United States- Latin America and the Caribbean Trade Developments 2019 Washington, D.C., 2 December 2019 1 Thank you for your interest in this ECLAC publication ECLAC Publications Please register if you would like to receive information on our editorial products and activities. When you register, you may specify your particular areas of interest and you will gain access to our products in other formats. www.cepal.org/en/publications ublicaciones www.cepal.org/apps This United States Trade Developments 2019, is an annual report prepared by the ECLAC Washington Office. Raquel Artecona, Economic Affairs Officer, and Rex-Garcia Hidalgo, Senior Statistics Assistant, were the main authors, under the supervision of Inés Bustillo, Director, ECLAC Office in Washington, D.C.. In addition, Michael Cheung, Agustin Grizia, Harry Nitzberg, and Raphael Rodríguez, were involved in the research for this year’s edition. The views expressed in this document, which has been reproduced without formal editing, are those of the authors and do not necessarily reflect the views of the Organization. United Nations Publication LC/WAS/TS.2019/8 Copyright © United Nations, December 2019. All rights reserved Printed at United Nations 2 ECLAC - Washington, D.C. United States – Latin America and Caribbean Trade Developments 2019 Table of Contents Abstract ............................................................................................................................................................... 5 Introduction ......................................................................................................................................................... 7 I. U.S. Trade in Figures ..................................................................................................................................... 9 II. Trade Developments .................................................................................................................................... 15 A. The United States Mexico Canada Trade Agreement (USMCA) ........................................................... 15 B. United States-China: Escalating Tension ................................................................................................17 1. Increased Oversight of Chinese Foreign Direct Investment in the United States ............................ 19 2. Huawei ............................................................................................................................................ 20 3. Currency Manipulator Denomination .............................................................................................. 21 III. Import Policies ............................................................................................................................................. 24 A. Import Policies ........................................................................................................................................ 24 1. Trade Remedy Legislation ............................................................................................................... 24 2. Special 301 Report ........................................................................................................................... 26 B. Overview of Selected United States Dispute Settlement Cases Involving Latin American and Caribbean Countries ................................................................................................................................................ 27 1. Peru’s Timber Verification .............................................................................................................. 27 C. Agricultural Supports ............................................................................................................................. 28 1. The 2018 Farm Bill .......................................................................................................................... 28 2. U.S. Department of Agriculture Support Programs ......................................................................... 30 a. Market-Development Programs ........................................................................................ 30 b. Export Programs and Commercial Export Financing ........................................................ 32 c. Sugar Import Program ....................................................................................................... 32 IV. U.S. Foreign Assistance ............................................................................................................................... 34 A. Development Financing Program ........................................................................................................... 34 B. United States Foreign Aid ...................................................................................................................... 35 1. U.S. Foreign Assistance to Latin America and the Caribbean ......................................................... 36 Bibliography ............................................................................................................................................................... 39 3 ECLAC - Washington, D.C. United States – Latin America and Caribbean Trade Developments 2019 Tables Table 1 United States Trade in Goods by Region, Year to Date, 2018-2019 .................................... 10 Table 2 Trade in goods with Latin America and Caribbean Countries .............................................. 12 Table 3 U.S. Trade in Advanced Technology Products by Technology Group and Selected Countries and Areas, 2019 .................................................................................................... 14 Table 4 Economy-wide Impacts of USMCA .................................................................................... 16 Table 5 U.S. China Trade, Quarterly ................................................................................................. 18 Table 6 Chinese FDI in the U.S., 2015-2018 ..................................................................................... 20 2Table 7 Chronology of Escalating Tensions (Tariffs) Between the United States and China ........... 22 Table 8 Countervailing Duty Orders Affecting Latin America and the Caribbean ........................... 25 Table 9 Antidumping Duty Orders Affecting Latin America and the Caribbean .............................. 25 Table 10 Latin America and Caribbean Countries in the Priority Watch List and Watch List, 2018 .. 27 Table 11 2018 Farm Bill–Projected Outlays 2019-2023 ..................................................................... 28 Table 12 Specialty Sugar Allocations .................................................................................................. 32 Table 13 U.S. Raw Cane Sugar TRQ Allocations and Usage ............................................................. 33 Table 14 U.S. Foreign Assistance to Latin America and the Caribbean by Account, FY2013-2018 .. 37 Table 15 Foreign Assistance to Latin America and the Caribbean by Country, 2014-2018 ................ 38 Figures Figure 1 United States Trade in Goods, monthly Data, 2017-2019....................................................... 9 Figure 2 Regional Share in Total U.S. Trade in Goods ...................................................................... 11 Figure 3 Top 15 U.S. Imports from the Region, by Country of Origin, 2018. .................................... 13 Figure 4 Regional Distribution of Aid, FY1996, FY2006, FY2016 ................................................... 35 4 ECLAC - Washington, D.C. United States – Latin America and Caribbean Trade Developments 2019 Abstract United States Trade Developments, 2019, provides an overview of selected developments in United States trade relations with Latin America and the Caribbean and of measures that inhibit the free flow of goods among countries in the Western Hemisphere. This is an annual report elaborated by the ECLAC Washington Office. The United States trade policy priorities in 2019 included efforts to obtain Congressional ratification of the United States-Mexico-Canada free trade agreement (USMCA). The renegotiated USMCA, signed on 30 November 2018, revises rules of origin for vehicles, expands market access in agriculture and revises investment protection. It expands labor and environmental protection in the agreement itself and includes new topics such as digital trade, state-owned enterprises, and currency manipulation. In addition, a major priority was advancing negotiations with China to address, among other, the U.S. bilateral current account deficit, technology transfer, intellectual property protection, and non-market policies. Tariffs and/or other trade restrictions based on investigations under U.S. trade laws such as Section 201 and Section 301 of the Trade Act of 1974 and Section 232 of the Trade Act of 1962 were employed in seeking elimination of concerns with unfair policies and practices. Also, the Administration negotiated and signed in September the first phase of a trade agreement with Japan that would gradually reduce tariffs on U.S. agricultural products and U.S tariffs on Japanese industrial products. Negotiations for a second phase trade agreement will start in 2020. The report presents a description of trade flows between the U.S. and Latin American and the Caribbean. The region has been one of the fastest-growing regional trading partners for the United States, with Mexico becoming its number