| | | | |  | | By Ari Hawkins | | | — Mexico’s government is threatening to use the USMCA and the WTO to challenge the U.S. Agriculture Department’s labeling rules, adding to a list of disputes looming over North American trading partners ahead of a 2026 review. — The House Select Committee on China’s bill to crack down on TikTok sailed through the chamber, but there’s little consensus over whether the panel’s mandate will be extended, lawmakers and staffers on both sides of the aisle tell POLITICO. — Rep. Jim Banks is urging Commerce Secretary Gina Raimondo to launch a probe that could lead to new EV restrictions as former President Donald Trump pushes a proposed 100 percent tariff targeting autos made in Mexico by Chinese companies. It’s Monday, March 18. Welcome to Morning Trade! Did you partake in a Saint Patrick’s Day celebration over the weekend? Frankly, as long as you weren’t booed for being tardy to the annual parade like former Mayor Bill DeBlasio in 2015, your luck was good. Got some trade news to share? Reach us at: ahawkins@politico.com, gbade@politico.com and dpalmer@politico.com. You can also follow us on X: @_arihawkins, @gavinbade and @tradereporter.
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| | |  The Mexican economic ministry blasted labeling regulations from the U.S. Agriculture Department as “discriminatory to Mexican producers.” | Alastair Pike/AFP via Getty Images | MEXICO SHARPENS TONE OVER USDA RULE: Mexico is threatening to challenge the USDA’s new labeling regulations citing U.S. commitments to its North American trading partners under the USMCA and the WTO, fueling strain ahead of a mandatory six-year review. One step back: USDA announced last week that starting in 2026 animal products will need to be born, raised, slaughtered and processed in the U.S. to use "Product of the USA” or “Made in the USA” labeling. The provision addresses a so-called loophole that allows cattle born and raised in Mexico, but slaughtered and packaged in Texas, to be labeled “Made in the USA,” which critics say undermines the U.S. beef market and cuts into ranchers’ paychecks. Mexico’s view: The Mexican Ministry of Economy blasted the rule as “discriminatory to Mexican producers” and said the measure could create barriers to their exports of cattle and beef. The statement warned the measure “contravenes” on economic integration principles central to the USMCA, according to a translated release dated Thursday. Mexico said it would prefer resolving disputes with the United States through “constructive dialogue” but said the government would consider “using the mechanisms available in both the [USMCA] and the WTO with the objective of guaranteeing that the United States comply with its commitments regarding Technical Barriers to Trade,” according to the statement. “The Ministry of Economy urges the U.S. authorities to reconsider this rule and intensify dialogue with their Mexican counterparts to avoid negative repercussions on bilateral trade,” the statement added. From Ottawa: Canadian Minister of Agriculture Lawrence MacAulay and International Trade Minister Mary Ng also expressed concern about potential supply chain disruptions to North America’s meat and livestock industries. They said Canada intends to press Agriculture Secretary Tom Vilsack to discuss the issue in a meeting of USMCA agriculture ministers in Colorado this month. On the horizon: The frustration adds to a lengthy list of disputes that could take central focus as the North American partners gear up for the USMCA’s six-year review in July 2026, during which all three countries will have to confirm that they want to continue the agreement. Otherwise, the pact is scheduled to expire after another 10 years. Going deeper: Among other issues on the table: Canadian dairy market access barriers where the U.S. remains frustrated by Ottawa's stonewalling, and another involving auto trade rules where the United States still has not complied with a negative ruling in a case brought by Canada and Mexico.
