President Trump Issues “America First” Trade Policy

On January 20, President Trump issued a Presidential Memorandum titled the “America First Trade Policy” (“the Memorandum”), which mandates a sweeping review of current US trade and economic policies. Notably, not among this plan is the immediate imposition of new tariffs. Instead, the memorandum focuses on establishing a “robust and reinvigorated trade policy that promotes investment and productivity” while benefiting “American workers, manufacturers, farmers, ranchers, entrepreneurs, and businesses.”

The Memorandum also directs several agencies to investigate and make recommendations relating to trade deficits, unfair trade practices, and creating an External Revenue Service; and to review existing US trade agreements, the de minimis exemption, and export controls. The outcomes and recommendations are generally due to President Trump by April 1, 2025. We have summarized these actions below.

Federal Agency Investigations

The Memorandum directs several federal agencies¹ to conduct investigations and recommend remedies to address several issues of “unfair and unbalanced trade.” Issues identified by the Memorandum include:

• The “large and persistent annual trade deficit in goods, as well as the economic and national security implications and risks resulting from such deficits”
• The establishment of and best methods for creating an External Revenue Service to collect tariffs, duties, and other foreign-trade related revenues
• Unfair trade practices and corresponding remedies under applicable authorities The policies and practices of “major” US trading partners with respect to the rate of exchange between their currencies and the US dollar, including “appropriate measures to counter currency manipulation or misalignment” as well as the identification of countries that are “currency manipulators”
• Whether any existing US trade and sectoral trade agreements need revisions “necessary or appropriate to achieve or maintain the general level of reciprocal and mutually advantageous concessions”
• Whether there are countries with which the United States can negotiate agreements to gain export market access for “American workers, farmers, ranchers, service providers, and other businesses”
• “The application of antidumping and countervailing duty (AD/CVD) laws, including with regard to transnational subsidies, cost adjustments, affiliations, and ‘zeroing’”
• Whether existing AD/CVD investigations and administrative reviews are sufficient to “induce compliance by foreign respondents and governments involved in AD/CVD proceedings”
• The loss of tariff revenues and risks relating to the importation of counterfeit products and contraband products under the de minimis exemption
• Whether any foreign country subjects US persons to discriminatory extraterritorial taxes
• The impact of all trade agreements to ensure their implementation “favors domestic workers and manufacturers, not foreign nations”
• How to modify the US export control system in order to “maintain, obtain, and enhance” the US “technological edge,” to “identify and eliminate loopholes in existing export controls” and to “use enforcement policies and practices” to “incentivize compliance by foreign countries”
• Define any appropriate actions with respect to existing controls by the Office of Information and Communication Technology and Services (ICTS) on connected vehicles and whether controls on ICTS transactions should be expanded to account for additional connected products  
• Whether Treasury’s final rule to regulate outbound investments includes “sufficient controls to address national security threats” and whether Executive Order 14105, Addressing United States Investments in Certain National Security Technologies and Products in Countries, should be modified, rescinded or replaced
• Whether any foreign governments provided financial contributions—for example, subsidies—to assist foreign bidders on US federal procurement programs

The Memorandum also addresses several country-specific issues, detailed below.

China

The Memorandum instructs USTR to review the Phase One Trade Agreement between the United States and the People’s Republic of China (PRC),² signed on January 15, 2020, to determine whether enforcement or changes to the agreement are required.

The USTR must also review its recent report, “Four-Year Review of Actions Taken in the Section 301 Investigation: China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation,” to determine “additional tariff modifications as needed,” especially for “industrial supply chains and circumvention through third countries.”

The Memorandum requires the Secretary of Commerce and USTR to assess legislative proposals regarding US permanent normal trade relations with the PRC, likely similar to the Restoring Trade Fairness Act. The Secretary of Commerce must also assess the status of intellectual property rights conferred on PRC persons, and, with the Secretary of Homeland Security, assess the unlawful migration and fentanyl flows from Canada, Mexico, PRC, and other jurisdictions.

Mexico and Canada

The Memorandum directs USTR to begin consultations relating to the United States-Mexico-Canada Agreement (USMCA), entered into force under President Trump’s first administration on July 1, 2020, in preparation for the USMCA’s joint review, which will occur on July 1, 2026. The USTR is also charged with “assessing the impact of the USMCA on American workers, farmers, ranchers, service providers, and other businesses” and to make recommendations regarding US participation in the agreement.

Section 232 Tariffs

In his first term, President Trump imposed tariffs on steel and aluminum imports using Section 232 of the Trade Expansion Act of 1962, which were continued under the Biden administration. The Memorandum now requires the Assistant to the President for Economic Policy—in consultation with the Secretary of Commerce, USTR, and the Senior Counselor for Trade and Manufacturing—to review the effectiveness of these measures on steel and aluminum in responding to threats to US national security.

Additional Economic Security Measures

Finally, the Memorandum requires the Secretary of Commerce, in consultation with the Secretary of Defense and other relevant agencies, to conduct “a full economic and security review” of the US industrial and manufacturing base to determine “whether it is necessary to initiate investigations to adjust imports that threaten the national security of the United States.”

Conclusion

 The America First Trade Policy lays out a sweeping plan to address several matters relating to US trade policy. In response, agencies have announced plans to implement the Memorandum—e.g., on Friday, January 24, USTR announced a review of unfair foreign trade practices and a compliance review of the Phase 1 Agreement with China. 

Moreover, while the Memorandum does not immediately impose tariffs relating to these matters, President Trump publicly discussed imposing 25% tariffs on Mexico and Canada by February 1, 2025, during his first Oval Office commentary following his inauguration.

As noted previously, the results and recommendations of the reviews and investigations outlined above are due to President Trump by April 1, 2025, (except for the report by the OMB Director on foreign subsidies and US procurement, which is due April 30, 2025). Accordingly, interested parties should continue to monitor US trade policy as it continues to evolve under the second Trump Administration. 

¹ This includes the Department of the Treasury, the Department of State, the Department of Commerce, the Department of Defense, the Department of Homeland Security, the Director of the Office of Management and Budget (OMB), the United States Trade Representative (USTR), the Assistant to the President for Economic Policy, and the Senior Counsel for Trade and Manufacturing.

² Formally titled the “Economic and Trade Agreement Between the Government of the United States of America and the Government of the PRC.”