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Trade Subcommittee Chairman Smith Opening Statement – Hearing on Advancing American Interests at the WTO’s 13th Ministerial Meeting

February 07, 2024

“The purpose of today’s hearing is to help us meet this moment and signal to the Biden Administration what strong U.S. leadership at the WTO looks like. These should not be partisan issues.”

As prepared for delivery.

“Thank you, Ranking Member Blumenauer, Subcommittee Members, and our witnesses for being here today. We meet at an important time for international trade. At the end of the month, the world’s economies will meet in Abu Dhabi for the World Trade Organization’s 13th Ministerial Meeting.

“This Ministerial represents both a challenge and an opportunity. On the one hand, protectionist nations aim to use the Ministerial as a chance to undermine intellectual property rights, fragment the global internet, and promote gross protectionism in agriculture. Despite this, the Ministerial offers a pivotal opportunity for U.S. leadership. Countless WTO Members are looking to the United States to defend the free flow of data, protect IP rights, and drive a hard bargain for new rules against unfair practices, starting with fisheries subsidies.

“The purpose of today’s hearing is to help us meet this moment and signal to the Biden Administration what strong U.S. leadership at the WTO looks like. These should not be partisan issues.

“Since 1947, the multilateral trading rules have been a key element of American competitiveness. Today, 65 percent of U.S. trade is covered exclusively by WTO rules rather than any rules from our free trade agreements. Our farmers, ranchers, small businesses, and workers need strict enforcement of these rules to export competitively.

“Yet, the WTO is not without challenges. Negotiations for new trade agreements have stalled as a handful of spoiler countries veto progress on new agricultural market access or trade in environmental goods. Judicial activism by the WTO’s Appellate Body has undermined confidence in the organization and degraded the ability of the United States to hold China accountable for its unfair practices. Many countries—but especially China—either do not play by certain rules such as those requiring notification of subsidies, or in other cases, engage in predatory, unfair, and anti-free market behavior outside the scope of the WTO’s rules. All of these challenges come at a cost to American farmers, workers, and small businesses.

“These concerns about the WTO are widely-shared, long-standing, and bipartisan. Yet, the Biden Administration appears poised to cede U.S. leadership.

“I was deeply disappointed when the Administration withdrew robust digital trade proposals from the ‘Joint Initiative on E-commerce’ negotiations at the WTO. These rules—which received overwhelming bipartisan support in the U.S.-Mexico-Canada Agreement—are key to U.S. innovation leadership. This digital trade abdication does not inspire confidence that the Administration will vigorously defend the renewal of the longstanding moratorium on the imposition of customs duties on electronic transmissions.

“Similarly, I strongly opposed the waiver of IP rights for COVID-19 vaccines that the Biden Administration agreed to at the 12th Ministerial. To make matters worse, the Administration is considering whether to expand that waiver to the IP for diagnostics and therapeutics. Such a move would be as harmful as it is illogical. Recent independent analysis by the International Trade Commission found that generally IP is not a barrier to access for COVID-19 treatments.

“At the last ministerial, WTO Members finally reached an Agreement on Fisheries Subsidies. While I was pleased to see some progress to limit subsidies for illegal, unreported, and unregulated fishing, the initial agreement does not cover other harmful practices like forced labor or subsidies that contribute to fishing overcapacity. As WTO members discuss a second phase of the Fisheries Agreement later this month, we need to know that the Biden Administration will negotiate aggressively to address these exploitative practices. 

“I want to thank our witnesses again for their participation, and I look forward to hearing what we can do to ensure continued U.S. leadership at the WTO.”