China tariffs could ‘go on for years,’ USTR says

A United States-China trade war might last for years, U.S. Trade Representative Robert Lighthizer said July 26.

Testifying before the Senate Appropriations Subcommittee on Commerce, Justice, Science and Related Agencies, Lighthizer also said a U.S. agreement with Mexico rewriting the North American Free Trade Agreement could be concluded by the end of August.

However, many committee members focused on tariffs imposed by the Trump administration on China and the retaliation for those tariffs.

Sen. John Kennedy, R-LA, asked Lighthizer, “I know you can’t give me month and day, but is it going to take months or years?”

Lighthizer replied, “I think some issues will be dealt with shortly, and I think, directionally, we’re going to have a problem with China that’s going to go on for years,” Lighthizer said.

Kennedy broke off Lighthizer’s comments asking, “You think it’ll take years with China?”

“I believe that to be true,” Lighthizer said. “The way I analyze it, senator, they have a system and their system is challenging our system, in my opinion.”

In his opening remarks, subcommittee chairman Jerry Moran, R-KS, told Lighthizer that while cracking down on China’s unfair trade practices that the tariffs against China are good, the administration’s current strategy does not seem to be working.

“The tactics we see now—where the United States imposes tariffs, China responds, the United States threatens more tariffs, China responds and so forth—appear to have gotten China’s attention, but more tariffs cannot be the ultimate answer,” Moran said.

“Any further escalation of this dispute that results in more tariffs will only cause undue harm to U.S. families, farmers, manufacturers, workers, consumers and businesses—the very people and industries that USTR is supposed to help succeed.

The effects of the current tariffs are real, and farmers, ranchers and the manufacturing sector across the U.S. and in my home state of Kansas are feeling the pressure.”

Moran said it has been estimated that $361 million of Kansas exports are being threatened by various tariffs.

“Bottom line—trade and exports are how we earn a living in Kansas and farmers, ranchers and our nation’s manufacturing industry cannot afford a trade war,” Moran said.

Moran also complained about the renegotiation of NAFTA. He reminded Lighthizer of a letter sent May 18, 2017, shortly after Lighthizer’s confirmation and addressed to congressional leaders about USTR’s intent to renegotiate NAFTA.

“As you stated in that letter, NAFTA was ‘outdated and do[es] not reflect modern standards,’ and, notably, that USTR was ‘committed to concluding these negotiations with timely and substantive results,’” Moran said.

“More than a year later, this process is still underway. Ambassador Lighthizer, I do not think it would be a surprise to you that many were concerned about your efforts to renegotiate NAFTA, especially considering the administration’s nonchalant attitude toward terminating the agreement. Understandably, many are even more concerned about the administration’s direction today.”

In his testimony, Lighthizer said he believes it’s likely he will get Mexico to sign off on a deal in August.

“We have been renegotiating the North American Free Trade Agreement at an unprecedented speed. This would be the first comprehensive renegotiation of a U.S. trade agreement. As part of that process, we have consulted extensively with Congress as required by the (Trade Promotion Authority) legislation. Hopefully, we are in the finishing stages of achieving an agreement in principle that will benefit American workers, farmers, ranchers and businesses,” Lighthizer said.

“My hope is that we will before very long have a conclusion with respect to Mexico and as a result of that, Canada will come in and compromise.”

Larry Dreiling can be reached at 785-628-1117 or [email protected].