The committee will cut the committee will come to order. Today, we welcome ambassador , including or negotiations with china, japan, and u. S. He u. K. Participation in wto. We are pleased to welcome you back. Have been eager to consult with you and it has taken a while to get this hearing on the books. To the members of the committee and american public, the democrats are already engaged with you and and allows us to further the engagement. I commit to you as a half the past many months, continue working with you on nafta in good faith based on facts and a desire to make responsible policy. The opportunity we have to ove nafta we can ensure that there are protections respected and Affordable Access to medicines is for now and the future. All of this is too important to rush. Im not the only person making this point. It is consistent from the. Usiness roundtable i believe from working with you, wef a lot in common have a lot in common. With respect to a larger trade agreement agenda, a lot of activity. We have negotiated and renegotiated a trade agreement u. K. Hina, japan and the we are also hearing interest from switzerland and the republic of georgia and bilateral trade agreement opportunities for the on dates. Seeking toe. Egotiate reform outcomes administration also threatened to impose 5 caps on mexico. Quite concerned that these threats continue to be dangled over mexico and, u. S. Trade policy is an abuse of power and something i do not support. I commend you for trying to tackle some longstanding trade issues with china, any gains to the agendaect will be eroded. Most importantly, i think the administration is to think broadly and be honest about its policies and how they impact American Workers. We are supportive of your fromts to secure change china to level the Playing Field and investment. At the same time, we see tax policies, education policies, worker policies and border policies that undercut American Workers and make it more difficult for middleclass families. The committee is ready to stand with you for the benefit of all americans and now let me recognize the Ranking Member for an opening statement. For testifying. America has regained the title of the most competitive economy in the world, growing faster than experts predicted, wages are grown for the first time in a decade and American Manufacturing is back and for the first time in modern history , more direct investment is blowing into the u. S. Been is leaving. To grow the economy further, we need more customers. That is what free and fair trade can do. Present from has worked tirelessly to bring trade relationships into the 21st century and most important among them is the u. S. Embassy. It sets a High Standard in many crucial areas for america and additional trade customs, producing strong winds wrong to strong wins and make sure america receives the full benefits. Congress must approve the agreement to unlock these benefits. Every day it is delayed, america suffers. By fixing its shortcomings, they will grow americas economy, american jobs and higher wages. The longer it takes, our country will lose out on more jobs, or customers in a stronger economy. I look forward to working with you closely and achieving strong support for us quickly as possible without delay, strengthening our north American Economy will build momentum or other trade negotiations and first among these is china. Theres bipartisan agreement that chinas predatory trade theftces from technology is unacceptable. President trump is the first president to take china had on head on. The president is right to insist on a new trading relationship to fair, measurable and enforceable. China does not live up to the commitments, we must have a consequential response. I may not like terrorists everyonebut i and knows that china has been cheating for far too long. President trump is right to challenge them and insist on real change. While the tariffs are in place, need give relief to American Companies. Republicans are committed to working with need you and contio do so to resolve these longstanding issues. We are at a rare moment of time can have. S. And china trade that benefits all. China, we must allow for as many markets as possible for American Goods and services. They include japan, the eu, u. K. And potential new partners. We must also reform the wto to address nonmarket economies in meaningful ways to fix the overreach and ambitious negotiations with the countries that are ready to address the world changing climate. Technology, on the reduce Carbon Emissions around the planet and we expect you accordinglt with us to the requirements of the trade act of 1974. Let me conclude by noting on the path to another year of 3 growth, it is possible to achieve the goal. For workers finally seeing paychecks grow after years of stagnation, mainstream who feeds, farmers their families, lets move forward on our ambitious trade withoutnning with further delay. You. Ank all Opening Statements will be made part of the record. The committee has received a written statement and have five minutes to deliver oral remarks. Chairman,ou, mr. Ranking member and members of the committee, a pleasure to. Ppear before you today begin by noting that the American Economy is doing well. We are growing substantially faster than any other g7 country. Sinceed 5. 