Workers and labor standards around the world are a central element of the Biden administration’s trade policy.
The 2022 Trade Policy Agenda and 2021 Annual Report of the President of the United States on the Trade Agreements Program was submitted to the U.S. Congress on March 1.
The Biden administration recognizes that trade can –– and should –– be a force for good. Done right, and in coordination with other policy disciplines, it can grow the middle class, redress inequality, and level the playing field by promoting fair competition.
The administration remains committed to upholding a fair and open global trading system — one that follows through on U.S. trading partners’ longstanding commitment to conduct economic relations with a view to raising standards of living, ensuring full employment, and promoting sustainable development.
The Biden administration’s worker-centered trade policy reflects a commitment to use trade agreements, tools, and relationships to empower workers. The administration is working with trading partners to support workers’ rights and stop what it describes as “the global race to the bottom,” as well as seeking to establish new, high-standard commitments on labor rights under current and new frameworks for trade; and strengthening labor rights benefiting American workers, as well as workers all over the world.
The 312-page report further outlines the administration’s goals, summarized below.
Re-Aligning U.S.-China Relations
The Biden administration is taking a new, holistic, and pragmatic approach to the U.S.-China relationship, grounded in the principles of the administration’s worker-centered trade policy. This includes the domestic investments enacted through the President’s Build Back Better agenda, building supply chain resilience and using all tools, new and old, to combat the harms of China’s state-led non-market practices.
There will be a renewed focus on engaging with partners and allies who also suffer from China’s unfair trade and economic practices. The Biden administration also will continue to hold China accountable for its use of state-sponsored forced labor, which was recently updated in the Xinjiang Supply Chain business advisory.
Engaging with Key Partners
It is the goal of the Biden administration to use the shared goals of growing the middle class, redressing inequality, and incentivizing climate and environmental action, to increase engagement with partners, allies, and multilateral institutions and organizations to achieve a more resilient and just global economy.
The key areas the Biden administration identifies are listed in order below:
• The Indo-Pacific Economic Framework is a central piece of the goal to deepen economic relationships with allies and partners, while also complementing the administration’s national security goals in the region. The U.S. Trade Representative (USTR) will lead efforts to craft a trade arrangement with parties that includes provisions on: high-standard labor commitments; environmental sustainability; cooperation in the digital economy; sustainable food systems and science-based agricultural regulation; transparency and good regulatory practices; competition policy; and trade facilitation.
• The Biden administration supports a reform agenda for the World Trade Organization that protects the planet, improves labor standards, and contributes to shared prosperity. The administration supports restoring efficacy to the negotiating arm and promoting transparency, improving compliance with and enforcement of members’ WTO commitments, and equipping the organization to effectively address the unfair practices of non-market economics and global market distortions.
• The Organisation for Economic Cooperation and Development was the subject of the Biden administration’s concern in 2021 as an agreement on digital services taxes and global income tax was reached. The United States and trading partners around the globe have since agreed to roll back existing digital services taxes (DSTs) and other similar measures, as the global tax reform is implemented, and not to adopt any new DSTs. The USTR will continue to monitor and explore all options if other countries move forward with new DSTs during the implementation period.
• Bilateral Initiatives is the administration’s last tool to use to rebuild relationships with trading partners and advance a worker-centered trade policy.
– In the European Union the administration is focused on reducing trade irritants and continuing the cooperative work of the Trade and Technology Council which began in 2021.
– In India in 2022, USTR will look to the Trade Policy Forum to tackle issues including the relationship between trade, labor and the environment.
– The first series of meetings for the U.S.-Japan Partnership on Trade are scheduled for early 2022, after a new Section 232 tariff agreement was announced. The initial areas of focus for cooperation include issues such as third country concerns, cooperation in regional and multilateral trade-related fora, addressing labor and environment-related priorities, a supportive digital ecosystem for all, and trade facilitation, among others.
– The Biden administration will hold further conversations with the Kenya government to establish a shared vision and partnership for economic resilience and to promote investment, equitable and inclusive development, sustainable trade, and African Continental Free Trade Area (AfCFTA) implementation.
