of information technology (IT) products. Ties or tension across the Taiwan Strait affect international security (with potential U.S. intervention), the U.S.-Taiwan relationship, and U.S.-PRC cooperation. While the United States does not diplomatically recognize Taiwan, it is a significant autonomous actor in the world. Today, 23 countries including the Vatican have diplomatic relations with Taiwan as the ROC. Taiwan’s 23 million people enjoy self-governance with free elections. After Taiwan’s presidential election in 2008, the United States congratulated Taiwan as a “beacon of democracy.” Taiwan’s democracy has allowed its people a greater say in their status, given competing party politics about Taiwan’s national political identity and priorities. Taiwan held presidential and legislative elections on January 14, 2012. Kuomintang (KMT) President Ma Ying-jeou won re-election against the candidate from the Democratic Progressive Party (DPP).

Since Taiwan and the PRC resumed their quasi-official dialogue in 2008 under President Ma and cross-strait tension decreased, some have stressed concerns about steps seen as needed to be taken by the United States and by Taiwan to strengthen their relationship. Another approach has viewed closer cross-strait engagement as allowing U.S. attention to shift to expand cooperation with a rising China, which opposes U.S. arms sales and other dealings with Taiwan. In any case, Washington and Taipei have put more efforts into their respective relations with Beijing, while contending that they have pursued a positive, parallel U.S.-Taiwan relationship.

Taiwan’s President Ma Ying-jeou has sought U.S. support for his policies, including U.S. arms sales and Taiwan’s inclusion in the U.S. Visa Waiver Program (VWP). Taiwan also has asked for an extradition treaty. Another U.S. policy issue has concerned whether to resume Cabinet-level visits. The United States and Taiwan have sought to resume trade talks under the Trade and Investment Framework Agreement (TIFA), but there have been U.S. concerns about Taiwan’s restrictions on U.S. beef. Taiwan seeks support for participation in international organizations.

Legislation in the 112 th Congress include H.Con.Res. 39, H.Con.Res. 77, H.Con.Res. 122, H.R. 2583, H.R. 2918, H.R. 2992, H.R. 4310, H.R. 5902, S. 1539, S. 1545, and S.Con.Res. 17. Other congressional actions have focused on arms sales to Taiwan, particularly the issue of whether to sell F-16C/D fighters. (See CRS Report RL30957, Taiwan: Major U.S. Arms Sales Since 1990.)

The Potential Impact of Changes in Immigration Policy on U.S. Agriculture and the Market for Hired Farm Labor: A Simulation Analysis

June 7, 2012 Comments off

The Potential Impact of Changes in Immigration Policy on U.S. Agriculture and the Market for Hired Farm Labor: A Simulation Analysis
Source: U.S. Department of Agriculture, Economic Research Service

Large shifts in the supply of foreign-born, hired farm labor resulting from substantial changes in U.S. immigration laws or policies could have significant economic implications. A computable general equilibrium (CGE) model of the U.S. economy is used to evaluate how changes in the supply of foreign-born labor might affect all sectors of the economy, including agriculture. Two scenarios are considered: an increase in the number of temporary nonimmigrant, foreign-born farmworkers, such as those admitted under the H-2A Temporary Agricultural Program, and a decrease in the number of unauthorized workers in all sectors of the economy. Longrun economic outcomes for agricultural output and exports, wages and employment levels, and national income accruing to U.S.-born and foreign-born, permanent resident workers in these two scenarios are compared with a base forecast reflecting current immigration laws and policies.

CRS — The U.S. Export Control System and the President’s Reform Initiative

May 29, 2012 Comments off

The U.S. Export Control System and the President’s Reform Initiative(PDF)
Source: Congressional Research Service (via Federation of American Scientists)

The 112 th Congress may consider reforms of the U.S. export control system. The balance between national security and export competitiveness has made the subject of export controls controversial for decades. Through the Export Administration Act (EAA), the Arms Export Control Act (AECA), the International Emergency Economic Powers Act (IEEPA), and other authorities, the United States restricts the export of defense items or munitions; so-called “dual-use” goods and technology—items with both civilian and military applications; certain nuclear materials and technology; and items that would assist in the proliferation of nuclear, chemical, and biological weapons or the missile technology used to deliver them. U.S. export controls are also used to restrict exports to certain countries on which the United States imposes economic sanctions. At present, the EAA has expired and dual-use controls are maintained under IEEPA authorities.

The U.S. export control system is diffused among several different licensing and enforcement agencies. Exports of dual-use goods and technologies are licensed by the Department of Commerce, munitions are licensed by the Department of State, and restrictions on exports based on U.S. sanctions are administered by the U.S. Treasury. Enforcement of export controls is conducted by these agencies as well as by units of the Department of Homeland Security (DHS) and the Department of Justice (DOJ).

Revealing the Appetite of the Marine Aquarium Fish Trade: The Volume and Biodiversity of Fish Imported into the United States

May 24, 2012 Comments off

The aquarium trade and other wildlife consumers are at a crossroads forced by threats from global climate change and other anthropogenic stressors that have weakened coastal ecosystems. While the wildlife trade may put additional stress on coral reefs, it brings income into impoverished parts of the world and may stimulate interest in marine conservation. To better understand the influence of the trade, we must first be able to quantify coral reef fauna moving through it. Herein, we discuss the lack of a data system for monitoring the wildlife aquarium trade and analyze problems that arise when trying to monitor the trade using a system not specifically designed for this purpose. To do this, we examined an entire year of import records of marine tropical fish entering the United States in detail, and discuss the relationship between trade volume, biodiversity and introduction of non-native marine fishes. Our analyses showed that biodiversity levels are higher than previous estimates. Additionally, more than half of government importation forms have numerical or other reporting discrepancies resulting in the overestimation of trade volumes by 27%. While some commonly imported species have been introduced into the coastal waters of the USA (as expected), we also found that some uncommon species in the trade have also been introduced. This is the first study of aquarium trade imports to compare commercial invoices to government forms and provides a means to, routinely and in real time, examine the biodiversity of the trade in coral reef wildlife species.

