Nera Agreement

There are few alternatives to aluminum for which consumption has increased in the national economy16.16 The price elasticity of aluminum demand should therefore be very low (very little elasticity, absolute value much less than one). The International Trade Commission also concluded that U.S. demand for downstream aluminum products, such as aluminum extrusions, was highly inelastic and that there were limited substitutes for these downstream products17 increases in import prices or aluminum costs in general are likely to be absorbed or passed on by downstream consumers (for example. B other manufacturing companies) that have little or no impact on final demand. Thus, even a 30% tariff should not have an impact on real output or employment in the national economy. The distorted results of the NERA study reflect the inappropriate use of the REMI model to assess the impact of the proposed corrective measures in this case. As the authors of the NERA study found, the “core of the REMI model is a series of input/out-to-exit relationships between different sectors.10 E/E models are based on the assumption that inputs and outputs in fixed percentages vary from sector to sector. Therefore, while aluminum consumption decreases by 5%, consumption of automobiles, reductions and medical and public services decreases by 5%. It is clear that this simplistic assumption does not in any way describe how trade policy has an impact on the domestic economy. The USITC uses a “dynamic and predictable global equilibrium model” (CGE) to assess the impact of trade policy on the economy11. The analysis of the proposed changes to the aluminum exchange policy should be examined in more detail using a CGE model. The EMB`s formal analysis goes beyond these comments.

However, some general observations are possible. Simplified Residency Agreement Process and Compliance Management But the NERA model predicts that a 30% tariff would reduce production by $8.93 billion in other manufacturing industries and $15.7 billion in all other sectors. 18 for a total decline in gross production (excluding aluminum profits) in the rest of the economy of $24.63 billion19, more than six times more than the initial impact on gross production of $3.87 billion. A more realistic model (CGE type) with reasonable assumptions would have a much smaller impact on employment and production. Small sector tariffs of this type should be absorbed without affecting actual production. For example, between 2007 and 2016, world aluminum prices for the LME fell by 39%, No apparent impact on the prices (average unit values) of imported beverages in aluminum cans, which increased by almost 7% over the same period, as my written comments on the survey 232.20 In addition, have found. the USITC study on the economic impact of the proposed Trans-Pacific Partnership (TPP) agreement estimated that this agreement, which has virtually all tariffs on trade between the United States and five countries (Brunei, Japan, THE NERA study estimates that a tariff rate of 3 0% on aluminium products and the creation of 128,200 jobs would be 128,200 jobs. which represent less than 0.7% of total imports of manufactured goods in 20157 would have an impact on the economy in terms of absolute impacts. , such as the entire TPP agreement.