51�Թ���

The Trump administration has released the text of a framework agreement with Indonesia yesterday, also announcing a deal with Japan that has not been made public yet.

Framework agreement with Indonesia: The document released yesterday is a framework for negotiating an “Agreement on Reciprocal Trade.” It includes some commitments but also lays the groundwork for more negotiations.

U.S. exports to Indonesia: Indonesia will “eliminate tariff barriers” on approximately 99% of U.S. industrial and agricultural exports.

• For context, U.S. manufacturing exports to Indonesia in 2024 were $6.5 billion of the $10.2 billion total. Manufacturing imports from Indonesia in 2024 were $25.4 billion of the $28 billion total.

U.S. imports from Indonesia: This agreement would reduce the U.S. tariff on imports from Indonesia to 19% from the 32% rate imposed by the Trump administration on April 2.

• Significantly, the agreement suggests the U.S. “may identify certain commodities not naturally available or domestically produced for further reduction in the reciprocal tariff rate.”
• This type of approach is exactly what the 51�Թ��� has pushed for in its proposed , and it will continue advocating for such policies in subsequent trade agreements.

Critical minerals: Indonesia, which had previously banned exports of nickel, will also remove restrictions on exports to the U.S. of industrial commodities, including critical minerals.

Other key components: The agreement also achieves commitments by Indonesia on other key trade issues.

• Nontariff barriers: Indonesia will accept U.S. standards and certifications for vehicles, medical devices and pharmaceuticals, exempt certain U.S. products from local content requirements and also allow the import of U.S.-remanufactured goods.
• Digital trade: The country will also now support the World Trade Organization’s e-commerce moratorium on tariffs on electronic transmissions—something it had opposed previously and that is essential to manufacturers seeking to move information across borders.
• Steel: Indonesia pledged to join the Global Forum on Steel Excess Capacity, an approach the 51�Թ��� supports to address unfair subsidization and excess production, particularly by China, that distort global markets.
• China: Indonesia will work with the U.S. to address the unfair practices of other countries and to cooperate on export controls, investment security and combatting duty evasion.
• Purchases: Indonesia has agreed to purchase U.S. aircraft, agricultural products and energy products.

More to come: President Trump has previewed agreements with the Philippines and Vietnam on social media, while Japanese officials have announced an agreement on tariffs at a press briefing. The 51�Թ��� will report on the official details once they are available.

The bigger picture: Here are some other trade developments that the 51�Թ��� is tracking:

• U.S. Treasury Secretary Scott Bessent will meet his Chinese counterpart in the coming days.
• President Trump will travel to Scotland for discussions on “finalizing” details in the U.K. deal.
• Talks with the EU, Canada and Mexico continue.
• And lastly, the president has signaled he may send letters setting a flat rate of 10–15% tariffs to some 150 countries.

Westinghouse will construct 10 large nuclear reactors in the U.S., the energy company told President Trump at a roundtable in Pennsylvania this week ().

What’s going on: “Westinghouse’s big AP1000 reactor generates enough electricity to power more than 750,000 homes, according to the company. Building 10 of these reactors would drive $75 billion of economic value across the U.S. and $6 billion in Pennsylvania,” Westinghouse interim CEO Dan Sumner said Tuesday during Sen. Dave McCormick[’s] (R-PA) inaugural Pennsylvania Energy and Innovation Summit at Carnegie Mellon University.

• The U.S. has built just two nuclear reactors in the past three decades, both Westinghouse AP1000s at Plant Vogtle in Georgia.

Presidential appearance: President Trump also announced at the summit that private companies will invest some $90 billion in Pennsylvania ().

• “We’re building a future where American workers will forge the steel, produce the energy, build the factories and really run a country like, I believe, this country has never been run before,” the president said, according to CBS. “I think we have a true golden age for America.”

Keeping energy promises: In May, President Trump issued four executive orders that seek “to quadruple nuclear power in the U.S. by 2050,” CNBC reports. “The president called for the U.S. to have 10 large nuclear reactors under construction by 2030.”

