Four Ways to Boost Global Trade

G20This year’s G20 Leaders Summit concluded last week in Hangzhou, China. The event took place against a backdrop of sluggish GDP growth and growing concerns about stagnating living standards – leading G20 leaders to place a heavy emphasis on global trade as an engine of inclusive growth and job creation in their annual communiqué. The International Chamber of Commerce (ICC) and USCIB commended the G20’s focus on strengthening the global trading system, but turning words into action has not always been a strong point for the G20 when it comes to trade.

Here are four ways we think the G20 can take meaningful action in the coming months to revitalise world trade as a driver of growth, opportunity and jobs:

1. Ratify the WTO’s Trade Facilitation Agreement

Four G20 countries are yet to ratify the World Trade Organisation’s landmark Trade Facilitation Agreement forged in 2013. ICC has called for the deal to be ratified and implemented without delay to facilitate access to global markets by reducing unnecessary red tape at borders. The deal could add more than US$1 trillion to global trade flows, creating 20 million jobs in the process. G20 governments need to lead by example in ensuring this agreement is implemented without further delay.

2. Stop protectionism in its tracks

A recent WTO report cited that between mid-October 2015 and mid-May 2016, G20 economies had introduced new protectionist trade measures at the fastest pace seen since 2008.

ICC has been clear that tackling protectionism should be a first order priority for the G20 and has called on the G20 to lead by example when it comes to refraining from introducing new trade barriers.

3. Spearhead talks on digital trade

In a letter to the Financial Times published Monday, ICC Secretary General John Danilovich said that spearheading talks on a new e-commerce agreement under the auspices of the World Trade Organisation could “unleash a new era of genuinely inclusive growth”.

With studies showing the growth of small- and medium-sized enterprises using online platforms to be five times more likely to export than those in the traditional economy, ICC believes efforts to level the global trading field must start with a concerted push to address remaining barriers to Internet-enabled commerce.

4. Make the case for why trade matters

ICC couldn’t agree more with the G20’s analysis that the benefits of trade and open markets must be communicated to the wider public more effectively. But amid souring public opinion on trade in many of the world’s largest economies what is the best way to explain how and why trade matters for all?

Launched earlier this year, ICC’s #TradeMatters campaign aims to promote a balanced and evidence-based debate on the role of trade in today’s economy. One based on fact and experience rather than the myth and hearsay of political campaigns.

As part of the campaign we want to tell your trade story: what does importing or exporting mean for your business? Where do you need help to better access international markets?

Business Urges Congress to Approve Ex-Im Bank Quorum Requirement

Money_globeUSCIB joined 14 other business associations urging Congress to approve the Export-Import (Ex-Im) Bank’s quorum requirement so that it may again review transactions over $10 million.

“While the Ex-Im Bank is back in operation and accepting new applications, it is prohibited from approving significant transactions because of the lack of a quorum on the Bank’s Board of Directors,” the business group wrote in a letter sent to Congressional leaders on September 12. “As a result, manufacturers and other exporters throughout the United States are at a significant disadvantage to global competitors who are aggressively supported by their own governments’ export credit agencies.”

The business associations argued that a fully operational bank would support millions of U.S. jobs by enabling companies to compete more successfully in the global economy. USCIB and others noted that the Bank is a vital tool in leveling the global playing field, helping American businesses secure new customers, particularly in emerging markets.

“With every passing day, businesses from the United States are missing out on new business opportunities overseas, to the detriment of local economies and American jobs. Congress can and must act swiftly,” USCIB and others wrote. “As associations representing millions of businesses throughout the United States, we urge you to move forward legislation as part of the Continuing Resolution that will enable Ex-Im to consider and act on all transactions immediately to boost America’s ability to compete globally.”

Read the full letter.

G20 Leaders Make Broad Commitments to Expand Trade, Resist Protectionist Policies

G20G20 leaders held their annual summit in Hangzhou, China on September 4-5.  USCIB participated in the B20 Trade and Investment taskforce this past year, and we were pleased to see that the G20 leaders statement included support for several issues on trade that were part of the B20 recommendations.  Some of the key aspects of the statement:

  • G20 leaders committed to ratification of the Trade Facilitation Agreement by the end of 2016 and called on other WTO members to do the same.
  • They committed to advancing negotiations in the WTO on issues remaining from the Doha Development Agenda  and recognized the need to discuss in the WTO other issues that may be of common interest to members and of importance to today’s economy.
  • Leaders reiterated their opposition to protectionism and extended their commitments to standstill and rollback of protectionist measures until the end of 2018.
  • Those participating in the Environmental Goods Agreement negotiations welcomed the landing zone achieved in the EGA negotiations and reaffirmed their efforts to conclude by the end of 2016.
  • Leaders endorsed the G20 Strategy for Global Trade and Growth, under which the G20 will lead by example to lower trade costs, harness trade and investment policy coherence, boost trade in services, enhance trade finance, promote e-commerce, and address trade and development.

