By Meredith Gilston, Editor of Washington Tariff & Trade Letter
When it comes to companies’ responses to the global pandemic, where you stand depends on where you sit. Importers want removal or suspension of tariffs, while exporters want more flexible regulations and financing, and of course, the domestic industry wants increased stimulus and protection. U.S. agencies have announced a variety of temporary changes to its programs and regulations to reflect this diversity of experience.
From the beginning of the crisis, the World Trade Organization (WTO) tracked countries’ trade policies and their effect on world trade. “Rapid government responses helped temper the contraction, and WTO economists now believe that while trade volumes will register a steep decline in 2020, they are unlikely to reach the worst-case scenario projected in April,” the WTO said. “Looking ahead to 2021, adverse developments, including a second wave of COVID‑19 outbreaks, weaker than expected economic growth, or widespread recourse to trade restrictions, could see trade expansion fall short of earlier projections,” the trade body added.
Many industry representatives are using the health crisis to push for expanded trade access. In June, for example, more than 220 U.S. companies and associations urged congressional leadership to renew the Generalized System of Preferences (GSP), which expires at the end of 2020, as soon as possible. “Many U.S. companies are experiencing severe harm from the COVID-19 pandemic and the related economic downturn and are struggling to overcome these challenges, recover losses, and start growing again. Further uncertainty about whether companies will have to pay millions of dollars a day in new taxes in
January 2021 is the last thing the American business community needs,” they wrote.
The U.S. Export-Import Bank (Ex-Im) board in May extended previously announced coronavirus relief measures, including waivers, deadline extensions, streamlined processing, and flexibility, through
the summer. The extension came in parallel with the Ex-Im board votes to amend the agency’s economic impact procedures and strengthen the agency’s determination of “additionality.”
Members of the defense industry urged State’s Directorate of Defense Trade Controls (DDTC) to extend or even make permanent the temporary and retroactive changes to its compliance and licensing
procedures it announced in April. Companies specifically cited the extension of export licenses and remote workplace requirements. DDTC requested comments on the efficacy and termination dates of current suspensions, modifications and exceptions and whether additional measures should be considered.
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