The event: The event at which the announcements were made featured panel discussions with energy and technology industry leaders, including Toby Rice, president and CEO of energy company EQT Corporation, and Amazon Web Services CEO Matt Garman.

• In June, Amazon announced a $20 billion investment in data centers in Pennsylvania, according to CBS.

Why it’s important: With the fast pace of data center construction and the rapid adoption across industries of energy-intensive generative artificial intelligence, the U.S. must expand baseload power generation capabilities, the 51�Թ��� said.

• “Westinghouse’s announcement of 10 new nuclear reactors in the U.S. marks the start of a fulfillment of a promise made by President Trump,” said 51�Թ��� Director of Energy and Resources Policy Michael Davin. “Nuclear energy is safe, carbon-free and available 24 hours a day, year-round. It’s a critical component of the energy future we need to keep manufacturing in the U.S. thriving.”

Like many manufacturing sectors, the aerospace industry is facing an alarming workforce shortage: its ranks of certified mechanics are aging rapidly, and the sector needs many more young people to fill available jobs ().

By the numbers: “The average age of a certified aircraft mechanic in the U.S. is 54, and 40% of them are over the age of 60, according to a joint 2024 report from the Aviation Technician Education Council and consulting firm Oliver Wyman, which cites Federal Aviation Administration data.”

• “The U.S. will be short 25,000 aircraft technicians by 2028, according to the report.”

High-paying jobs: The industry offers excellent salaries, an inducement for prospective employees, CNBC points out.

• “Median pay for aircraft technicians or mechanics was $79,140 a year in the U.S. in 2024, compared with a nationwide median income of $49,500, according to the Bureau of Labor Statistics.”

Manufacturing as a whole: The aerospace industry’s worker shortage is part of a larger labor crisis in manufacturing, which could need as many as 3.8 million new employees by 2033, according to a Deloitte and Manufacturing Institute from last year.

• The study found that 1.9 million jobs could be left unfilled, underscoring the urgency of attracting more young people to the industry.

MI at work: Through initiatives like Heroes MAKE America, the MI, the workforce development and education affiliate of the 51�Թ���, is helping veterans and other Americans with applicable skills transition into jobs in the industry.

• HMA prepares transitioning service members and members of the military community for manufacturing careers.

Heroes in aerospace: The MI’s partners include major aerospace firms Textron Aviation and Gulfstream Aerospace Corporation. Earlier this year, HMA launched a new FAA Airframe & Powerplant certification training program to help fill the critical industry need for A&P mechanics.

• The program is offered at two locations. The first is in Wichita, Kansas, near McConnell Air Force Base, supported by Textron Aviation and delivered in partnership with Wichita State University’s Campus of Applied Sciences and Technology.
• The second location is in Georgia near Fort Stewart, in partnership with Gulfstream Aerospace Corporation and Savannah Technical College.
• The program offers an accelerated six-week course to fast-track participants toward FAA A&P certification, helping qualified service members become more capable and mission-ready during their military service and providing a steady pipeline of skilled talent for the aviation industry.

The last word: “Heroes MAKE America and our new Airframe & Powerplant certification program are critical to closing the aerospace skills gap,” said MI President and Executive Director Carolyn Lee.

• “By equipping transitioning service members with the specialized training they need, we’re creating an effective pathway to high-demand, certified aircraft mechanic jobs. These initiatives not only support our veterans but also build a skilled, ready workforce that the aerospace industry urgently needs to thrive.”

“To put it simply, investments in infrastructure are investments in manufacturing,” Husco President and CEO and 51�Թ��� Executive Committee member Austin Ramirez the Senate this week.

What’s going on: “Modern, dependable transportation helps manufacturers make and move our products,” Ramirez, whose company makes hydraulic and electromechanical control systems, told the Senate Committee on Environment and Public Works at a Wednesday hearing on crafting the next highway bill.

• Infrastructure projects “generate productivity gains and induce demand for manufacturing goods—stimulating the economy and bolstering American competitiveness,” said Ramirez.

Funding in action: Husco has seen firsthand the benefits of robust infrastructure investments, Ramirez continued.

