USTR releases trade barriers report ahead of Trump's reciprocal tariffs

By David Lawder

WASHINGTON (Reuters) - U.S. President Donald Trump's administration released an encyclopedic list of foreign countries' policies and regulations it regards as trade barriers on Monday, two days before he proposed hitting global trading partners with reciprocal tariffs.

The Office of the U.S. Trade Representative's annual National Trade Estimate Report on foreign trade barriers lists average applied tariff rates for trading partner countries and non-tariff barriers ranging from onerous food safety regulations to renewable energy requirements and public procurement rules.

Trump's reciprocal tariffs, expected to be announced on Wednesday, aim to match other countries' higher tariff rates for specific goods and compensate for non-tariff barriers that put U.S. exports at a disadvantage.

Last week, Trump announced 25% tariffs on U.S. auto imports in a move aimed at rebuilding U.S. production but which threaten new price shocks.

"No American President in modern history has recognized the wide-ranging and harmful foreign trade barriers American exporters face more than President Trump," U.S. Trade Representative Jamieson Greer said in a statement.

"Under his leadership, this administration is working diligently to address these unfair and non-reciprocal practices, helping restore fairness and put hardworking American businesses and workers first in the global market," Greer added.

It is unclear how the 397-page report will impact Trump's reciprocal tariff plans.

White House trade adviser Peter Navarro has frequently complained that value-added taxes collected by European Union countries act as an additional tariff and an export subsidy when refunded for autos exported to the U.S.

But the USTR report did not specify VATs as trade barriers in its discussion of EU policies, focusing instead on digital services taxes and the bloc's new carbon border adjustment mechanism.

It did list VATs and their implementation as burdensome to U.S. imports in some other countries, including Argentina, Mexico and the United Arab Emirates. The report said China's use of VAT rebates to encourage exports of certain products acted as a kind of subsidy.

FOOD REGULATIONS

Many of the listed trade barriers are technical in nature or the result of government regulation that blocks some U.S. exports, such as delays in EU approvals for genetically modified crops or bans on agricultural imports containing residues of certain types of pesticides.

The report flagged a new EU requirement for a minimum amount of post-consumer recycled content in plastic packaging as potentially creating "unjustified barriers to U.S. exports," saying the U.S. would work with the EU on the rule's implementation.

The report also highlighted longstanding sources of trade disputes, such as Canada's "supply management" system for its dairy, poultry and egg industries, which use production limits on import quotas and high tariffs, with out-of-quota tariffs on cheese at 245% and butter at 298%.

Trump has complained about Canada's high dairy tariffs, saying that "they'll be met with the exact same tariffs, unless they drop it."

(Reporting by David Lawder; Editing by Richard Chang)