New From the GAO

May 17, 2012 Comments off

New GAO Reports, Testimony and PresentationSource: Government Accountability Office

+ Reports

1. Antidumping and Countervailing Duties: Management Enhancements Needed to Improve Efforts to Detect and Deter Duty Evasion. GAO-12-551, May 17.
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2. 2020 Census: Additional Steps Are Needed to Build on Early Planning. GAO-12-626, May 17.
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3. Foreign Police Assistance: Defined Roles and Improved Information Sharing Could Enhance Interagency Collaboration. GAO-12-534, May 09.
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4. Grants Management: Action Needed to Improve the Timeliness of Grant Closeouts by Federal Agencies. GAO-12-360, April 16.
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+ Testimony

1. Temporary Assistance for Needy Families: State Maintenance of Effort Requirements and Trends, by Kay E. Brown, director, education, workforce, and income security, before the Subcommittee on Human Resources, House Committee on Ways and Means. GAO-12-713T, May 17.
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Presentation by the Comptroller General

1. Financial Managers: Aiding Accountability and Exercising Stewardship in Challenging Times, by Gene Dodaro, Comptroller General of the United States, before the Advancing Government Accountability-DC (AGA-DC) and the Greater Washington Society of CPAs (GWSCPA) Spring Educational Conference in Washington, DC. GAO-12-755CG, May 16.

CRS — U.S. Trade Remedy Laws and Nonmarket Economies: A Legal Overview

May 17, 2012 Comments off

U.S. Trade Remedy Laws and Nonmarket Economies: A Legal Overview (PDF)
Source: Congressional Research Service (via National Agricultural Law Library)

Two major U.S. trade remedies are antidumping (AD) law, which combats the sale of imported products at less than their fair market value, and countervailing duty (CVD) law, which aims to offset foreign government subsidization of imported goods. If dumped or subsidized imports are found to cause or threaten material injury to a domestic industry, antidumping or countervailing duties will be imposed. Both remedies are available when goods are imported from competitor countries with free market policies. As of 1984, however, only AD law had been applied to goods from nonmarket or “transitional” economies (NMEs). With the continued economic growth of some of these economies, such as China and Vietnam, pressure increased on the U.S. government to use both trade remedies more aggressively against unfair imports from these countries.

AD law has been amended several times since its inception in 1921. With Congress’s continued statutory guidance, the Department of Commerce (DOC) has implemented several different methodologies for applying AD law, including using surrogate country data when the fair market value of a product in the originating country is not readily ascertainable. CVD law had not been used against NMEs, however, since DOC concluded in 1984 that it could not determine subsidization in such situations. In 1986, the U.S. Court of Appeals for the Federal Circuit (CAFC), in Georgetown Steel Corp. v. United States, upheld DOC’s interpretation of the CVD statute as reasonable. While DOC had generally refused to review CVD petitions against NME countries following this determination, it accepted a petition seeking a CVD on imports of coated free-sheet paper from China in 2006. DOC distinguished the current Chinese economy from the Soviet-style economies at issue in Georgetown Steel and found that the imported Chinese paper was subsidized. Because the U.S. International Trade Commission did not make the requisite final affirmative material injury determination, CVDs were not imposed. Other CVD petitions were successful, however, resulting in the imposition of 24 CVD orders on NME country merchandise.

World Trade Organization (WTO) agreements, together with the WTO Accession Protocols of China and Vietnam, acknowledge that AD and CV duties may be imposed on these countries’ goods, and that surrogate country data may be used to calculate dumping margins or subsidization. In a WTO case brought by China, however, the WTO Appellate Body found in April 2011 that the simultaneous imposition by the United States of AD and CV duties on the same Chinese merchandise, where surrogate country data was used to establish the fair market value of the goods in the AD case, remedied the same subsidization twice or “double counted” in violation of U.S. WTO obligations. The United States is expected to comply with this decision by April 25, 2012. More broadly, the U.S. Court of Appeals for the Federal Circuit, on December 19, 2011, held that CVDs may not be imposed on NME goods under any circumstance, finding in GPX Intl Tire Corp. v. United States that Congress had legislatively ratified DOC’s 1984 statutory interpretation and thus DOC may no longer interpret the statute to permit such duties and must seek a statutory amendment if it wishes to impose such duties in the future. The CAFC affirmed a lower court decision that also prohibited DOC from imposing CVDs on NME goods, but did so on the ground that DOC had failed to eliminate double counting, the same practice at issue in the WTO case. DOC is preparing a new WTO-compliant determination in the investigations challenged by China in the WTO. The executive branch has also asked Congress to enact legislation to remedy the court’s ruling and, on March 5, 2012, requested that the CAFC rehear the case en banc. H.R. 4105 (Camp), passed by the House March 6 and the Senate March 7, 2012, and presented to the President for signature March 8, 2012, would generally authorize the application of CVDs to NME products, make this authority effective as of November 20, 2006, and prospectively amend antidumping law to address double counting issues.


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