U.S. and Mexico Reach Agreement on Sugar Dispute

June 5, 2017  |  No Comments  |  by Nicole àBeckett  |  Blog

U.S. and Mexico have reached an agreement in the dispute over sugar trade today, according to sources (Reuters). The agreement will prevent a trade war in which the U.S. would have imposed steep tariffs on Mexican sugar imports and Mexico would have responded with equal tariffs on U.S. high-fructose corn syrup.

Details of the agreement are not yet public, but sources indicate the deal was made to benefit both countries. According to the Juan Cortina Gallardo, the president of Mexico’s sugar chamber, the managing of the sugar agreement will set a precedent for how further negotiations will play out (The New York Times). Since NAFTA was first negotiated in the early 1990s, the sugar industry has been the most contentious issue in U.S.-Mexico trade relations.

The current agreement will modify a 2014 agreement in which quotas and a price floor on Mexican sugar acted as an alternative solution to antidumping and antisubsidy duties. U.S. sugar companies had argued that the agreement was not doing enough to counter “unfairly subsidized” Mexican sugar companies, who could sell sugar in the U.S. at a price domestic companies could not compete with.

Stay up to date with the details of the agreement and other international trade news by following Mercatura Global on Twitter.

Will New Tariffs on Canadian Softwood Lumber Cause U.S.-Canada Trade War?

April 26, 2017  |  No Comments  |  by Nicole àBeckett  |  Blog

On Monday, U.S. President Donald Trump announced an increase in tariffs from 3% to 24% on softwood lumber imports from Canada. Most lumber companies in Canada are state-owned and subsidized by the Canadian government, and the U.S.-Canada dispute over softwood lumber is decades old (The New York Times). American mills recently filed a complaint, and the U.S. Commerce department responded by imposing a tariff equivalent to the subsidy amount (24%) on five Canadian companies. For all other Canadian lumber companies, the tariff rate was set at 20%.

According to the Wall Street Journal, Commerce Secretary Wilbur Ross claimed it had been a “bad week for U.S.-Canada trade relations.” This statement also reflects President Trump’s complaints about Canada’s system of protections on its dairy industry, leading to unfair treatment of American dairy farm workers.

Both softwood lumber and the dairy industry were left out of the initial North American Free Trade Agreement in 1994, so it is easy for the U.S. to bring up the issues without formal negotiations (Reuters).

In Canada, the country is considering some sort of aid package to the companies that will be hit by the tariff (Bloomberg). In Quebec, 60,000 people work in the forest-products industry, and the province is putting in place a program of loan and loan guarantees that is expected to be worth 300 million Canadian dollars.

In the past, disputes around the softwood lumber industry were always won be Canada. However, if it becomes a legal fight, it is likely that the process will take a few years to be settled. Stay up to date with current U.S.-Canada trade relations by following Mercatura Global on Twitter.

Amendments of Cuba Sanction Regulations to Ease Trade

October 25, 2016  |  No Comments  |  by Nicole àBeckett  |  Blog

The future of U.S. and Cuba trade relations is looking bright. New amendments to the Cuban Assets Control Regulations (CACR) and Export Administration Regulations (EAR) were made to create a more open U.S.-Cuba relationship. With the new amendments put into effect, the U.S. and Cuba hope to enable more scientific collaboration, people-to-people contact, and private sector growth between each other (Global Trade Magazine). To reach this goal, the OFAC has authorized numerous measures, including lifting some trade restrictions that limited what can be traded amongst the two countries and how it can be traded. Further, U.S. firms will have the ability to go to Cuba and improve Cuban infrastructure for humanitarian purposes.

These amendments are part of President Obama’s plan to make the opening of Cuba “irreversible” by the time he leaves office (Reuters).  President Obama has accomplished this by relaxing both trade and travel restrictions, and his recently issued Presidential Policy Directive on Cuba builds upon the changes already made. However, despite the progress made in the past two years, the U.S.’s trade embargo on Cuba remains in place and continues to be an obstacle for trade between the two countries.

Although the embargo is not completely gone, the relaxed sanctions make trade with Cuba much more accessible than it was in the past. Through six rounds of regulatory changes made by the U.S. Treasury and Commerce Departments, travel to Cuba and trade with Cuba are now possible. The U.S. is now looking to Cuba for future growth and export opportunities, and notable progress has already been made.

10th U.S.-India Trade Policy Forum Occurring Today in New Delhi

October 20, 2016  |  No Comments  |  by Nicole àBeckett  |  Blog

India’s Commerce and Industry Minister Nirmala Sitharaman and U.S. Trade Representative Michael Froman will meet today during the 10th trade policy forum (TPF). As the premier bilateral forum for discussion between India and the US, important topics of discussion include agriculture, investment, innovation and creativity, services, and tariff/non-tariff barriers (The Business Standard). Current bilateral trade between the two countries is around $100 billion, yet both sides have expressed the goal of raising that number to around $500 billion in coming years.

The purpose of the forum is to understand the best practices for bilateral trade, facilitate increased investment, and raise any concerns either side might happen. Froman claims that trade with India is “a work in progress,” and he believes the upcoming TPF will smooth over some of the restrictive issues to better the business environment and improve their trade relationship (The Economic Times). Intellectual property rights issues are of particular importance.

Past TPFs have resulted in the resolutions of multiple issues regarding services, manufacturing, and IPR. From 2015-2016, there was an overall increase in bilateral trade of goods and services and the highest ever level of foreign direct investment inflow. The TPF taking place today hopes to continue this trend, and the there is no better time to begin considering your export opportunities to India..  If you are interested in learning more about how to start this process, contact Mercatura Global today.

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