April 23, 2020 / 1:00 AM / a month ago

Former W.House adviser warns against 'Buy America' order for medical equipment

WASHINGTON, April 22 (Reuters) - A former senior trade adviser to President Donald Trump on Wednesday cautioned against hasty adoption of “Buy America” mandates to the medical equipment and pharmaceutical sectors in the middle of the coronavirus pandemic.

Kelly Ann Shaw, who served as deputy director of the National Economic Council and was the lead U.S. negotiator with the Group of Seven and Group of 20 countries, told Reuters that supply-chain vulnerabilities in the medical realm should be studied, but now is not the time.

“Supply-chain issues certainly will have to be looked at, but rushing to make major changes to our supply chains in the middle of a pandemic is hasty and will lead to bad policy,” said Shaw, who joined the Hogan Lovells law firm in mid-April.

White House trade adviser Peter Navarro, a long-time trade hawk who crafted an executive order on the issue, last month predicted Trump would sign the measure shortly. The plans drew sharp criticism from a wide array of companies, trade groups and lawmakers, and the order has since been revised but not yet signed.

The U.S. Chamber of Commerce and dozens of other business and trade groups urged officials to drop plans for the order, arguing it would damage U.S. trading relationships for years to come and could worsen shortages of medicines and medical equipment needed to treat COVID-19.

Shaw said she expected Trump to be “thoughtful in addressing this issue too, when the time is right.”

To ease costs for U.S. taxpayers, Shaw also urged the administration to temporarily waive tariffs on Chinese-made face masks and other medical supplies, joining a growing chorus of U.S. lawmakers and others urging similar action.

“It doesn’t make any sense that we would be inflating the price of those products with duties when we need them to contain the outbreak,” she said, noting the U.S. government was spending huge sums of taxpayer money to buy life-saving equipment and refill the Strategic National Stockpile.

A report by the Peterson Institute for International Economics found that a standard disposable N-95 mask carries a 7% U.S. tariff, while other medical headwear can face duties of between 6.4% and 8.3%.

Shaw said a move by the U.S. Trade Representative’s office allowing firms to request waivers from tariffs on such goods was too cumbersome, and an immediate, temporary waiver on all needed medical supplies should be granted. “We need relief now,” she said. (Reporting by Andrea Shalal; Editing by Leslie Adler)

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