Bloomberg Audio Studios, podcasts, radio news.
The conflict in the Middle East whipsawing food prices and creating uncertainty for global trade. Palmer Am Marie John is from Washington now with a special guest, a Marie. Good morning, John.
That's right, an individual who just met with a number of the US trade partners at a wto meeting and Cameroon is Ambassador Jamison Greer, the United States Trade Representative.
Ambassador gear Good morning, Thank you so much for joining me.
Good morning, great to be here.
So you just got back from meeting with a number of trade partners, and at the moment, global trade is upended by what's going on in the Strait.
Of her Moose.
Did you have an update to give American trading partners about the flow of trade through that critical waterway.
Well, right now. I think the thing to understand is that the United States is generally insulated from a lot of the supply chain effects when it comes to direct commodities and things like that. For a lot of that, we have domestic sourcing. We have sourcing from our partners to the north and south of US and other places. But obviously we're aware that this has an impact in other countries, particularly in Asia. We know that their supplies
are tight, and so we're watching that really closely. When I was meeting with all of them, this was not particularly high on their agenda things to discuss with me because we were meeting for other reasons. But we're monitoring the situation given that the supplies of commodities coming out of the Gulf can affect our treating partners longways.
And it's not just crude, it's loqualified petroleum gas, which you need, especially in countries like India to cook.
It's fertilizer. Do you have a sense of a timeline.
Well, you know, first of all, any kind of operation, you're focused on objectives and you don't want to set artificial timelines. When I hear from the Secretary of State of sectur of Defense, they talk about, you know, operations in terms of weeks. We hope that's the case. The Trump administration has made a lot of headway and its objectives in Iran in terms of destroying ballistic missiles, destroying the navy, and making progress to make sure that they don't have in a nuclear weapon.
You met on the sidelines with your Chinese counterpart. China buys the lion's share of Iranian crude. We have seen Chinese vessels given safe passage to Destrait. Did this become a focal point of that conversation.
It did not.
When I met with my counterpart, Minister Wong, the Ministry of Commerce minister, this did not come up. We were focused on preparing for the Leader's meeting, which will occur in mid May. We were talking about the WTO itself and the future of it, or potentially lack thereof, as the case.
May be, And so black there up youre thinking about getting.
Out, well, I wouldn't say that. I would just say that the ability of the World Trade Organization to meet the needs of the moment, addressing structural imbalances, currency issues, huge export driven surpluses by other countries, the WTO has never been able to address those things and it won't be going forward. It can barely address issues on its current agenda.
So potentially you want a revamp of the WTO.
Is that what you're calling for?
I will tell you that we have called for a reform. The Trump administration has put in many proposals, concrete proposals about reform about how to graduate countries to take on more obligations as they become more developed. We've talked about making sure that countries can adjust their tariff schedules to account for national core interests, and we put forward a reform plan together with a bunch of trading partners at a recent meeting and Cameroon, and there was near consensus
on this. Countries like Brazil and Turkey eventually opposed the closing package, which is unfortunate, but it's also kind of exhibit a of how the WTO's unable to address these core challenges.
Back to the street.
In your conversation with your Chinese counterpart, the President has been pretty direct to European allies, if you want the straight to open, you should also help us send vessels, send a mind.
Sweep er, send your navy.
If China is the one that's benefiting the most in terms of they're the ones that for years have been supporting this brutal regime.
Should they also not be on the hook to reopen the street.
Well, listen, this is a decision for China, and I'll obviously let the President and TERFF, State and SECT Turf Defense decide how they're going to line with other countries in reacting to the straight Offomus closing. Again, it affects these other countries much more than affects US.
Other countries have been.
Working with Iran to figure out arrangements to get out oil, gas, fertilizer and all these other things. But it is clearly in the interest of the world community to make sure not only to make sure that the Strait is open, but to make sure that Iran doesn't get a nuclear weapon, Iran doesn't empower its terror proxies in the region. The world would be much safer if the world was aligned on taking care of the Iran issue.
As you prepare for this trip, there's a lot of reporting that China, like Russia, is helping Iran, even when it comes to not just supply chains but targeting US troops. Is this going to be on the agenda when the president meets? Is this even potentially a reason why the trip could maybe get postponed.
In past meetings between the presidents, they've always talked about conflicts and hotspots. In the past, they've talked about Ukraine and Russia, They've talked about Iran. Assume that they'll talk about these things again. With respect to your question, is there going to be a delay in the meeting. I haven't heard talk about that either internally. I didn't hear that from my Chinese counterpartment. I talked him last week.