8 million jobs the 2016 election, notably 500,000 of those jobs are in manufacturing. Lowest in nearly half a century and has been for nearly 15 consecutive months. Hears,y to what one exports are growing. In 2018, it was the highest year in our history where exports on both goods of services and services. In 2018 were up over 2017 and 2016. Im pleased to present the trading policy report of the committee. Outlinedment recently the administrations trade president isthe troubled by huge and persistent trade deficits that the United States has with many countries. They are the result of many factors, faster Economic Growth and current his violations and some extent, tax policy, but they also partially result of tradable that are often times. Nfair to americans we are very much focused on changing these rules when they are unfair to American Workers and businesses. Renegotiatingded nafta and also have been ruling gs the eligibility around the world, actively engaging in talks with many countries, reviewing the roles and functions of the wto. They have been in active enforcing the existing trading partners and brought many wto cases. Have work with members on proposals to improve compliance with existing rules and engaged directly with trading partners under existing agreements. For example, we have resolved concerns with peru after requesting the first consultation in the trade promotion agreement. In addition, we have used section 3012 investigate unfair trade practices in china and believe it has been unbalanced and grossly on their to American Workers. After an exhaustive process, we put tariffs on certain products and prepared to put more in place of certain issues are not resolved satisfactorily. Finally, please to testify on the negotiation of the [indiscernible] many of the improvements have reflected republican and democratic members thoughts. It is the strongest trade agreement in u. S. History. It is the Gold Standard on the it will helpmy and to stop the outsourcing and manufacturing and return many jobs to the United States. Farreaching ever negotiated in a trade agreement. The agriculture chapter will will eliminate unfair trading practices. This is truly a great agreement and i look forward to working with members to make it even better. With that, i will stop. Forward to your questions. We will now move to questioning under the live minute rule. First. Down, recognized i was surprised when the president announced his intention to impose 5 tariffs immigrationer issues, particularly when you on the same day of the president s announcement. What is the legal policy rationale for imposing such tariffs and you think the president s threat undermines efforts to pass the new nafta . That would be yes, yes and no. Do i support it . Absolutely. Do i think it is more difficult to pass . No reason in my judgment why should. [no audio] i support the president entirely on that. We could use National Security based on the border issue with mexico . Im not an expert on that, but the answer in my judgment is yes. If you declared a national emergency, you could use it for that purpose. The phase and the consultation process must be driven by substance and not arbitrary deadlines. Assurances that you will give us the space and time to work out these complex issues. It is important that we get this right once and for all. Care to comment . All, i have worked with republicans and democrats from day one. 90 of members, ive had personal conversations with. By no means, a partisan approach and so that would be the first thing i would say. Speaker agree the i would say the bill has been public and we have been in negotiation for nine months, so i dontinto that, believe waiting nine months is rushing anything. I think we are in a position where the members know what they want. I know what the members want. It is a question of sitting down and deciding where the lines are. That is what i have been getting to for some time. Im very grateful for that. Asi said, all respect treated the process fairly and not surprisingly, has done this ok, bey eager to say able to say here, i will do this. You just have to get to that stage. I guess the final thing or say is getting this done sooner rather than later is in everybodys interest. It avoids the possibility of having something unrelated and there are tens of millions of jobs. Improvement in getting it over the finish line is important to the American People. Thank you. Shamefulk it is congress has turned a blind eye. Real people are suffering and it is Shameful Congress has time for congress p and take care of those kids. I think we can have Strong Border relationships, securing with mexico and pleased to see the white house negotiated improvements to security and now our job in congress to pass trade relationship. Let me start with china. Where are we with china . What are your expectations for President Trumps meetings and do you expect talks from which there is great substance. Top to start . Hose as you say, we had negotiations with china for this is extremely important. We have a very unbalanced relationship with china and one that risks the jobs of the future of america, so it is important we get the relationship right and do not go the way they have gone on, escalating and getting worse. Had negotiations for months and i think we were making good headway. At that point, negotiations stopped. I think it is in the interests of both china and the United States to have a successful agreement. The president says he wants an agreement if he can get one for america. He had a phone call yesterday and sent out a tweet that we would Work Together. I had a conversation with my counterpart on the telephone the next day and a half and i expect osaka and i him in expect the president to have the meeting. Are talking and going to meet. Objective thate you and the other members have and that is if we can resolve the issues in a way that improves this relationship, preserves the at a disadvantage, we have an obligation to do that. South china comes back, you are ready to engage . So if china comes back, you are ready to engage . We are certainly willing to engage. Issue, you to the have negotiated one of the most farreaching chapters that includes a number of labor provisions for decades and never achieved. This agreement is transforming the labor environment in mexico. It is truly transformational. What is the most important part about enforcement that this committee needs to know where. Hina is doing what is mexico the most important issue here that shows mexico are taking them . And will enforce say first, we have to acknowledge the fact that what mexico did is historic. And there is a sense that this is a normal thing to do. Bold, strong, labor reform. What