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Trump Could ‘Vent His Frustration With China’ With New Tariffs, Expert Says

While many in the apparel and textile industry are thinking about what will happen to trade policy in a Biden administration, at least one political and trade expert thinks it’s better to be more shortsighted.

David Spooner, Washington counsel for the United States Fashion Industry Association (USFIA) and a partner at the Barnes & Thornburg law firm, said there are several trade issues up in the air in the waning days of the Trump administration.

Speaking on USFIA’s virtual Apparel Importers Trade & Transportation Conference, Spooner, a former assistant Commerce Secretary and chief textile negotiator under President George W. Bush, said one question is whether expiring China tariff product exclusions will be renewed. He noted that in August, the U.S. Trade Representative (USTR) announced that China tariffs exclusions on such products as backpacks, duffel bags and various yarns and fabrics would be extended to Dec. 31.

“The question then is will USTR act to extend these product exclusions again, three weeks before the end of the administration,” Spooner said.

“It is unlikely that in the next two months that the administration will pull out of the Phase One Deal with China or slap additional tariffs on China,” he said. “But I wouldn’t be complacent about it. I think we’re entering a two-month period where the administration will be less predictable about the course of policy.”

Spooner said it is possible that President Trump could look to “vent his frustration with China” and increase tariffs on imports from the country or impose new ones.

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Several other key trade provisions are in flux, he noted. The General System of Preferences (GSP) program is set to expire on Dec. 31 and will need to be renewed. Spooner noted that GSP last expired on Dec. 31, 2017, and “users were burdened with a three-month lapse until it was renewed.”

Current temporary duty suspensions, enacted in the Miscellaneous Tariff Bill, also expire at year’s end. The International Trade Commission sent Congress its recommendations for items to include in August, he noted. There is also pending legislation on the Xinjiang situation in the form of the Uyghur Forced Labor Prevention Act, which has passed the House and has bipartisan support, but will likely not be voted on until next year, he added.

Spooner looked ahead at ongoing trade talks between the U.S. and the U.K., and Kenya, both of which he said are “going slowly.”

“The only thing to look for in a Biden administration would be whether or not it puts trade negotiations with the U.K. on a slow boat and devotes resource to reinvigorating the Obama administration’s never-formally-abandoned trade agreement talks with the European Union,” he said.

“I think it would be naive of us to think that the Biden administration, at least in the short to medium term, would ease up on China tariffs,” Spooner added. “But I do think a Biden administration would be more traditionalist in that it would engage in multilateral institutions more actively than the Trump administration, such as the WTO, and would try to engage allies in an anti-China coalition.”