According to Chet Thompson, president and CEO of AFPM, petrochemical leaders "have a lot to be excited about" in terms of what's happening for their industry in Washington, D.C., adding they "certainly support the Trump administration on a lot of things."
"When he was elected, his policies, frankly, on energy were like someone stepping off our chest, and he's done a lot of good things," Thompson said, lauding President Trump for reducing regulatory and legislative obstacles. "None of it should be taken for granted."
Thompson noted, however, AFPM is "really outspoken in Washington about our fears and concerns on the trade front."
What AFPM doesn't support, however, Thompson said, are "these trade battles, particularly with the tariff war with China. That has had enormous ramifications for industry on the Gulf Coast."
Thompson said he finds it interesting most of industry "is united around this" and believes this issue with China needs to be resolved.
"But the president has remained consistent on this issue," Thompson said in a panel discussion at the Gulf Coast Industry Forum held recently in Pasadena, Texas. "He's not consistent on everything every day, but as far as it relates to China, he's been more consistent."
Thompson said he believes the tariff war with China is one of the things the president has under control.
"He controls his own fate here, and I believe that sometime between now and when we get into the full election cycle, he will solve this issue," Thompson said. "He can solve this issue. He knows the importance of it. I certainly don't think he wants to solve it prematurely.
"I'm not necessarily part of the majority opinion on this, but I cannot see the president going into next year's election year with China looming large like this."
USMCA and NAFTA 2.0
Expanding his discussion of trade issues, Thompson stressed the USMCA (United States-Mexico-Canada Agreement) and NAFTA 2.0 (North American Free Trade Agreement) are critically important to the U.S. refining and petrochemical industries.
"Forty percent of all the crude we, as the refining sector, import comes from Canada," Thompson said. "And somewhere between 20 and 25 percent of the refined products we make go to Mexico. We need free and open borders between Canada, the U.S. and Mexico."
Despite the "big political fight" taking place in Washington, Thompson said he believes the president is trying to work with Speaker of the House Nancy Pelosi "because she controls whether or not the issue goes to the House floor for a vote."
Thompson said his instinct is that the trade votes will take place and the USMCA will pass.
"The fear we have is that, if it doesn't go the president's way, does he threaten pulling out of NAFTA without having a USMCA deal to take its place?" Thompson speculated. "That wouldn't be good for anybody."
Co-panelist Bryan Zumwalt, former vice president of federal affairs for the American Chemistry Council who was recently named executive vice president of public affairs of the Grocery Manufacturers Association, said he agrees there are "big concerns" with China tariffs.
"There's a sense that the president has dug in. Who can blink first? Is it going to be a protracted battle with China, and will the trade agreements get done? It's very interesting, and there are some additional political dynamics playing out there."
Panel moderator Hector Rivero, president of the Texas Chemical Council, said he agrees President Trump has recently been "very determined" to get some balance in trade, which will continue to impact the industry going forward.
