The shutdown of many U.S. government services because of the budget impasse in Congress is beginning to be felt in the trade sector.
The United States will not send a delegation this week to Brussels for the planned second round of negotiations with the European Union on a transatlantic trade agreement because of furloughs in the Office of the Trade Representative.
The two sides will try to reschedule talks as soon as funding of the U.S. government is restored, officials said. A deal could lower non-tariff trade barriers and spark hundreds of millions of dollars in additional bilateral trade between the world's largest trading partners.
On Friday, U.S. Customs and Border Protection confirmed it would delay the Oct. 5 deployment of its next mini-package of software functions for the Automated Commercial Environment
, a multi-billion-dollar replacement of legacy systems for processing imports and exports with enhanced capabilities for transmission of paperless documents, analytics, and interfacing with other government agencies. Deployment A, as its called, builds on existing functions for filing entry summaries. It includes functions associated with filing simplified entries prior to cargo arrival at a port of entry, entry summary validations (automated prompts to make sure fields are properly filled in) for harbor maintenance fee and tariff classification and submitting trade data to other agencies through ACE.
There is no end in sight to the disagreement in Washington over spending policies and the temporary funding measure is now expected to be rolled into the debate about whether to raise the national debt ceiling, which is necessary to borrow more money to pay for bills already incurred. The government is projected to run out of money by Oct. 17 without more borrowing authority.
The lack of progress could jeopardize CBP's annual Trade Symposium, scheduled for Oct. 24-25 in Washington. Even if a budget deal is agreed on before then, it is possible the event could be cancelled because organizers wouldn't have enough time after returning from furlough to finalize all arrangements or to allow registrants time to cancel their trips.
Customs officers are exempt from the furloughs and continue to work and ports of entry clearing cargo and passengers, but delays are possible for cargo requiring release decisions from other agencies with jurisdiction over imports for safety or environmental reasons.
At last week's meeting of the Port of Los Angeles' Harbor Commission, Executive Director Geraldine Knatz said marine terminals were not experiencing any operational problems because Customs and the Coast Guard are operating as normal. But, she warned, the port could be subject to delays in reimbursements from its federal grants if the shutdown extends for several weeks. A class at the Maritime Law Enforcement Training Center has already been rescheduled and several meetings involving federal representatives have been canceled, she added.
Meanwhile, economists are in the dark about the employment rate for September because the Department of Labor failed to release monthly statistics on job growth.