Following the summit, the International Chamber of Commerce (ICC), for which USCIB serves as the American national committee, issued a statement calling on G20 leaders to match their actions to their words to push back against a rising tide of protectionism worldwide.

“In the current environment, it will be critical for the G20 governments to follow through on these and the other commitments they made in their communique,” said Rob Mulligan, USCIB’s senior vice president for policy and government affairs. “We will be working directly with the U.S. government and, through ICC, with other governments to press for effective action.  We will also look to engage with German B20 leaders as Germany hosts the G20 for the coming year.”

Business Pushes for TFA Ratification at G20 Summit

International flagsPromoting robust trade and investment is a key focus of the B20 2016 policy recommendations to the G20 summit, which will take place in Hangzhou, China on September 3 and 4. Business recommendations include improving the global investment environment, strengthening the multilateral system and rolling back protectionist measures. USCIB and several of its members contributed to the recommendations. According to Rob Mulligan, USCIB’s senior vice president for policy and government affairs, G20 governments can take one easy step to boost growth.

“The upcoming summit is an important opportunity for the G20 to push for the ratification of the World Trade Organization’s Trade Facilitation Agreement by the end of this year,” Mulligan said. Once implemented, the TFA has the potential to increase global exports by up to $1 trillion per year, according to the WTO’s World Trade Report.

The International Chamber of Commerce (ICC) also published a set of business recommendations for sustained economic growth ahead of the G20 summit.

Additionally, President Obama will promote the Trans-Pacific Partnership (TPP) during his upcoming trip to China and Laos in early September, according to a White House statement released on August 18. As part of Obama’s Asia trip, he will attend the G20 summit and use use the visit as an opportunity to discuss a wide range of global and regional issues, including adoption of TPP.

“This visit also will support the President’s efforts to expand opportunities for American businesses and workers to sell their products in some of the world’s fastest-growing markets,” the White House said in a statement. “Central to this effort is the Trans-Pacific Partnership, the high-standards trade agreement that will unlock key markets to American exports and cement America’s economic leadership in the Asia-Pacific.”

Obama’s push for TPP comes at a time of growing skepticism that the trade agreement will be approved before election day in November. Both Republican and Democratic nominees for president oppose the agreement.

Business Urges China to Revise Cybersecurity Laws

Cyber security concept with lockUSCIB joined a group of 45 business organizations from around the world warning the Chinese government that it would harm business operations and restrict trade if it implements proposed cybersecurity and insurance rules.

A letter the group sent to Chinese Premier Li Keqiang on August 10 urges China to live up to its role as the host of this year’s G-20 leaders summit in September to promote the meeting’s goals of creating an “innovative, invigorated, interconnected and inclusive world economy.”

“[T]he current drafts, if implemented, would weaken security and separate China from the global digital economy,” USCIB and others stated in the letter. “To that end, we urge both The Law and The Provisions be revised to encourage international policy models that will support China’s development as a global hub for technology and services. This will assure a legacy of an innovative, invigorated, interconnected and inclusive world economy from China’s G20 presidency.”

Read the letter.

Washington Update: June – July 2016

washington-Lincoln-MemorialsDuring the months of June and July 2016, USCIB hosted the 11th annual OECD International Tax Conference with over 350 attendees; participated in the OECD Digital Economy Ministerial and related BIAC Stakeholder Day; held committee meetings with high-level government officials including Everett Eissenstat, Chief International Trade Counsel for the Senate Finance Committee, S. Deepak, Secretary of the Indian Department of Telecommunications, and Bruce Hirsch, Assistant U.S. Trade Representative for Japan, Korea, and APEC; presented as part of a WITA panel on trade and investment; hosted a briefing for members on FENSA and other key WHO issues; and much more.

Download the full update.

Pro-Investment Policies Really Matter!

International flagsThe OECD’s Development Assistance Committee (DAC) is the premier international body where major foreign donors discuss development policy issues and coordinate their assistance programs.  The DAC just released its 2016 Annual Report “The Sustainable Development Goals as Business Opportunities,” with a special focus on the key role the private sector and foreign direct investment (FDI) can play in economic development of poorer nations.  The DAC report was unveiled last Month in New York during the United Nations’ High-Level Political Forum, where USCIB member companies and the International Chamber of Commerce played a lead role in highlighting the efforts business is making to support the UN Sustainable Development goals (SDGs).

