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Issue 9 2019 - FBJNA From the Editor


CONTACTS 2019 SALES


MATT WEIDNER Tel: + 1 610 486 6525 matt.weidner@fj-online.com


JOHN SAUNDERS - PUBLISHER Tel: +44 (0)151 427 6800 Mobile: +44 (0)7932 102026 john.saunders@fj-online.com


EDITORIAL


KAREN THUERMER -EDITOR karen.thuermer@fbj-online.com CONTRIBUTING EDITORS: PETER BUXBAUM MARK CALDWELL HANK DONNELLY JOHN JETER AMANDA LOUDIN


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LORRAINE CHRISTIAN Tel: +44 (0)151 427 6800 lorraine.christian@fj-online.com


ANDREA CAZZOLATO Tel: +44 (0)151 427 6800 andrea.cazzolato@fj-online.com


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By Karen E. Thuermer


There’s a lot of political divisiveness in the United States right now. Besides impeachment hearings, which pit Trump thumpers against never-Trumpers and test the very core of the US Constitution, it’s clear that we should never be lax about our laws, our values, and our ability to negotiate in good faith. As of this writing, key trade issues appear to be in turmoil. And for too long,


the business community has been holding its breath for Congressional passage of the long-awaited US-Mexico-Canada Agreement (USMCA). I’m writing this editorial on November 21. Right now, U.S. Trade Representative


Robert Lighthizer is meeting with House Speaker Nancy Pelosi and Ways and Means Chairman Richard Neal (D-MA) to discuss USMCA. By the time FBJNA goes to press, FBJNA readers will know if Congress (the Democrats) passed USMCA, making it a bona fide tri-lateral agreement. Today happens to be the last day the House is session before Thanksgiving.


And as of today, there’s only 15 legislative days left in 2019. If the deal was not signed, USMCA has slipped in limbo land and has become part of next year’s election rancor. At stake to Democrats is language regarding labor, most specifically that


which ensures improvement to wages and working conditions, especially in Mexico. With the Democrats controlling the House, their support is essential to USMCA’s passage. But that’s not the only issue in turmoil. There’s the on-again, off-again Phase


One trade agreement between the US and China. Today its off again. Rumor has it the deal will not be completed until next year given the cat-and-mouse game between Beijing and Washington. Beijing is pressing for greater reductions in tariffs. Washington is pushing back with increased demands. With the agreement off again a week before Thanksgiving, Trump, in his


usual fashion, stated he’s “fine” with not reaching a trade deal with China. He’s fine with collecting tariffs on Chinese goods that symbolize trade abuses with the United States. He made the comment just hours before receiving a bill that supports


human rights in Hong Kong passed overwhelmingly by both the Democratic- controlled House and Republican-controlled Senate. The Washington Post commented: “The Hong Kong bill brought rare bipartisan cooperation even as the impeachment inquiry deeply divided lawmakers.” Known as the Hong Kong Human Rights and Democracy Act, the bill


mandates sanctions on Chinese and Hong Kong officials who carry out human rights abuses. It includes language that prohibits exporting lethal equipment to Hong Kong. It also requires an annual review of the favorable trade status that Washington grants Hong Kong. So far, the White House has not commented on the bill and Trump is mute


about supporting the pro-democracy protesters in Hong Kong, which has raised eyebrows even among some Republican lawmakers. As House Speaker Pelosi said, “If the U.S. doesn’t speak up for human rights in China because of commercial issues, we lose all moral authority to speak about human rights anywhere in the world.” The bill was immediately condemned by Chinese officials who threatened


“strong countermeasures.” But Chinese officials also hinted that they are “cautiously optimistic” about


reaching a trade agreement with the United States. The expectation is that communications channels regarding a deal will remain open as it appears Beijing has also asked top U.S. trade negotiators for a new round of face-to-face talks. Let’s hope for the best. But given these enormously important issues, it’s important to look at other


Are we a nation of laws or hot air?


///NEWS


Freight Business Journal North America - FBJNA reaches out to the decision makers and influencers involved in international freight transport and logistics. FBJNA boasts the most informative and authoritative source of information with unrivalled in depth knowledge of the rapidly changing freight business environment. Our complimentary website www.fbjna. com provides the most up to date news and analysis from within the international shipping industry.


If you have any stories or letters which should be of interest or any feedback on FBJNA, please contact our editor Karen Thuermer - karen.thuermer@fbj-online.com


next issue >> Our next issue will include features on: Outlook 2020


- commodity groups, Georgia Ports 75th Anniversary & Environmental Impact. For further details contact: Matt Weidner - T: + 1 610 486 6525 E: matt.weidner@fbj-online.com


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Total Circulation 12,275 circulation >>


trade abuses right in the United States. Case in point: The International Emergency Economic Powers Act (IEEPA). Signed in October 1977, this US federal law authorizes the president to


regulate international commerce after declaring a national emergency in response to any unusual and extraordinary threat to the United States that “has its source in whole or substantial part outside the United States.” Rufus Yerxa, President of the National Foreign Trade Council (NFTC) and


former WTO Deputy Director General, highlighted the issue last May when he pointed to Trump’s decision to hit Mexico with a 5% tariff on all goods until Mexico stopped the flow of undocumented immigrants across the US- Mexican border. Yerxa said in a televised Bloomberg interview: “Never before has IEEPA been used this way. This is a law that has only been used against rogue states and terrorist behavior.” He added that Trump’s actions were “very scary.” Yerxa also questioned whether Trump’s action would be challenged


legally by the US Congress. “The law requires that he consult with Congress before taking such actions,” he said. To date, they have not. Shippers, manufacturers and transport companies should be concerned


about IEEPA abuses since their business depends on stability, particularly with those countries with whom they have a long and growing history. In fairness, Trump is not the only president to abuse IEEPA. Exploitation


of IEEPA has been on the rise for years. But Trump has a decisive history of using tariffs for a wide host of reasons, many of which that are not related to terrorist acts or rogue states. Holding strong to US and democratic values is critical for this nation’s


integrity. We must be genuine regarding our trade commitments and trade agreements less we be nothing but hot air.


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