Mr. Chairman, Ranking Member Wyden, and Members of the Committee: It’s a pleasure to appear before you today to testify on the President’s Trade Agenda and the newly-renegotiated United States-Mexico-Canada Agreement.
I would like to begin by noting that the United States’ economy has added 5.8 million jobs since the 2016 election. Notably, nearly 500,000 have been manufacturing jobs. The real GDP rose at annual rate of 3.1 percent in the first quarter of 2019. The past four quarters have seen the fastest growth rate in GDP since 2015. The unemployment rate at 3.6 percent is the lowest rate in nearly a half century and has been at or below 4 percent for 15 consecutive months. Wages are up; hourly wages were up some 3.1 percent over the last 12 months.
I commend this report right here to the Committee – it’s the Trade Policy Agenda and the 2018 Annual Report to the Committee – it’s one of the subjects of this hearing. The document which USTR put out recently outlines the Administration’s trade priorities and catalogues recent accomplishments.
As most of you know, the President is troubled by huge and persistent trade deficits, which the United States has with many countries. These deficits are the result of many factors – faster economic growth, currency valuations, and to some extent, tax policy, but they are also partially the result of trade rules that often times are unfair and lock in non-economic advantages for our trading partners.
We at USTR are very much focused on changing these rules where they are unfair to American farmers, ranchers, workers, and businesses. This has included renegotiating KORUS, which you are aware, and NAFTA, which you have just discussed and will discuss further. We also have been reviewing GSP eligibility; actively engaging in TIFA talks with many, many countries – we can talk about that; and reviewing the rules and functions of the WTO. USTR has also been active in enforcing the existing obligations of our trading partners. We’ve brought many WTO cases. We’ve filed counter notifications at the WTO and worked with other WTO members on a proposal to improve compliance with the existing WTO notification obligations.
We are also engaged directly with trading partners under existing agreements. For example, we have successfully resolved concerns with Peru after requesting the first-ever environmental consultations in the U.S.-Peru trade promotion agreement. In addition, we have used Section 301 to investigate unfair trade practices in China. We believe our economic relationship with China has been unbalanced and grossly unfair to American workers, farmers, ranchers, and businesses for decades. As many Members know, after an exhaustive process, we put tariffs on certain Chinese products and are preparing to do more if certain issues cannot be resolved satisfactorily.
Finally, I am pleased to be able to testify here today on the newly-renegotiated USMCA. We have worked very closely with Members throughout this process, and many of the improvements in this Agreement reflect Republican and Democratic Members’ ideas and thoughts. In short, I believe the USMCA is the strongest, most momentous trade agreement in U.S. history. It is the gold standard for rules on the digital economy, financial services, intellectual property, etc. It will help stop the outflow of manufacturing jobs and return many to the United States. Its labor and environmental provisions are the most far-reaching ever in a trade agreement. The agricultural chapter will lead to increased market access and eliminate unfair trading practices by our trading partners.
This is a truly great agreement, and I look forward to working with Members to make it even better and to write implementing legislation which will earn large, bipartisan support – and that’s my objective, I’ve said it from the beginning, my objective was to get a very large number of Democrats and Republicans to support this.
With that, Mr. Chairman, I will stop. Thank you again for the courtesy you and the other Members have shown towards me during this two-plus years as USTR, and I look forward to your questions.