– The U.S. will continue to engage with the AfCFTA.
– In 2022, USTR will hold several events in the United Kingdom to hear directly from stakeholders on the way forward for U.S.-UK trade ties.
– The U.S. and Korea agreed to hold meetings of the KORUS Labor Affairs Council and Environmental Affairs Council in 2022, after the KORUS Joint Committee met last year. The U.S. is committed to working with Korea to address our shared concerns, such as supply chain challenges, sustainable trade, emerging technologies, the digital economy, and trade facilitation.
– The U.S. and Taiwan have agreed to form a Labor Working Group under the Trade and Investment Framework Agreement (TIFA). The U.S. will also work with Taiwan to address outstanding trade concerns, including market access barriers facing U.S. beef and pork producers, and concerns involving copyright legislation, digital piracy, financial services, investment, and regulatory transparency.
– In 2022, the U.S. will continue working with Singapore to address issues on the environment, labor, digital trade, supply chains, and intellectual property, among others.
Promoting Confidence in Trade Policy Through Enforcement
The Biden administration is using all the tools at its disposal to combat unfair economic practices and shape a global trading system that enforces labor and environmental standards, protects intellectual property rights, and ensures that regulations are science-based and predictable.
Originally crafted decades ago, current trade tools are inadequate to address challenges from the modern economy. In 2022, the administration will work with Congress to fully evaluate existing trade tools, identifying ways to strengthen them, and creating new tools as necessary.
The administration has already taken action to utilize trade policy as a tool to defend U.S. economic interests in the U.S.-Mexico-Canada Agreement (USMCA). The Notorious Markets List (see related story) examined widespread labor abuses and the adverse impact of counterfeiting on workers involved with the manufacture of counterfeit goods.
In addition, the administration will continue to administer its preference programs in line with its worker-centered agenda and in accordance to the statutory, eligibility criteria; which resulted in the termination of several countries from the African Growth and Opportunity Act (AGOA) trade preference program.
The administration also has identified currency manipulators, which included the continued monitoring of Vietnam’s currency policies and practices.
Promoting Equitable, Inclusive, Durable Trade Policy and Expanding Stakeholder Engagement
In strengthening the nation’s competitiveness and expanding the benefits of trade, racial and gender equity must be core elements of U.S. trade and investment policy, according to the Biden administration. The administration states that an intersectional, interconnected framework is particularly important in emerging sectors where the United States has the potential to be competitive and create well-paying U.S.-based jobs through trade.
In addition, all U.S. trade policy tools, engagements, and initiatives will consider and reflect the core principles outlined in the executive orders on racial and gender equity, worker empowerment, and advancing LGBTQI+ rights, among others.
The Biden administration also outlines its commitment to engaging with a wide variety of diverse and underserved communities as trade policy is developed and implemented. The administration will continue to consult the 28 advisory committees that USTR manages to hear input from a variety of groups and organizations, state and local governments, industries, and academia.
In 2022, the Biden administration will continue to actively engage with Congress and work with members to address their and their constituents’ trade policy priorities.
Report on Trade Agreements
The report then goes onto give details on the annual report of the President on U.S. trade agreements with: Australia, Bahrain, Central America and the Dominican Republic, Chile, Colombia, Israel, Jordan, Korea, Mexico and Canada, Morocco, Oman, Panama, Singapore, and concludes with details on trade enforcement actions.
CalChamber Position
The California Chamber of Commerce, in keeping with longstanding policy, supports expansion of international trade and investment, fair and equitable market access for California products abroad, and elimination of disincentives that impede the international competitiveness of California business.
Specifically, the CalChamber asks that:
• Trade be a priority.
• The revamp of the WTO address the functioning of the Appellate Body, and support efforts to ensure our trading partners adhere to fair and transparent trade practices while being held accountable when they violate international rules.
• The focus continue on lowering tariffs and nontariff barriers to support the expansion of American exports.
•Trade Promotion Authority is renewed to enable the United States to easily pursue new trade deals.
• Bilateral, regional, and multilateral trade agreements — which are critical to consumers, workers, businesses, farmers and ranchers — continue to be advanced.
