As the U.S. Trade Representative (USTR) conducts its Section 301 investigation on Vietnam’s currency valuation, USCIB Senior Director for Trade, Investment and Financial Services Eva Hampl testified before USTR at a public hearing on December 29, warning USTR that tariffs on Vietnamese goods would be detrimental to both American companies and consumers.

“Putting in place trade penalties, such as additional tariffs against Vietnam, would further work against the supply chain and national security interests of the United States,” said Hampl. “At a time when policymakers, companies, and non-government stakeholders have coalesced around the need for trustworthy and resilient supply chains, Vietnam is strongly positioned to play a leading role in that ecosystem. It is an increasingly important security partner of the United States and possesses strong capabilities in technology manufacturing. Vietnam’s presence in supply chains can serve as a complement to manufacturing in other trustworthy locations in Asia and other regions, including the United States.”

Other agencies represented on the panel included the U.S. Departments of Commerce/International Trade Administration, State, Treasury, Agriculture, and the Small Business Administration (SBA). Hampl received several follow-up questions to her testimony from State Department Foreign Service Officer Carter Wilbur.

According to Hampl, the majority of the witnesses pushed back against the use of tariffs in their comments to address any issues related to currency valuation. In a report released just a week before the hearing, Treasury labeled Vietnam as a currency manipulator. Most of the witnesses during the hearing indicated that whether or not this may be true, tariffs are not the appropriate vehicle to address this issue. Moreover, there should be deference to the Treasury process in resolving any currency related concerns.

USCIB hosted a briefing with the U.S. negotiating team on Investor-State Dispute Settlement (ISDS) Reform at the UN Commission on International Trade Law (UNCITRAL) on December 16. UNCITRAL’s Working Group III focuses on the issue at UNCITRAL and held its thirty-ninth session in early October. Members had the opportunity to discuss current developments with Karin Kizer, attorney-advisor in the Office of Private International Law in the Office of the Legal Adviser of the Department of State, and lead negotiator on ISDS Reform at UNCITRAL. She was also joined by Khalil Gharbieh, director for Investment at the Office of the U.S. Trade Representative (USTR), as well as colleagues from the State Department.

“Investment protections are more important than ever, with global Foreign Direct Investment (FDI) having dropped dramatically due to the current crisis,” said USCIB Senior Director for Trade, Investment and Financial Servcies Eva Hampl. “Increasing investment flows should be a priority for countries as they look to recover from the pandemic. Mechanisms like ISDS are critical in ensuring that investors have adequate recourse as they invest in foreign markets, and are a factor as decisions are made where to invest.”

According to Hampl, the discussions at UNCITRAL are driven by the European Union’s proposal for a multilateral investment court, a proposal that reared its head during the negotiations of a Transatlantic Trade and Investment Partnership (TTIP). USCIB, having official observer status at UNCITRAL, has been an active participant in the meetings of the working group, most recently at the meetings in October.

Subsequent to the meetings, USCIB together with the Corporate Counsel International Arbitration Group (CCIAG) submitted comments on Appointment of Arbitrators, Appellate Mechanism, and Enforcement.

The next session is scheduled to take place February 8-12, 2021 in Vienna.