Many wood products traders have been following the sometimes ridiculous machinations of the U.S. Congress over the last two years in search of the answer to a simple question: when will Washington see fit to return the money paid in extra duties during the lapse of the Generalized System of Preferences (GSP) program? Thankfully, with passage of the Trade Preferences Extension Act of 2015, we are finally starting to see U.S. Customs and Border Protection begin the refund process. As important as GSP renewal is to many traders, Congress in this legislative package also set the stage for further action on a number of trade agreements that could boost global trade and hopefully spur further economic growth here in the U.S. and around the world.
Alongside the Trade Preferences Extension Act of 2015, Congress also granted the President Trade Promotion Authority, or “Fast-track Authority.” This authority gives Congress the ability to approve or deny, without amendment, future trade agreements. Because negotiators would not put forward their last, best deal if any final agreement was subject to changes on the House or Senate floors, this authority has been seen as crucial to wrapping up negotiations on agreements that have been in development for years, including the Trans-Pacific Partnership (TPP), the Transatlantic Trade and Investment Partnership (TTIP), the WTO Environmental Goods Agreement (EGA), and the Trade in Services Agreement (TISA).
Of particular interest to many in the global wood products trade are TPP and EGA, each of which seeks to boost global trade in different ways. TPP would reduce barriers to trade between the U.S. and eleven nations that span the Asia-Pacific region, including Australia, Canada, Japan, Malaysia, Peru and Vietnam. While U.S. barriers to imports are generally low by global standards, the Obama administration is betting that closer economic ties across the Pacific will boost U.S. exports and secure America’s leadership in the region. The EGA, alternatively, is an attempt to reduce trade barriers for environmentally sustainable goods. As I shared in this space previously, it is IWPA’s view that sustainably sourced wood products represent “the ultimate green good,” and it is for this reason that we have urged the Office of the U.S. Trade Representative to argue that duties for such goods should be eliminated as part of these negotiations.
It is not surprising that countries around the world are looking for new ways to access American consumers. While China’s reported GDP has finally overtaken that of the U.S., the U.S. market remains the premier destination for high quality products from around the globe. It is encouraging that the Obama Administration, as well as bipartisan majorities in both the House of Representatives and the Senate agree, if seemingly only on this one issue, that increased global trade is in our shared interest.
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