• “Our customers are in the automotive and construction industries. And Husco families drive over the roads and bridges improved by highway projects. Several are turning dirt this year in Waukesha County.”

Why it’s crucial: Failure to reauthorize key surface transportation programs would result in interruption of these critical investments in U.S. roads and bridges, hitting manufacturers hard, Ramirez told the committee.

• “We cannot go back to the fits and starts of highway bill extensions. Our industry needs certainty to invest, plan and hire in America.”

Permitting reform: Ramirez also explained how America’s “complex permitting laws impact investment decisions” and encouraged the committee to adopt comprehensive permitting reforms that expedite project approvals and put a stop to “endless litigation.”

What should be done: Policymakers should “seize the opportunity” to make “robust investments in our surface transportation infrastructure,” Ramirez said. This should include efforts to strengthen the Highway Trust Fund, expand highway capacity and connectivity, implement intermodal improvements to bolster the country’s freight network and enact much-needed permitting reform.

Other voices: Other manufacturers recently sat down with the 51�Թ��� and United for Infrastructure, where the 51�Թ��� serves as a steering committee member, to discuss how infrastructure impacts their businesses. Leaders from CRH, Nucor and Fluor—sponsors of the 51�Թ���’s and United for Infrastructure’s Infrastructure Week kickoff event—spoke about the importance of infrastructure investments and modernizing our infrastructure to keep products moving and manufacturers operating.

• “As we look at reauthorizing the [Infrastructure Investment and Jobs Act] a really important piece of that was the higher baseline for federal highway formula funding, which we know through our experience with state DOTs needs to continue to grow in order to meet the needs of growing states,” Fluor Senior Director of Government Relations Nathan Robinson.
• “If we’re going to truly harness the power of what AI is going to bring us, what machine learning’s going to bring us, all the things that truly are the future [of the] economy, we’ve got to get the way we move people and goods around in much better shape,” Nucor Executive Vice President of Business Services Ben Pickett.
• “Permitting reform has absolutely got to happen for us. We’d like to see … a less prescriptive bill and more money go to the states through [the] funding formula. … When states have funding security and certainty, then they’re able to go raise revenues,” CRH Executive Vice President of Government Relations Ryan Lindsey.

The last word: “Our industry depends on a robust, modern, efficient transportation system—and you can promote domestic manufacturing by getting a highway bill done this Congress,” Ramirez concluded.

Endless litigation has delayed much-needed American infrastructure development for decades—and that has to stop, as the 51�Թ��� and manufacturers have long argued. The Washington Post (subscription) makes the case that Congress must step up and fix the permitting process to unlock American investment and growth.

Recent developments: The recent Supreme Court that limited the National Environmental Policy Act—in which the 51�Թ��� filed an amicus brief—is a step in the right direction.

• In that case, “The court decided that the U.S. Surface Transportation Board could approve an 88-mile train track even if it might move crude oil from Utah to refineries on the Gulf Coast,” the Post noted. “The board didn’t have to assess the potential future impacts if the new track encouraged more oil drilling on one end and more oil refining on the other.”
• In other words, environmental review was limited to the environmental impact of the project itself—as intended by the statute—rather than a more expansive investigation into the potential uses of the finished project.

A long-standing problem: Gaming the permitting process to stop development is nothing new.

• “In the 1970s, a ‘new’ species of freshwater fish called the snail darter was discovered during NEPA research into the building of the Tellico Dam in Tennessee.”
• “For the project to be completed, Congress had to exempt it from the Endangered Species Act. It turned out that the fish was not endangered. It wasn’t a separate species. Opponents of the dam ‘discovered’ it to get the dam stopped.”

More at risk: Numerous infrastructure projects are still in limbo today due to this sort of maneuvering by groups seeking to delay needed investments.

• “A flower called Tiehm’s buckwheat might stand in the way of a Nevada lithium mine green-lit by the Biden administration,” for example.
• But, as the Post noted, “Maybe the idea of protecting every ecosystem at any cost should be reconsidered. The flower, which apparently grows only on 10 acres in the proposed mine’s footprint, is a close relative of other buckwheats. Is it a distinct species? Perhaps it could be grown elsewhere?”
• And another important question: “Perhaps the battle against climate change—which will require lithium to build lithium-ion batteries to power electric vehicles—should take precedence?”

