HEARING ON THE PRESIDENT’S FISCAL YEAR 2019 BUDGET REQUEST AND TRADE AGENDA
Subcommittee on Commerce, Justice, Science, and Related Agencies
Thank you, Chairman Moran, Ranking Member Shaheen and Members of the Subcommittee.
It has been 14 months since I was confirmed as the United States Trade Representative. It has been a very busy year for our agency. I would like to take you through a few of the highlights.
We have been renegotiating the North American Free Trade Agreement at an unprecedented speed. This would be the first comprehensive renegotiation of a U.S. trade agreement. As part of this process, we have consulted extensively with Congress as required by TPA. Hopefully, we are in the finishing stages of achieving an agreement in principle that will benefit American workers, farmers, ranchers, and businesses.
We are finalizing revisions to the U.S. – Korea Free Trade Agreement. We arrived at an agreement with the Koreans to strengthen domestic truck manufacturing here in the United States, allow more U.S. vehicles to enter the Korean market without burdensome regulations, and fix a whole host of implementation issues related to agricultural, pharmaceutical products, and many other products.
We are actively engaging in efforts to commence new trade agreements, including the newly-announced EU initiative from yesterday. After the confirmation of my Deputies in mid-March of this year, I instructed Ambassadors Mahoney and Gerrish to consult with Congress and to work with their foreign counterparts to find future partners for future agreements. We are speaking with a number of countries in Southeast Asia and Sub-Saharan Africa, and I’ll be happy to talk about that further if you are interested.
We have taken action on two 201 investigations, one on solar products and the other on washing machines. These are the first 201 investigations since 2001. Both cases involved a tremendous amount of work reviewing facts. Each resulted in an affirmative ITC recommendation, with the President largely accepting the recommendations of the International Trade Commission. And we have seen success in domestic manufacturing as a result of those actions.
At the direction of the President, USTR has been leading the Section 301 efforts to combat unfair Chinese intellectual property practices. In March of this year, we published our report and identified several major problems, including forced technology transfer, non-economic licensing practices, state-funded strategic acquisition of U.S. technology, and cybertheft. In response to the Chinese actions, the President directed the implementation of several measures, including a WTO case which we brought, targeted tariffs, strengthened export controls, and rigorously addressing state-directed investment in critical technologies.
We are also pursuing and defending numerous actions at the World Trade Organization. We are actively litigating 10 offensive disputes, defending 21 disputes, and participating as a third party in another 20 cases.
In addition to these major initiatives, USTR runs a host of other programs and deals with many trade issues on a day-to-day basis. We operate the Generalized System of Preferences program and the African Growth and Opportunity Act program. We monitor our many trade agreements we have in place. We prepare and publish numerous reports on trade. We lead the interagency process for developing trade policy. And we work on a daily basis with our foreign counterparts to reduce barriers to U.S. trade around the world.
Finally, I would like to touch on the budget of USTR. In FY 2017, we were appropriated $62 million with an option of deriving funds from a trust fund that was set up in 2015. Our appropriation for FY 2018 was $57.6 million plus $15 million from the Trade Enforcement Trust Fund. We are certainly grateful for the added appropriation, and we are focused on making the best use possible of it. For the fiscal year 2019 President’s Budget, USTR requested $63 million to support staffing increases and focus on priority areas.
I thank the Members of the Subcommittee for their time today, and look forward to answering your questions and discussing the President’s trade agenda.