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EU, UK Remain Far Apart On Post-Brexit Trade Pact

Negotiations between the European Union and the United Kingdom to address unresolved issues concerning a post-Brexit free trade agreement have thus far yielded little progress.

The EU hopes to arrive at an agreement by October in order to secure approval from the European Parliament before the post-Brexit transition deadline on December 31, 2020. If a deal is not reached by year’s end, the World Trade Organization’s terms would come into force, meaning that most of the UK’s goods would be subject to tariffs until a free trade agreement was reached.

Two of the biggest obstacles are fishing rights and state aid. The UK wants access to EU fishing waters, while the EU wants the UK to abide by a level playing field for workers’ rights, environmental protection, taxation and state aid.

Although negotiations in August resulted in little progress, both sides expressed commitment to finding common ground during September’s negotiations.  However, the chances of reaching a deal more recently hit another hurdle when a bill was recently proposed in the UK Parliament which, as described by BBC.com, would give “Boris Johnson’s government the power to override parts of the Brexit agreement with the EU.”  The EU has responded, stating that it will not reach any future deal with the UK if “the U.K. authorities breach – or threaten to breach – the [Brexit] Withdrawal Agreement.”

Source: BBC.com; BBC.com; Politico.eu

US Considering Tighter Controls On Technology Exports

The Commerce Department’s Bureau of Industry and Security (BIS) is accepting comments through October 26, 2020 on a proposed rule that would tighten export restrictions on certain technology, including semiconductor manufacturing equipment and associated software tools, lasers and sensors.

According to a Federal Register notice, the BIS and its interagency partners “are engaged in a process to identify emerging and foundational technologies that are essential to the national security of the United States.”

The Trump administration noted that emerging technologies could be used for military applications by countries such as China, Russia or Venezuela.

Source: FederalRegister.gov; Reuters.com

US Trade Deficit Jumps 18.9 Percent in July

A surge in imports pushed the U.S. trade deficit up 18.9 percent in July, widening the trade gap to $63.6 billion compared to $53.5 billion from the previous month.

Imports expanded by 10.9 percent, while exports grew 8.1 percent.

On a positive note, the figures show increased consumer demand domestically and stronger demand for American-made goods globally.

However, global trade overall remains weakened due to the pandemic.

Source: MarketWatch.com

US, Mexico To Hold Trade Talks Over Fruits, Vegetables

The U.S. and Mexico plan to hold discussions in the next 90 days over concerns that Mexico’s exports of fruits and vegetables are harming American farmers.

Strawberries, bell peppers and other seasonal perishable goods are among those that U.S. Trade Representative Robert Lighthizer said are under review, and could be subject to tariffs.

For its part, Mexico said it would “defend the preferential access of Mexican agricultural exports to the United States.”

Source: VOANews.com

CBP Provides Certification Of Origin Template

U.S. Customs and Border Protection (CBP) has provided a Certification of Origin template that can be downloaded in a PDF format then filled out using Adobe Acrobat Reader.

According to CBP: “Most free trade agreements can be supported by a certification attesting to the imported product’s originating status. This attestation is called a Certification of Origin. The PDF… is a fillable template that demonstrates how such a Certification of Origin can be structured, and which users may elect to use. Its use, or adherence to its structure, however, is in no way compulsory. Nevertheless, pursuant to the relevant regulations, all of the data elements specified therein must still be provided upon request to CBP in connection with a claim for preferential tariff treatment.”  CBP also provided the following:  “This document may qualify as a ‘guidance document’ as set forth in Executive Order 13891 and interpretations thereof; such guidance documents are not binding and lack the force and effect of law, except as authorized by law or as incorporated into a contract. This document is being posted to this portal to provide stakeholders with useful information.”

Access the Certification of Origin template here.

Source: CBP.gov

Mexico’s New Labeling Rules For Junk Food Are Opposed By US, Others

Mexico is set to implement new labeling rules on October 1, 2020, for junk food that is high in sugars, calories, salt, and saturated or trans fat.

The country is the biggest consumer of processed food in Latin America and the fourth largest in the world.

However, obesity and diabetes rates are high in Mexico and reached epidemic proportions after the country joined the North American Free Trade Agreement in the early 1990s.

The U.S., European Union, Switzerland and Canada are opposed to Mexico’s new labeling rules.

Following a World Trade Organization meeting in May, the U.S. delegation said the labeling rules were “more restrictive than necessary to meet Mexico’s legitimate health objectives,” and the U.S. is asking for a two-year delay in implementing the labeling rules.

