Growth Commission welcomes Trump’s Executive Order on Trade Policy

Growth Commission welcomes Trump’s Executive Order on Trade Policy

The Growth Commission has welcomed the Executive Order from President Trump instigating an investigation into unfair foreign government practices that harm U.S. trade and how the new administration might respond to them.

Included in the America First Trade Policy (AFTP) Memo signed by the President following his inauguration, it echoes the proposal in the Growth Commission’s Growth Presidency Memo that the imposition of new tariffs would be justified in cases where countries such as China are distorting their markets in anti-competitive ways.

These distortions include actions that artificially favour foreign exports, deny non-discriminatory market access for U.S. firms, harm U.S. competitors’ Intellectual Property rights and otherwise involve foreign government toleration of systematic anti-competitive activities.

The AFTP Memo gives executive departments and agencies until 1 April to issue reports to the President on actions his administration could take to address specific international trade problems. In another echo of the Growth Commission proposals, the Memo also calls for an investigation into the countries with which the U.S. might be able to sign trade deals.

Shanker Singham, Chairman of the Growth Commission, said:

“I’m very encouraged by President Trump’s initial pronouncement on trade policy.

“The Growth Commission recommended that the UK be top of the list for a potential trade deal and that the administration should also develop a core group of trading allies, including Australia and Japan, which is particularly exposed to China’s market-distorting practices.

“These countries should commit to removal of their anti-competitive market distortions (ACMDs) and agree disciplines on countries that maintain them. This ‘economic NATO’ would kickstart economic growth in the group and, by having concrete disciplines on ACMDs elsewhere, would also stimulate economic growth in the rest of the world.

“Our Growth Commission economic models suggest that we have barely scratched the surface of what is possible in terms of economic growth as a result of reducing these distortions. President Trump is showing the way and the rest of the G7 should follow.”