they precise agreed to do. It is the view of labor and certainly our view that they implemented those things. The question for us is to make sure they actually follow through. I think theres every expectation that they will, but some procedures will make sure that in the years ahead we continue to follow the rules because the Current Administration will not be there forever. Dispute state to state settlement and standards they must meet. Having a mechanism in place is a good idea and eager to sit down with members with how we do that. Let me recognize the gentleman from texas. Lets thank you and like thank you and i thank you thank you. [no audio] are very familiar with the issues i have raised with you over a year and a half. At the top of the list is ensuring that nothing in this agreement handcuffs or limits congress in any way from addressing the problem of prescription price gouging. I believe in what you have told me personally and what you said yesterday in the Senate Finance committee, you share the objective of ensuring the agreement does not limit the power of congress, but to address drug prices. Is that correct . I want to get it loud and clear. This is the first time i have testified before congress so i keep forgetting to turn among microphone. The answer is yes, i completely agree with that. It is very important that congress have what they want to isand i believe that something i can satisfy you and other members on. Indicated thato you want an agreement with reference to working conditions that are fully enforceable that you have made and it is more than just in name, but in practice. Is that correct . Yes. I tried to convince members this is an important part of the president s legacy and also an important part of my personal legacy. We have no interest at all doing something that we think is extremely important and transformative not just for mexico, but a huge effect on the United States and the last thing that either of us want is to yearshis disappear in six when we walk out the door. This to be something in perpetuity. , with regard to those issues concerning the environmental provisions and not wanting to see less protection that is afforded under the agreement, that was included with the these and, all of what a think other colleagues are seeking is truly enforceable provisions. Environmental enforcement like we had under the original nafta is not what we are looking for and reopening that aeement selfexecuting amendment signed by all three countries makes it clear this has the same status as the original agreement. And this echoes with the chairman has said about mexico. One of the strongest advocates i know of nafta from san antonio, a chamber leader, contacted me with a message, hold out until the administration commits no tariffs outside of the trade agreements. Usmca or nafta meaning nothing if we dont get an agreement. I know that what has been done , 25he administration percent tax on texans and americans generally is not necessarily a policy that you initiated, but it does undermine our attempt to reach an agreement on this. China, i know not within your direct way ibility, while huawei and millions imprisoned in china as indicated in a recent wall street journal study, those issues of forced lawr contrary to american is troubling and broader discussions that you are responsible for, they are issues that are raised with the chinese. We need a stable policy that considers all of these issues. Thank you. Congratulations ambassador, especially on the labor provisions. I think this is quite an accompaniment a congressman. An accomplishment. I have a question related to agriculture. In the new agreement, what can you say to those were concerned that the Enforcement Mechanisms are not going to be effective . Say we have the best agriculture we have ever negotiated. Members talk about it did ahe got asked, so we whole lot of fantastic stuff. Enforceables fully in the same way other things are. You have the normal state to state process. You have one where we can bring against canada or mexico if theres any violation, so it is fully enforceable. , theing from california number one agriculture state that a lot of people dont realize, but also a high tech theor, you negotiate premier hightech area in terms of agreements with protecting private property in technological patents. Do you want to talk any about that . What is new versus what we have seen before . Number one, there is no digital chapter in the current nafta. I remember those days better we did not have a clue about any of the stuff going on. I would say it is where theicans technology is in parade. He digital we think of that at as one side of the industry, but really something that goes across the entire economy. This is the most farreaching agreement. It has prohibitions on source code, algorithms, data flow provisions, electronic authorization provisions, access to public at a provisions. It has an enormous number which. Ad a pretty good chapter what everya, this is other trade agreement will be measured against. That andtulations on just to remind everyone, the time that nafta was first wasemented, the internet brandnew. I want to switch to china and you may find that china may be the only thing you get bipartisan agreement. None of us on the republican side like the tariffs, but we are well aware of the nationalistic or the threat that china poses to not only the united eight, but our allies and like you said, i just want to as it relates to how we are dealing with the administration dealing with make surei want to you dont get a deal with china just to get a deal. Like vietnam, other asian countries, especially you have been working on, i would like to see us focus on that and only theywith the chinese if are really going to stop their aggressive behavior. I really want to thank the members, republicans and democrats for their support for the president and for me. Winningerence between and losing is absolutely essential to the extent that it is viewed international and i think it says a