Conservative group rallies Ryan against Ex-Im rescue

With help from Megan Cassella, Doug Palmer and Victoria Guida

CONSERVATIVE GROUP RALLIES RYAN AGAINST EX-IM RESCUE: Koch-backed advocacy group Freedom Partners urged House Speaker Paul Ryan on Wednesday to block efforts to restore the Export-Import Bank to full power through the appropriations process.

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The export credit agency has been unable to approve transactions above $10 million since it was reopened in December because its board doesn’t have a quorum, thanks largely to Senate Banking Committee Chairman Richard Shelby’s refusal to consider nominee Mark McWatters. But now spending bills are now moving through the House and Senate that would change the agency’s quorum rules and lift financing restrictions on the bank.

“I am writing to thank you for your past opposition to the Export-Import Bank and to urge you to oppose recent efforts to change Export-Import Bank requirements for approving high-dollar financing deals,” Freedom Partners Chamber of Commerce Chairman Mark Holden said in a letter to the speaker.

He called the Ex-Im amendment “a blatant attempt to expand taxpayer-funded corporate welfare” that would “overwhelmingly benefit some of the largest and most politically connected companies in the world at the expense of America’s small businesses.” Click here to read the letter.

IT’S THURSDAY, AUG. 18! Welcome to Morning Trade, where we’re not surprised to find out that Silicon Valley is no longer where most technology patents are filed. Got any other useful international economic news we should know about? Let me know: or @abehsudi.

INDUSTRY HOPEFUL ON CHINA BIT PROGRESS: China is gradually improving its offer in bilateral investment treaty talks and is expected to submit a revised list of sectors it’s willing to open to U.S. investment just prior to the G-20 leaders summit in early September, a senior industry official said.

“My understanding is that [the Chinese have] put a lot of sectors on the table to be opened up that haven’t been there before, but more needs to be done,” John Frisbie, president of the U.S.-China Business Council, told reporters at a Wednesday briefing to discuss President Barack Obama’s upcoming trip. “I suspect that the Chinese side is going to offer another negative list sometime between now and when President Obama goes there.”

Obama travels to China for the Group of 20 leaders summit on Sept. 3-4. At a 2015 state visit in Washington, Chinese President Xi Jinping and Obama committed to stepping up talks on a bilateral investment treaty, and administration officials have talked openly of trying to finish the pact this year.

Frisbie said he believes it is important the two sides reach a deal before Obama leaves office, partly because of the time it would take a new administration to get up to speed on the talks. However, it will have to be a high-quality, ambitious agreement to get support from the business community and persuade two-thirds of the Senate to vote to approve it, he said.

WHITE HOUSE WOOS ASIAN-AMERICANS ON TPP: In another sign the Obama administration has not given up on the TPP, White House officials are reaching out today to members of the Asian-American and Pacific Islander community to try to sell them on the merits of the 12-nation pact.

National Security Council senior director for trade and investment Himamauli Das and senior director for Asian affairs Dan Kritenbrink are briefing members of the Asian American/Pacific Islander Chamber of Commerce and Entrepreneurship organization by phone late this afternoon, but the ultimate target appears to be the 17 executive board members of the Congressional Asian Pacific American Caucus, as well as the 33 associate members.

Last year, only one CAPAC executive board member — Ami Bera — voted to give Obama trade promotion authority to finish TPP, and two associate members — Susan Davis and Gerry Connolly — voted yes. Given the tough trade environment, it will be hard for the White House to persuade more CAPAC members to support TPP, one industry source said. Caucus Chairwoman Judy Chu voted against the South Korea, Colombia and Panama free-trade agreements in 2011, and other members have similar voting records.

USTR: PERU’S TIMBER INDUSTRY HAS A WAYS TO GO: Peru still has work to do to reform its forestry sector, a new report shows, after a U.S.-demanded investigation found significant portions of timber shipped to Houston earlier this year were illegally harvested and traded. A U.S. interagency committee is looking to hold a meeting between senior-level groups established under the U.S.-Peru free-trade agreement as soon as possible to discuss concrete steps forward to address the issue, the report said.

The U.S. trade representative’s office had asked in February for an investigation into the shipment, which came from Peruvian company La Oroza SRL, after reports indicated it may have contained illegally harvested products. Inspections revealed some trees were harvested without authorization, and investigators also found that delays by the regional government had hindered the supervising agency’s ability to carry out inspections before shipment.

The results of the report “highlighted both the progress and the challenges that remain in Peru’s forestry sector,” U.S. Trade Representative Michael Froman said in a statement. U.S. Sen. Ron Wyden, meanwhile, who had requested the report earlier this year, took a harsher stance.

“The report provided by Peru demonstrates that it has much more work to do to enforce its laws and to stop trade in illegally taken timber,” the Oregon Democrat said in a statement. “Illegal timber costs American jobs and damages ecologically critical rainforest. I strongly urge Peru’s new government to promptly act on the recommendations provided by the Obama administration today, and that U.S. agencies — particularly U.S. Fish and Wildlife — redouble their efforts to identify and interdict illegally taken timber.”

Peru should focus on improving the timing of its inspections, increasing transparency in its enforcement of forestry laws and implementing timely, effective sanctions against actors involved in illegal logging and trade, the committee suggested. It also identified the electronic tracking of timber and Peru’s new Forestry and Wildlife Law and Regulation as areas in need of further improvement, among others.

