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#1 – A WILD 48 HOURS IN QUEBEC

#2 - TRUMP VS. TRUDEAU

• The G7 became something of a showdown between President Trump and Canadian Prime Minister Justin Trudeau. The President and his team took umbrage to Trudeau holding a press conference after agreement on the G7 communique in which he said that “Canada will not be pushed around” by the U.S. and reiterated that Canada would retaliate for steel and aluminum tariffs.

• Not only did the President refuse to sign the communique following Trudeau’s comments, the President’s advisors also did the Sunday show rounds to denounce the PM. Trade hawk Peter Navarro said on Fox News Sunday that “there's a special place in hell for any foreign leader that engages in bad-faith diplomacy with President Donald J. Trump and then tries to stab him in the back on the way out the door."

• Economic adviser Larry Kudlow did admit on CNN that much of the Trudeau talk was political posturing ahead of the Singapore Summit with North Korea, saying that “Kim must not see American weakness."

#3 – “TWO SUNSETS" & A "THREESOME" DEAL – TRUMP TALKS NAFTA AT G7

President Trump’s press conference following the G7 revealed more of his thinking about the NAFTA impasse, with particular emphasis on his desire to move forward with separate negotiations between Mexico and Canada. The President also stuck to his guns on including a sunset provision in the agreement while Canadian PM Justin Trudeau reiterated his stance that “there will not be a sunset clause. Canada has been unequivocal that we will not, cannot sign a trade deal that expires automatically every five years.”

Here are some of the President’s free-flowing thoughts on NAFTA at the press conference. A full transcript is HERE.

So two things can happen on NAFTA. We’ll either leave it the way it is, as a threesome deal with Canada and with the United States and Mexico, and change it very substantially — we’re talking about very big changes. Or we’re going to make a deal directly with Canada and directly with Mexico. Both of those things could happen.

If a deal isn’t made, that would be a very bad thing for Canada and it would be a very bad thing for Mexico. For the United States, frankly, it would be a good thing. But I’m not looking to do that. I’m not looking to play that game. So we’re either going to have NAFTA in a better negotiated form, or we’re going to have two deals.”

Re: the sunset clause: “It will have a sunset. You have the two sunsets. I mean, you have an ISDS provision and a sunset provision. They’ve been very heavily negotiated. You have two sunsets, two concepts of sunset. We’re pretty close on the sunset provision.

"Well, we have one that’s five years; you know it very well. You’ve studied this very well. Congratulations. That’s right. You have one group that likes to have five years, and then a renegotiation at the end of five years. And you have another group that wants longer because of the investments. But we’re pretty close.”

In other NAFTA news, Economic Advisor Larry Kudlow told CBS’s “Face the Nation” that the U.S. wont withdraw from NAFTA.

#4 - CORKER BILL TO CREATE CONGRESSIONAL REVIEW FOR 232 GAINS MOMENTUM

• On Wednesday, Senator Bob Corker (R-Tenn) introduced a bipartisan bill that would require the President to get Congressional approval for Section 232 trade actions. According to Corker’s office the bill would create a “60-day period following submission” during which “legislation to approve the proposal will qualify for expedited consideration, guaranteeing the opportunity for debate and a vote. The requirement would apply to all Section 232 actions moving forward, as well as those taken within the past two years.”

• Corker’s plan to press ahead with the bill, and to submit it as an amendment to the Defense Authorization bill on the Senate floor, drew an angry call from President Trump. In what Corker described as a “lengthy” call, Trump apparently told Corker to back off his effort.

• Introduction of the bill was initially met with the cold shoulder by Congressional leadership with Paul Ryan, Mitch McConnell, and others pointing out that the bill would need a veto-proof majority and rehashing lines from previous efforts to check the President’s authority.

BUT…the bill is gaining momentum among the business community and could, according to Senate Democratic Leader Chuck Schumer, gain support among Senate Democrats.

• Read more HERE from Corker’s office on support the bill has received among the business community.

#5 - ZTE DEAL REACHED & BIPARTISAN EFFORT LAUNCHED TO BLOCK IT

On Thursday, the Commerce Department announced they had reached a deal on the Chinese phone maker ZTE that would reverse the Department’s decision to ban U.S. companies from doing business with ZTE for up to seven years. An agreement on ZTE has been seen as a necessary precursor for making progress on U.S.-China trade negotiations.

Here are the details of the agreement:

o A $1 billion fine for ZTE, plus an additional $400 million in escrow.

o Requires ZTE to change its management and board with 30 days, and to establish a compliance team chosen by the U.S which will be embedded inside the company at ZTE's expense.

o The deal also includes a new 10-year ban that is suspended unless there are future violations.

• Commerce Secretary Wilbur Ross’s take: "We are literally embedding a compliance department of our choosing into the company to monitor it going forward. They will pay for those people, but the people will report to the new chairman.”

• The deal drew not only bipartisan condemnation but also a bipartisan bill to block the deal co-sponsored by Senate Democratic Leader Chuck Schumer, Senator Chris Van Hollen, and Republican Senator Tom Cotton. The bill was introduced as an amendment to the Defense Authorization bill currently on the floor of the Senate. It is unclear whether the amendment will get accepted to the final version of the bill that could be voted on as soon as this week.

• Senator Marco Rubio said that ZTE has “direct links to the Chinese government and Communist Party. Their products and services are used for espionage and intellectual property theft, and they have been putting the American people and economy at risk without consequence for far too long."

Prepared by Matt McAlvanah (matt@monumentpolicy.com) and the Monument Trade Team

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