When it comes to the tariffs right now, there's Section three or one tariffs that you're looking into when it comes to China, and we've seen China actually have their own announcement that they're going to investigate US companies. This tit for tat we might see in the trade between Ijing and Washington back to where we're almost what it feels like.
A year ago.
Do you think that's going to hinder the US from getting back to the twenty percent level they were at before I eep it was struck down.
I don't think so. When you look back to the Busan agreements, the agreements we achieved with the Chinese last year, we were seeking stability. We were seeking to receive, achieve a level of tariff application on one side and the flow of rare earth minerals and things from the other side. Both sides want stability, Both sides want to see continuity.
The Chinese know that the United States is trying to control for our you know, giant trade deficit, we've had with China for a long time, which went down by thirty percent last year, by the way, So I don't think it's going right.
But China's imports to other countries in the and I went up, and then those countries are important to the United States, don't you have an issue with transhipment at the moment?
So there's there's always been an issue with transhipment. But when you look at our shipments from third countries outside of China since April, right since Liberation Day, that deficit has gone down by seventeen percent. So while there may be some transhipment, overall, our trade deficit is going down, so down with China, it's going down with the rest of the world. It's going exactly the right production direction. At the same time, wages are going up in America, productivity is going up.
Do you think you're going to get to the twenty percent level?
Well, I can't prejudge the investigations right at Section three oh one. We have to go through the legal process. We have to collect information. It's quite public, it's quite transparent. You know. We know what the nature of the deal is that we struck with the Chinese, so we will see. All I know is that the President for sure is going to keep protecting our economy. He's going to protect our producers so we can continue to have increased production in the US increase wages here.
If China plays hardball though, not just with their own investigations, but potentially bringing rare earths back into the foraight. I know they have basically till October. There's a deal on the table potentially, then would you look to maybe decrease the tariff level.
Well, you know, from our perspective, we're looking for stability. We're trying to achieve we're trying to get the trade deficit reduced, We're trying to increase manufacturing in the United States, and we're trying to increase real wages and all of that is happening. So we don't see a need to change our policy. The Chinese wants stability, We want stability.
I actually see a positive agenda with China going forward, where we learn to manage our trade with each other, where we pick the kinds of things we want to be selling to each other, things that are mostly non sensitive, to avoid some of the national security elements that prove challenging and negotiations. I see stability with China over the next year.
When it comes to this extension on rare earths, Are you going to need one in October or will you think the United States is in a place where we don't extension.
Well, we've made a lot of progress. We have a few months, so I think we'll assess that down the road. You know, we have Project Vault where we're stockpiling a lot of critical minerals and rare earths. We have new projects in the United States to mind process and manufacture rare earths, including permanent magnets that we need for different motors.
We're working with our counterparts and our trading partners Australia, the EUGE, Pan, Mexico to find projects we can do together to increase supply chain security.
How much will weare Earth's.
Be on the table this discussion with the President in Shijing Pang in May.
So when we met in Paris with our Chinese counterparts a couple of weeks ago, we talked about rare earths. The process with the Chinese is working fairly well. There are a few things here and there where we highlighted that we didn't feel like we were getting rare earths in a timely fashion, and we highlighted that to our partners. They took note of that and have it under consideration. So the presidents will talk about it if they need to.
Our hope and expectation is that we're able to manage a lot of it between now and then.
At the staff level, do you think you're going to have to meet your counterparts again before for the big leader meeting in Beijing.
I don't think we're going to need to do that, particularly when we were in Paris. We reach general agreement on the types of outcomes we want for the leader's meeting, and right now our deputies and our staff community are in regular communication to try to land all those outcomes.
Can you give us any sense of what the main deliverables are going to be in Beijing?
I think that one of them. In people. There's been a little bit of coverage on this. We've been talking about a board of trade, a US China board of Trade, which really will be a mechanism to help manage trade. Over the past ten years or so, as the United States has tried to eliminate its trade deficit with China, figure out its export control situation, if we can formalize the mechanism a little bit to make sure that we are we can agree on things we are selling to
each other. For the US, we want to be selling boeings, we want to be selling medical devices, pharmaceuticals, AG products, things like that. You know, the Chinese want to be selling things to us, and we're willing to buy things like you know, low tech consumer goods and things like that, certain commodities that maybe the Chinese have that we don't.
And so coming establishing that type of mechanism at the leader's meeting and then going through a process of figuring out how to optimize trade with each other, that's going to be a
Big deliverable Ambassador Grow, Thank you so much for your time this morning.