Shaun Donnelly, USCIB’s vice president for investment and financial services, was one of the outside commentators representing a wide range of views invited to offer opinion pieces sprinkled throughout the DAC report. Donnelly’s piece, “Pro-Investment Policies Really Matter,” argues that foreign direct investment can be a major contributor to economic development only if the recipient countries have the right pro-investment policies and a strong rule-of-law culture.

Read Donnelly’s Pro-Investment Policies Really Matter

Read the OECD DAC Report: The Sustainable Development Goals as Business Opportunities

Check out USCIB’s coverage of the report here.

 

The Sustainable Development Goals as Business Opportunities

SustainabilityThe scale and ambition of the United Nations Sustainable Development Goals (SDGs) create a tremendous opportunity for the private sector to demonstrate the central role it plays in human prosperity. Business will serve as an essential partner to meet the challenge of achieving the SDGs.

The recently unveiled OECD Development Co-operation Report 2016: The Sustainable Development Goals as Business Opportunities, acknowledges the private sector’s role as a “powerful promoter of sustainable development”. It also highlights the opportunity for the governments to leverage private sector contribution, helping to manage risk and providing insights into effective policy and practice. The publication lists the enabling factors, as well as the constraints, for businesses and investors interested in addressing sustainable development challenges.

The report also provides guidance on responsible business conduct and outlines the challenges in mobilizing and measuring private finance to achieve the SDGs. Throughout the report, practical examples illustrate how business is already promoting sustainable development and inclusive growth in developing countries. USCIB and its global network contributed to the report:

  • Shaun Donnelly, USCIB’s vice president for investment and financial services, contributed an article titled “Pro-Investment policies really matter!” about the link between good investment policies and development (p. 61 in the report).
  • Louise Kantrow, the International Chamber of Commerce’s permanent representative to the United Nations, highlighted the shared interests between the business community and the development community in her piece, “Sustainable development challenges are business challenges.” (p. 28 in the report)
  • And during the report’s launch event, USCIB Vice President for Labor Affairs, Corporate Responsibility and Governance Ariel Meyerstein showcased the influential Business for 2030 website, an initiative by USCIB highlighting the contributions from the private sector in helping to achieve the SDGs.

More details, including ways to access the report can be found on the OECD Website.

USCIB Talks Trade with European Journalists

Shaun Donnelly (third from left).
Shaun Donnelly (third from left).

If passed, the Transatlantic Trade and Investment Partnership (TTIP), a trade agreement between the United States and the European Union, would liberalize one third of global trade, stimulating economic growth and creating jobs on both sides of the Atlantic.

On July 18, USCIB Vice President Shaun Donnelly and Eva Hampl, director of investment, trade and financial services, hosted a dozen visiting journalists from European Union nations to discuss the on-going TTIP negotiations.

The group of European journalists, visiting Washington and Boston on a week-long program sponsored by the U.S. State Department to familiarize European media leaders with American perspectives on T-TIP, met with representatives from government, academia, business and other experts.

Donnelly and Hampl had a lively, hour-long on-the-record session which focused on investment chapter issues, including Investor-State Dispute Settlement (ISDS), regulatory issues and the political backdrop to the negotiations on both sides of the Atlantic. The meeting provided a good opportunity for USCIB to articulate U.S. business positions, priorities and concerns on the important TTIP negotiations.

Please contact Donnelly (sdonnelly@uscib.org) or Hampl (ehampl@uscib.org) for additional details on the interview session for interested members.

USCIB Helps State Department Launch 2016 Investment Climate Statements

Donnelly_CSISAn important component of the U.S. State Department’s economic mission, the Investment Climate Statements contain country-level information on a variety of issues important for U.S. businesses, such as market barriers, business risk and intellectual property rights. On July 5, the Center for Strategic and International Studies (CSIS) hosted the State Department’s presentation of the statements’ key findings. USCIB Vice President for Investment and Financial Services Shaun Donnelly joined leaders from the State Department’s Economic and Business (EB) Bureau, and other investment experts for the launch event.

Scott Miller, Scholl Chair holder in International Business at CSIS and a former Chair of USCIB’s Trade and Investment Committee, emceed the roll-out event. Kurt Tong, Acting Assistant Secretary in the EB Bureau, highlighted the improvements made in this 2016 version of the 170 country-by-country Investment Climate Statement reports, each laying out the legal and policy environment, opportunities and challenges U.S. investors encounter, whether in an established European market, a key emerging market like China or India, or in a smaller developing nation. Donnelly and other panelists then offered observations on the value of the reports for USCIB members and American business.

“Anyone considering investments in a new market overseas should definitely consult the relevant Investment Climate Statements and may want to follow up in more detail with the key staff in State’s Investment Office or in the particular US embassy which prepared the relevant country report,” Donnelly said.