FCIB's 23rd Annual Global Conference has kicked off in Philadelphia with the topic of U.S.-based trade high on the list of priority topics. To wit, U.S. Chamber of Commerce Vice President John Murphy discussed recent trade-related victories emanating from the U.S. federal government and what needs to be at the top of the agenda going forward.
Of its big three concerns for 2011 and 2012, two have been accomplished: Congress approved the three Free Trade Agreements and, despite some argument involving the role of and/or "size of government" objections, the charter of the Export-Import Bank of the United States was reauthorized. Murphy noted both were of massive importance, as is a yet-to-be worked out legislative agreement in the U.S. Congress involving restrictions on the books regarding Russia. Russia continues to become a more open economy with its newfound accession into the World Trade Organization; however, long-standing laws on the books technically would allow Russia to discriminate against U.S. businesses until they are removed.
"The U.S. has to pass legislation so American companies can get those benefits; other nations are already benefiting from Russian's ascension," Murphy said. He added that Congress could begin tackling this issue as early as Friday, during the lame-duck session. Murphy also laid out a five-point agenda of what the Obama Administration should, in the eyes of the chamber, focus on in 2013 and beyond to continue helping U.S. businesses take advantage of growth opportunities through exporting:
Trade Promotion Authority – President Barack Obama needs to request this power, which includes the ability to negotiate Free Trade Agreements (FTAs), which every president since Franklin Roosevelt has had. The Chamber expects the president will ask for it in the second term.
Trans-Pacific Partnership – There needs to be more interest in the “Pivot to Asia” area. Nearly half of the $22 trillion in global economic growth between now and 2020 will be in the Asia-Pac region. Of late, the U.S. share of Asian imports actually fell 43% in the last decade. Lack of FTAs are part of the problem, especially in East Asia.
Trans-Atlantic Trade and Investment Pact possibility – U.S-EU commerce leads the world with $1.5 trillion in goods, services and income receipts. The High-Level Working Group sees a potential agreement, reportedly, and could recommend it in a report expected to be out before year's end. Murphy noted the barriers are low already "but volume is so large that even removing low barriers would lead to a economic impact that would be significant.”
New FTAs – Brazil, Egypt, India and Indonesia all represent places of growing opportunity and are places the U.S. should target. There are significant barriers in all of these, however, which doesn't even touch on the point that getting the last three FTAs through (South Korea, Panama, Colombia) and into enactment were near-decade-long tasks.
Multilateral Trade Deals – There's new hope an International Services Agreement could be negotiated. The prospects are actually excellent that negotiations will start next year. In addition, a Trade Facilitation Agreement would speak to reforming international customers' procedures. "Time is money. Where clearance can take days, that imposes a real cost that is often higher than the actual tariffs," said Murphy. A third piece would be to expand product coverage of the Informational Technology Agreement; when the info tech agreement was last negotiated, smartphones/tablets weren't in existence. An update therein is badly needed.
-Brian Shappell, CBA, NACM staff writer.