Obama Trade Agenda Calls For Change

The office of the US Trade Representative (USTR) has sent its annual report to Congress. The report
includes an overview of President Barack Obama’s trade agenda calling for some significant changes
from President George W. Bush’s extensive free trade initiatives.

While the report is long on generalities and short on specifics, it does signal a different
approach to international  trade that places more emphasis on efforts to improve the standard
of living for American families and workers  both here and abroad, and to safeguard the

The report says “pressing economic conditions require the discipline to respond to immediate
problems while staying true to our long-term goals.” The president’s approach will be to promote
adherence to the rules-based international trading system at the World Trade Organization (WTO) in
order to promote economic stability, while at the same time introducing new concepts – including
increasing transparency and “promoting broader participation in the debate to help revitalize
economic growth and promote higher living standards at home and abroad.”

The president says he will seek an extension of the expiring Trade Promotion Authority, also
known as “fast track,” but he plans to work with Congress to develop authority with proper
restraints that will make it clear to the American people and Congress just how he plans to use the
authority. He plans to develop benchmarks to measure the effectiveness of future trade agreements.

The report says the administration is in the process of developing a plan of action
addressing pending agreements in consultation with Congress. That is a reference to the Colombian,
Panama and South Korean free trade agreements, negotiated by the Bush administration, that have run
into considerable resistance in Congress.

The Obama administration says it will “promptly but responsibly” address issues surrounding
those three agreements and also will work with Canada and Mexico to identify ways the North America
Free Trade Agreement can be improved without having an adverse effect on trade. The administration
says if new negotiating authority is needed, it will seek that from Congress.

The administration believes issues regarding trade with China need to be addressed. Noting
that China no longer is a new member of the WTO, the report says the United States and other WTO
members hold China “fully accountable as a mature member.” It says that despite some recent
progress, several issues continue to cause particular concern. These include such issues as
international property rights protections and industrial policies designed to give China an unfair
advantage in international trade. The Obama administration plans to continue concerted efforts to
ensure China fully implements its accession agreements and adheres to fundamental obligations.

While promising that the United States will continue “robust meetings and dialogues,” the
report says the United States will not hesitate to invoke the WTO’s dispute settlement mechanism,
and when US interests are being harmed by unfairly traded imports from China, the United States
will enforce its trade remedy laws.

In addition, the report makes the observation that under China’s accession to the WTO, any
WTO member can take action to prevent market disruption or threatened market disruption by Chinese
imports until 2013.

With respect to the WTO, the Obama administration remains committed to  and will take a
leadership role in working toward a successful Doha Round of trade liberalization negotiations that
will result in new market openings and an increased flow of global trade. In order for this to
happen, the report says, it will be necessary to correct imbalances in the current negotiations,
and it emphasizes that increased trade must not be at the expense of workers.

In order to soften the blow to import-impacted workers and companies here at home, the
administration plans to promote greater use of Trade Adjustment Assistance programs that, among
other things, provide opportunities for retaining of import-displaced workers.

The entire text of the report is available on the USTR’s website:

March 10, 2009