USA launches trade deficit investigations
Washington - United States Trade Representative Jamieson Greer has initiated proceedings against Switzerland, the European Union and 14 other countries in relation to structural excess capacities. In so doing, he is gearing up to impose penalties against the economies in question.
(CONNECT) The US Trade Representative Jamieson Greer has initiated investigations against 16 economies, as detailed in a statement published on March 11. In this context, he makes reference to Section 301 of the US Trade Act of 1974.
Section 301 addresses unfair trading practices by trading partners and permits the imposition of countermeasures such as import tariffs and restrictions, as well as the suspension of trade agreements. Under the terms of Section 301, the US can even demand compensation payments from trading partners. These countermeasures can affect trade in goods and services. In addition to Switzerland and the European Union, the proceedings are also directed against Bangladesh, China, India, Indonesia, Japan, Cambodia, Malaysia, Mexico, Norway, Singapore, South Korea, Taiwan, Thailand and Vietnam.
In his document announcing the initiation of the investigations, Greer points to the high trade surpluses run up by these economies. For example, Switzerland is said to have recorded a trade surplus in the amount of 75 billion US dollars in 2024, which is equivalent to 8 percent of its total economic output. As Greer argues, this is evidence of Switzerland’s structural excess capacity and production. Moreover, he asserts that Switzerland actively pursued policies such as currency intervention and sterilization of foreign exchange inflows.
In a next step, the cited countries will have the opportunity to present their side of the argument. Greer will be holding hearings from May 5 onwards to this end.
Greer justifies these measures by referencing the reindustrialization policy pursued by President Donald Trump. “Today’s investigations underscore President Trump’s commitment to reshore critical supply chains and create good-paying jobs for American workers across our manufacturing sectors”, he explains in the statement.
These investigations launched by Greer can be seen as a response to the ruling of the US Supreme Court on February 20, according to which the President Trump’s arbitrarily imposed import tariffs had no valid legal basis. ce/ug