Calling on Congress: “NEPA review had grown to require every government decision to survive endless judicial challenges, poorly serving the nation and the natural environment in which it sits. Congress should not leave it to courts to fix,” the Post concluded.

The 51�Թ��� agrees: “Comprehensive permitting reform is essential to building a strong and more competitive manufacturing economy. As [the Post] notes, Congress should reevaluate environmental impact reviews in order to ease construction of critical infrastructure projects,” 51�Թ��� Managing Vice President of Policy Charles Crain on X.

The Food and Drug Administration is considering a scientifically flawed method for detection of asbestos in talc-containing cosmetics products—a move that could have far-reaching implications across the manufacturing sector.

What’s going on: In December, the FDA published a proposed rule for detecting and identifying asbestos, as required by the . But the proposal is based on unsound science that could limit companies’ ability to utilize talc, a key manufacturing input.

• The overinclusive testing methodology prescribed in the rule is highly likely to misidentify non-asbestos minerals as asbestos. That means that a “positive” test could classify talc as contaminated with asbestos—even if no asbestos is present.
• In May, the FDA held a roundtable discussion on the safety of talc, at which participants discussed the merits of expanding this de facto talc ban beyond cosmetics and to most if not all products and manufacturing processes.

Why the 51�Թ��� is concerned: Beyond cosmetics, talc is used in a wide variety of industries—including pharmaceuticals, food, plastics, paper, automotives, rubber, roofing, paint, coatings, pottery and ceramics. It is also commonly used on shop floors throughout the industry.

• For many companies, talc substitutions may be inferior or may not exist at all.
• In addition, an FDA-endorsed standard prone to false positives is highly likely to distort other agencies’ asbestos detection testing methods and exposure analysis.

The 51�Թ��� says: The FDA should withdraw the proposed standard and publish a new rule that contains scientifically sound and accurate testing methods.

• “Manufacturers support the use of sound science,” said 51�Թ��� Managing Vice President of Policy Charles Crain. “The FDA has the opportunity to repromulgate this flawed rule to provide for accurate, science-based testing that actually protects consumers—rather than a flawed standard that could have far-reaching and costly consequences throughout the manufacturing industry.”

SkyWater Technology is leading the effort to rebuild domestic semiconductor manufacturing in the United States. As the only U.S. investor-owned and -operated pure-play semiconductor foundry in the U.S., SkyWater plays a critical role in reshoring key parts of the global supply chain and reducing America’s reliance on foreign-made chips.

The approach: SkyWater’s approach goes beyond traditional manufacturing. Its “Technology as a Service” model combines advanced R&D with wafer fabrication, allowing customers to co-develop new technologies using custom manufacturing processes.

• This collaborative model accelerates innovation and enables a flexible, secure production pipeline for customers, so they don’t have to build their own fabrication infrastructure.

The expansion: Today, SkyWater is expanding its U.S. footprint. The company recently finalized its of Infineon Technologies’ semiconductor fab in Austin, Texas—an investment that will allow SkyWater to scale its operations, support commercial and government partners and create a more complete domestic supply chain from chip design through packaging and testing.

• “The United States has operated in a global supply chain with regional centers of excellence—but now, those regional centers are getting reconfigured,” said SkyWater CEO Thomas Sonderman. “That comes with new opportunities.”

The challenge: Still, semiconductor manufacturing also comes with significant financial challenges. The industry is capital intensive, and investments in new infrastructure or equipment can require years of lead time and billions of dollars.

• That’s why federal support through stable and predictable tax policy is essential to SkyWater’s success—and to America’s semiconductor future, said Sonderman.

The policy: SkyWater welcomed Congress’s recent passage of the reconciliation package that made permanent vital pro-manufacturing tax provisions, including immediate R&D expensing and full capital equipment expensing. The law also increased the advanced manufacturing investment credit, an incentive for semiconductor manufacturing, from 25% to 35%.

