By Yuka Hayashi
WASHINGTON -- President Biden's pick for U.S. Trade
Representative said she would accelerate negotiations with the
European Union to resolve a longstanding dispute over
commercial-aircraft subsidies, citing the fight's negative impact
across several industries.
Speaking at her confirmation hearing Thursday before the Senate
Finance Committee, Katherine Tai, a veteran government trade
lawyer, said the 16-year-old dispute over how governments subsidize
Boeing Co. and Airbus SE has led to counter-tariffs -- sanctioned
by the World Trade Organization -- on food and beverage products,
causing "disruption" and "pain."
"At the core of this...is the need for the U.S. and the EU to
come together to figure out an answer," Ms. Tai said. "I would very
much be interested in figuring out how to land this particular
plane because it has been going on for a very long time."
Separately Thursday, the Senate confirmed the first Biden
nominee to an energy and environmental post, approving Jennifer
Granholm to become energy secretary by a 64-35 vote. The former
Michigan governor had been one of Mr. Biden's least controversial
nominees, winning support from unions, environmental groups and
Ms. Granholm has emphasized climate change as a priority and
takes charge of a department that controls federal loan programs
and research funding for the energy sector. She previously told
Senators the programs could help build up employment in
Ms. Tai is also expected to receive Senate confirmation as she
enjoys support from lawmakers from both parties, as well as from
business groups and labor unions.
Restaurant and beverage industries have been pushing for a
solution to the aircraft dispute, which has heaped pressure on
businesses already struggling with the Covid-19 pandemic. The Trump
administration imposed tariffs on $7.5 billion worth of European
wine and food items such as cheese and olives in late 2019. The EU
hit back with levies on U.S. whiskey, nuts and tobacco.
The EU's trade commissioner, Vladis Dombrovskis, called for a
mutual suspension of tariffs in the aircraft dispute this
Ms. Tai has spent much of her career in the government, first as
a lawyer for the Office of the U.S. Trade Representative, then as a
congressional staff member. If confirmed, she would be the first
Asian-American and the first woman of color to serve in the
Asked if she would consider lifting steel and aluminum tariffs
imposed by former President Donald Trump on America's allies, Ms.
Tai suggested a simple and immediate elimination of the duties is
unlikely, saying they should be dealt with as part of a broad
policy to address global oversupply of the metals.
Mr. Trump in 2018 imposed tariffs on about $50 billion of
imported steel and aluminum, calling the global oversupply of
metals a "threat to national security." The duties hit allies such
as the EU and Japan, not just China.
"We have to acknowledge that we have overall a very significant
global marketplace problem in the steel and aluminum that is driven
primarily by China's overcapacity," Ms. Tai told lawmakers. "What
we are going to need...is an effective solution that looks at a
whole slew of policy tools to address the problem."
Ms. Tai said tariffs are a "legitimate tool in the trade
Biden administration officials have said they would review all
tariffs and other trade policies introduced by Mr. Trump. Trade
experts say that rather than eliminating tariffs already in place,
the administration is likely to use them as leverage to win
concessions from trading partners.
On China, Ms. Tai said the U.S. needs to work closely with
allies while strengthening domestic industries and supply chains.
She suggested a top-to-bottom review of the agency's China policy,
the first since the early 2000s.
"I know firsthand how critically important it is that we have a
strategic and coherent plan for holding China accountable to its
promises and effectively competing with its model of state directed
economics," she said.
During her previous stint at USTR from 2007 to 2014, Ms. Tai
served as its chief enforcer against China. Her parents were born
in mainland China, grew up in Taiwan and moved to the U.S. for
graduate studies before she was born. A Mandarin speaker, Ms. Tai
spent two years in China teaching English after college.
Asked whether the U.S. should join the Trans-Pacific
Partnership, an Asia-Pacific trade agreement negotiated under the
Obama administration and shunned during the Trump era, Ms. Tai
didn't provide a direct answer. She said working with U.S. partners
to counter China remains a "sound formula," but added that the U.S.
has recently become more aware of some of the pitfalls of
traditional trade agreements.
"In the longer term, we must pursue trade policies that advance
the interests of all Americans -- policies that recognize that
people are workers and wage earners, not just consumers," she
Ms. Tai said she would make it a priority to implement a
renegotiated trade agreement with Canada and Mexico, including new
tools to enforce labor and environmental standards. The United
States-Mexico-Canada Agreement, or USMCA, went into effect in July
last year, replacing the North American Free Trade Agreement.
"Too often in the past, Congress and the administration came
together to finalize and pass a trade agreement," she said. "But
then other urgent matters arose and we all moved on."
--Timothy Puko contributed to this article.
Write to Yuka Hayashi at email@example.com
(END) Dow Jones Newswires
February 25, 2021 17:18 ET (22:18 GMT)
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