TOOMEY SAYS NO TO TPP, FOR NOW: Pennsylvania Sen. Pat Toomey made a play to reverse lagging poll numbers in a tight race for his contested seat in a key battleground state by rejecting the TPP “as it now stands.”

“We should dump the TPP and return to the negotiating table to get an agreement that would create jobs and economic growth here at home,” he wrote in a Wednesday op-ed in the Pittsburgh Post-Gazette.

Toomey said the deal falls short in “several areas,” including intellectual property protections for pharmaceuticals and inadequate new market opportunities for dairy products, the state’s largest agricultural product. Congressional Republican leadership has also said those issues need to be addressed before voting on the deal, most likely in the lame-duck session.

Democratic challenger Katie McGinty was quick to take Toomey to task over his position on the trade deal, highlighting his strong record of supporting trade measures during his tenure in the Senate. Toomey was a vocal supporter of last year’s trade promotion authority legislation. He also supported trade deals with Colombia, South Korea and Panama, as well as legislation to ease passage of those agreements in Congress.

“Pat Toomey has spent his entire career pushing bad trade deals and policies that ship Americans jobs overseas, so nobody is buying this ridiculous flip-flop,” said McGinty, a former head of Pennsylvania’s Department of Environmental Protection who also served as a top environmental adviser to President Bill Clinton.

U.S. STEEL MANUFACTURERS FINALIZE VICTORY: The steel wars continue as U.S. manufacturers scored another victory this week when the U.S. International Trade Commission made a final affirmative injury determination on imports of heavy-walled rectangular welded carbon steel pipes and tubes from South Korea, Mexico and Turkey.

The 4-2 vote provides one more victory to the U.S. steel industry, which has been waging a prolonged battle against plummeting steel prices caused by a glut in global steel markets.

The decision will finalize anti-dumping duties ranging from just over 2 percent for imports from South Korea’s Dong-A Steel Co. to more than 35 percent for imports from Turkey’s MMZ Onur Boru Profil Uretim Sanayi Ve Tic. A.S. Turkish exporters were also hit with a separate set of duties ranging from 15 percent to more than 23 percent to counter unfair subsidization. The Commerce Department announced its final margins last month.

In 2014, imports were worth $50.5 million, $53.7 million and $41.9 million from South Korea, Mexico and Turkey, respectively.

U.S. NOTCHES WIN IN PLASTIC NETTING CASE: The Commerce Department issued a preliminary determination on Wednesday to slap anti-dumping duties on imports from China of certain “biaxial integral geogrid” products — a plastic netting-like material used in construction products like paving roads. Commerce established preliminary dumping margins of 38.92 percent for mandatory respondent Taian Modern Plastic Co. and 66.74 percent for all other Chinese exporters. The exception is the other mandatory respondent, BOSTD Geosynthetics Qingdao Ltd., whose rate of dumping was found to be zero.

The Commerce Department, in announcing that the ruling would be coming, said on Monday imports of the product were valued at an estimated $1.6 billion in 2015. In Wednesday’s ruling, it said only that imports of the product were valued at an estimated $9.2 million in 2014.

BRADY, LEVIN TALK TOUGH ON INSURANCE NEGOTIATIONS: House Ways and Means Chairman Kevin Brady and ranking Democrat Sander Levin say they support negotiations to ease the operations of U.S. insurers in the European Union, but warned that trade enforcement action is warranted if that effort fails.

“If, however, it is not possible to quickly remove the less favorable treatment through the covered agreement negotiations, then we urge you to consider other ways to address this unjustifiable trade barrier, including the enforcement tools that we have available to us in our trade agreements,” the lawmakers wrote in a letter to Treasury Secretary Jack Lew and U.S. Trade Representative Michael Froman on Wednesday.

Brady and Levin question, in their letter, whether “discriminatory treatment” in the EU violates World Trade Organization rules on national treatment under the General Agreement on Trade in Services.

The European Union requires non-EU firms to be recognized as “equivalent” under its recently enacted insurance regulations. The two sides launched negotiations last year to enter into an agreement that could lead to an equivalence finding for U.S. companies, which would allow firms to operate in the EU market. An agreement could also address EU complaints over U.S. state regulatory requirements that foreign reinsurance companies hold 100 percent of their collateral inside the U.S.

USTR STAFF WATCH: U.S. Trade Representative spokesman Trevor Kincaid said he is leaving his post for a yet-to-be announced position outside the administration, according to an email he sent out Wednesday. Kincaid, a common sight in hotel lobbies and conference center hallways during TPP negotiating rounds, worked at the agency for three years, where his most recent title was deputy assistant USTR for media affairs. USTR’s press office lost another spokesman earlier this year when press secretary Andrew Bates took over as North Carolina communications director for the Hillary Clinton campaign.


— Sweden is pushing the EU to reject imports of live Canadian lobsters, arguing they could become an invasive species, CTV reports.

— Australian exporters are looking to China for new opportunities as companies take advantage of a new trade deal, Xinhua reports.

— Japan posted a $5.1 billion trade surplus in July even as exports sink by 14 percent compared to a year earlier, the Asahi Shimbun reports.

THAT’S ALL FOR MORNING TRADE! See you again soon! In the meantime, drop the team a line: and @ABehsudi; and @mmcassella; and @tradereporter; and @mjkorade; and and @JsonHuffman. You can also follow @POLITICOPro and @Morning_Trade.

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