• “In our industry, if you don’t stay at the leading edge, somebody will pass you by,” said Sonderman. “The United States is in a vulnerable state now, because we’re telling people we want to make stuff in the U.S., but we don’t have the capabilities to make stuff in the U.S. at scale today.”
• “Having the tax incentives is absolutely critical,” he emphasized. “If they go away, it’ll be much harder to establish manufacturing independence for the United States.”

The competition: The stakes are high. China in chipmaking investments, according to industry researchers, and the U.S. cannot afford to fall behind. And as Sonderman put it, tax incentives aren’t just about finance—they’re about building national capability and ensuring the next generation of technology is made in America.

• “The money is important,” said Sonderman. “But the money is not as important as the commitment.”

Milo’s Tea Company, the maker of popular iced tea, lemonade and other products found in grocery stores nationwide, stepped in to help in the recovery efforts following the devastating flooding in Texas.

Pausing production: Milo’s Chair and CEO Tricia Wallwork, an 51�Թ��� board member, told the story on on Friday:

• “Yesterday, we made the decision to pause tea and lemonade production at Milo’s Tea Company, Inc. at our Tulsa, Oklahoma, plant—not for a business reason, but because our neighbors in Texas need clean drinking water more than anything else right now, and disaster relief is something we feel strongly about.”
• “On Sunday, five truckloads—124 pallets and more than 119,000 bottles—of Milo’s bottled water will arrive at the San Antonio Food Bank to support flood relief efforts in a community that’s experienced unimaginable loss.”
• “As a mother, wife and human, my prayers go out to all those impacted by the horrific flooding in Texas.”

Teamwork: “[A]s the #ProudCEO of Milo’s, I am thankful that we can do a small, little something to help. Our TEAms response was swift. It came together in just 24 hours. Every single function at Milo’s—from operations and supply chain to quality and logistics—rallied to make it happen,” Wallwork wrote.

• “We’re also incredibly grateful to our transportation partner R.E. Garrison Trucking, Inc., who donated the freight, and to Feeding America and H-E-B, whose partnerships make swift, meaningful responses like this possible.”

A company mission: “Disaster response has long been one of the pillars of our Corporate Responsibility commitment at Milo’s. From Hurricane Helene in [North Carolina] . . . to today’s flooding in [Texas], we’ll continue showing up authentically where we’re needed—with heart, humility and help,” Wallwork concluded.

There’s a lot for manufacturers in the U.S. to celebrate right now, starting with the historic passage of the One Big Beautiful Bill Act with pro-growth tax provisions—but they are still seeking more policy fixes to help them grow and compete, the 51�Թ��� said last week at the 14th annual at The Brookings Institution.

Starting with tax policy: “When we think about the president’s manufacturing strategy, his manufacturing policies, you really have to start with tax policy,” 51�Թ��� Managing Vice President of Policy Charles Crain said about manufacturing under the Trump administration.

• “We know from the 2017 Tax Cuts and Jobs Act the impact that pro-growth tax policy [had] on manufacturing in 2018 and 2019. Coming out of the TCJA, we saw record capital investments in the manufacturing industry. We saw record job increases. We saw record wage increases.”
• The One Big Beautiful Bill Act, signed into law on the Fourth of July, “prevents … tax increases, and it really should support manufacturers’ efforts to drive manufacturing growth,” Crain continued, adding that the OBBBA included incentives for capital equipment purchases, research and development, factory building and more.
• The legislation is “a big win” for manufacturing and “a real credit to the president,” he said.

Reaching a shared goal: Even if the U.S. were “operating at full capacity,” manufacturing in the country would still require imports from other nations—making a commonsense trade policy a necessity, Crain said.

• In practice, manufacturing in the U.S. is only making about 67% of inputs required for finished goods, Crain said.
• “So we really need to solve for that 30-ish percent of outstanding inputs that we need to make things here. … Manufacturers need inputs to make things, and we need export markets to sell things. And so we think that a commonsense trade policy can allow for the president to achieve [the administration’s] trade policy goals without preventing manufacturers from investing here in America, which is a goal we all share.”