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House Select Committee on the Chinese Communist Party Chair Mike Gallagher (R-Wis.) speaks with reporters outside the U.S. Capitol after the House passed a bill that could result in a U.S. ban on TikTok over national security concerns March 13, 2024. | Francis Chung/POLITICO | THE FUTURE OF THE CHINA COMMITTEE BLURS: Lawmakers and staff on both sides of the aisle are engaged in a tug-of-war over reauthorization of the House Select Committee on the Chinese Communist Party after its current mandate expires. "The China committee should and must continue because it is the only committee that can comprehensively cover every dimension of U.S.-China strategic competition, which will remain the central challenge confronting the world for decades to come,” said Rep. Ritchie Torres (N.Y.), a Democrat on the panel. Not everyone feels that way. Some committee members say that if the committee can build on the momentum from its TikTok bill and pass more of the economic recommendations included in the panel’s policy report last year, its work could be largely accomplished. “In general, I think it’s best to have a select committee like ours be a short term project,” said Rep. Dusty Johnson (S.D.), a Republican committee member. Tension rises: Other senior lawmakers are expected to push back on continuing the China Committee next Congress, regardless of which party wins the majority. The China Select Committee has “no power” but “moonlights in stealing our jurisdiction,” said a staffer for a member on a House standing committee, who asked to remain anonymous to detail internal deliberations, adding their office would not endorse renewal. At the same time, some Democratic staffers have signaled they aren’t confident the Select committee will stand up to Trump’s most extreme proposals if he were to win the 2024 contest, undercutting the panel’s mission of ensuring a balanced approach to China policy. “Republican members … no matter how moderate they claim to be, I think, all live in fear of him,” said one staffer for a Democrat, referring to Trump. The staffer pointed to the exit of committee Chair Mike Gallagher (R-Wis.), saying those leaving “are Republicans that are not going to have to answer the Trump question for the next two years, should he win.” What’s next? For now, leaders of the House and the China committee are keeping quiet about the panel’s future. Gallagher said he hasn’t had any conversations about re-upping the panel, and ranking member Raja Krishnamoorthi (D-Ill.) said the question was premature. Gavin, Meredith Lee Hill and your host have more.
| | GOP INTENSIFIES AUTO TARIFF PUSH, EYEING CHINA: Rep. Jim Banks (R-Ind.), who is gearing up for a Senate run this year, said he disagrees with the Biden administration’s promotion of electric vehicles, claiming the EV industry threatens hundreds of thousands of jobs and will require billions of dollars in subsidies and tax credits. “That said, because your administration has decided to force EVs upon the American automotive sector and on American consumers, you must also ensure that these vehicles are made in the United States,” Banks said in a letter to Commerce Secretary Gina Raimondo. Banks specifically requests Raimondo to launch an investigation under Section 232 of the 1962 Trade Expansion Act, the same authority that former President Donald Trump used to impose national security tariffs on steel and aluminum imports in 2018, triggering a wave of trade retaliation and roiling relations with countries in Europe, North America and Asia. The request puts political pressure on Raimondo as President Joe Biden vies for blue-collar votes in this year's presidential election. Trump has also taken note of the growing concern over China’s automotive dominance, and said he would target autos made in Mexico by Chinese firms with a 100 percent tariff, adding there would be a “bloodbath” if he does not win the 2024 election. “Those big monster car manufacturing plants you are building in Mexico right now and you think you are going to get that — not hire Americans and you’re going to sell the car to us, no,” Trump said, addressing Chinese leader Xi Jinping in a speech over the weekend. “We are going to put a 100% tariff on every car that comes across the lot,” Trump said.
| | | | DON’T MISS AN IMPORTANT TALK ON ACCESS TO AFFORDABLE PRESCRIPTION DRUGS IN CA: Join POLITICO on March 19 to dive into the challenges of affordable prescription drugs accessibility across the state. While Washington continues to debate legislative action, POLITICO will explore the challenges unique to California, along with the potential pitfalls and solutions the CA Legislature must examine to address prescription drug affordability for its constituents. REGISTER HERE. | | | | | | | | | — The transatlantic commercial relationship now runs upwards of $8.7 trillion, supports 16 million jobs on both sides of the Atlantic, and accounts for one-third of global GDP, according to a report out today, shared by the U.S. Chamber of Commerce. — The American Apparel and Footwear Association sent a letter dated Thursday to congressional leaders urging "immediate action" to ensure the reauthorization of the HOPE/HELP program. — The Canadian behind the West's massive sanctions on Russia says it's time for Round 2, POLITICO reports. — First Gaza aid ship unloads supplies at besieged enclave, POLITICO reports. — Pressure on U.K. to follow U.S. in toughening stance on TikTok, POLITICO reports. — EU top envoys clinch deal on controversial business supply chain oversight rules, POLITICO reports. THAT’S ALL FOR MORNING TRADE! See you again soon! In the meantime, drop the team a line: dpalmer@politico.com, gbade@politico.com and ahawkins@politico.com. Follow us @POLITICOPro and @Morning_Trade. | | | | Follow us on Twitter | | | | Follow us | | | | |