Nonetheless, a Mexican government official indicated that there would be no postponing the implementation date.

Source: Reuters.com

US-China Trade War Renews Interest In Mexico’s Manufacturing Capabilities

The ongoing trade war between the U.S. and China is prompting a reconfiguration of global supply chains, and Mexico’s proximity to the U.S., low labor costs and similar time zones is working to its advantage.

Two major Taiwan-based electronics manufacturers are among those considering sizeable investments in Mexico, whose foreign investment flows this year, have remained fairly steady despite the pandemic.

A senior executive with real estate brokerage firm Newmark Knight Frank said electronics, medical, and automotive firms in Asia are expected to drive investments into Mexico during the fourth quarter of 2020.

Source: Reuters.com

WTO Rules In Favor With Canada Over Lumber Dispute With US

A World Trade Organization (WTO) dispute settlement panel ruled that U.S. countervailing duties on imports of softwood lumber from Canada were inappropriately applied, despite the Commerce Department’s arguments that prices on timber from government-owned lands were artificially low due to subsidies provided by certain provincial governments.

After the most recent U.S.-Canada softwood lumber agreement expired in 2015, President Trump imposed tariffs of up to 17.99% on Canadian softwood lumber to combat the alleged government subsidies.

“For more than three years, our industry has paid billions of dollars in countervailing duties that today’s decision confirmed should never have been paid in the first place,” said the BC Lumber Trade Council in a press release dated August 24, 2020.

Shortly after the ruling, the Office of the U.S. Trade Representative (USTR) rejected the panel’s decision, calling it a “flawed report” that “confirms what the United States has been saying for years: the WTO settlement system is being used to shield non-market practices and harm U.S. interests.”  USTR also stated that the U.S. is currently “evaluating options in response to the panel report.”

Source: WTO.org; USTR.gov; Reuters.com; BIV.com

Michigan Announces Autonomous Corridor Project

Michigan’s Governor Gretchen Whitmer announced a “first of its kind” project to develop a corridor for connected and autonomous vehicles that will stretch from Detroit to Ann Arbor.

Phase One of the project is expected to last approximately 24 months.

According to Cavnue, a subsidiary of Sidewalk Infrastructure Partners (SIP) that serves as the Master Developer of the project, the goal is to develop the “world’s most sophisticated roadway” which will feature innovations in physical, digital, coordination, and operational infrastructure used to support connected buses, autonomous trucks and other vehicles.

Source: IntelligentTransport.com

Taiwan Seeks Free Trade Pact With US

Taiwan’s president has expressed her desire to launch free trade agreement (FTA) discussions with the U.S., a move that is strongly opposed by China.

The Trump administration is open to exploring a bilateral pact, although Taiwan’s rules pertaining to meat importations is an issue.

“We still face longstanding trade barriers that restrict market access for U.S. beef and pork products, despite previous commitments by Taiwan to fix these problems. Resolving these issues will be critical to deepening our trade and investment relationship with Taiwan,” explained U.S. Trade Representative Robert Lighthizer.

Taiwanese President Tsai Ing-wen remarked that, “We want to work together to resolve these issues in a way that is safe for our consumers, and also consistent with established scientific standards.”

She added that, “Past months have shown us the importance of economic linkages and supply chain security for both Taiwan and the U.S. We must be clear-eyed on how we can move forward on an FTA. For too long, closer trade relations have been hindered by technicalities that account for just a small fraction of two-way trade.”

Source: Politico.com

Trade Shows/ Conferences

Trade Shows/Conferences Location Date
Supply Chain USA Virtual https://events.eft.com/3pl/ Oct 7 – 8
(Virtual) Distribution Logistics Solutions Summit www.dlssummit.com Oct 7 – 8
Transportation Marketing & Sales Association Logistics Marketing & Sales Virtual Conference https://events.tmsatoday.org/logistics-marketing-sales-conference Oct 21 – 22
(Virtual) International Foodservice Distributors Association’s Distribution Solutions Conference https://www.ifdaonline.org/events/distribution-solutions-conference Oct 27 – 29
Home Delivery World https://www.terrapinn.com/conference/home-delivery-world/index.stm Oct 27 – 30
Gartner Supply Chain Symposium | Xpo https://www.gartner.com/en/conferences/na/supply-chain-us Nov 3 – 5

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