Giving manufacturers certainty: In the latest quarterly , just 55% of manufacturers—the lowest reading since the global pandemic in 2020—reported feeling positive about their companies’ outlook, Crain said. The top reason for the optimism drop? Trade uncertainty, something that a comprehensive U.S. trade policy can help remedy.

• Not knowing what to expect next when it comes to trade “makes it more difficult to make long-term investment decisions that we know drive manufacturing growth,” according to Crain.
• While tax uncertainty has now “been taken off the table” thanks to the passage of the OBBBA, “we’re still facing additional barriers to those long-term decisions that we need to create jobs here in America.”
• It’s also critical to manufacturing in the U.S. that the current corporate tax rate be maintained, Crain said. “[I]f we have a 35% corporate rate as opposed to the current 21[%], it’s going to be really difficult to onshore domestic manufacturing.”

Fewer regulations needed: Manufacturing in the U.S. also needs more balanced regulations—and fortunately, that’s something the administration began doing on day one.

• “[M]anufacturers, in our experience, have been very encouraged to see the administration taking a second look at some of the rules that were finalized in recent years … finding ways to maintain reliable rules of the road, but [also] to make those rules less costly.”

Open jobs in manufacturing: Manufacturers also remain committed to filling the 400,000 open manufacturing jobs in the U.S., Crain said, addressing an audience question.

• Manufacturers “are really focused on providing competitive benefits, having flexible work schedules, having onsite child care” as well as “partnering with local community colleges to implement training programs [and] partnering with the military to bring folks coming out of active duty into manufacturing shop floors.”

The takeaways: The OBBBA “delivers for manufacturers in America by making pro-growth tax provisions permanent,” Crain on X following the event.

• But “[t]o ensure we can continue to grow manufacturing in America, policymakers must pursue a comprehensive manufacturing strategy that will provide manufacturers the tools, and the certainty, needed to make long-term investments,” he wrote in a .

President Trump issued more tariff letters late last week, warning major U.S. trading partners of the tariffs that will go into effect if negotiations do not lead to agreements by Aug. 1. Tariffs on Canadian imports will be assessed at 35%, while Mexican and European Union imports will see new tariffs of 30%.

Canada: The letter to Canada accuses the country of failing to stop the flow of fentanyl drugs into the U.S., while also citing tariff and nontariff trade barriers, including dairy policies.

• Canada is subject to an International Emergency Economic Powers Act fentanyl tariff rate of 25%. According to an April 2 executive order, if IEEPA fentanyl tariffs are withdrawn, a 12.5% IEEPA “reciprocal” tariff rate would replace them.
• USMCA-compliant goods are exempt from the existing Canada tariffs. The July 10 letter does not specify whether goods that qualify for an exception under the USMCA will continue to be exempt. It also does not say whether energy and energy resources from Canada will still be subject to the lower 10% tariff.
• The letter also warns that goods that are transshipped will be subject to an unspecified, higher tariff, and that an additional 35% tariff will be imposed should Canada retaliate.

Mexico: The letter to Mexico cites the country’s “failure to stop the Cartels,” while also mentioning trade barriers.

• Mexico is subject to the same arrangement as Canada under the April 2 executive order—IEEPA fentanyl tariffs of 25%, which if withdrawn would be replaced by a 12.5% “reciprocal” tariff.
• The letter to Mexico is likewise unclear about the USMCA exceptions and contains similar warnings about transshipment penalties and an additional 30% tariff in the case of retaliation.

EU: The European Commission also received a letter, which threatens the EU with a 30% tariff, a number “far less than what is needed to eliminate the trade deficit.” The letter also says that the U.S. expects “complete, open market access.”

• ������ were set to take effect this week but have been suspended pending negotiations.

The response: In a   on X, Canadian Prime Minister Mark Carney said, “We are committed to continuing to work with the United States to save lives and protect communities in both our countries. … We are strengthening our trading partnerships throughout the world.”

• In a , EU Commissioner Ursula von der Leyen said the EU is “working towards an agreement by August 1,” adding that the EU “will take all necessary steps … including the adoption of proportionate countermeasures if required.”