Alice Slayton Clark Archives

Business Leaders Deliver Priorities to the G20

Published on September 11, 2015

B20 2015 ConferenceMore than 1,400 business leaders and CEOs from 65 countries gathered in Turkey, Ankara for the 2015 Business-20 (B20) Conference from September 3 to 5. The three-day event marked the completion this year’s B20 recommendations and provided an opportunity for the business community to share its priorities with Turkish President Erdoğan ahead of the G20 Leaders’ Summit in Antalya in November. Turkey is the G20 host nation for 2015. Ronnie Goldberg, USCIB’s senior counsel, attended the conference.

During his opening remarks President Erdoğan thanked B20 Turkey Chair Rifat Hisarcıklıoğlu, who also serves on the International Chamber of Commerce (ICC) Executive Board, for hosting an effective B20 process.

“The B20 is the most inclusive of all G20 engagement groups and the regional consultations and events organized by B20 Turkey have made the B20 the most important business platform in the world,” said President Erdoğan. “Turkey will support the B20 recommendations at the G20 Summit in November.”

Rob Mulligan, USCIB’s senior vice president for policy and government affairs, participated directly in meetings of the B20 Trade Taskforce, the recommendations of which are available on the B20 website. At the meetings, Mulligan helped focus the taskforce on 3 recommendations:

  1. pressing for ratifications and implementation of the WTO Trade Facilitation Agreement;
  2. rolling back protectionist measures with a focus on localization barriers to trade;
  3. improving the global trade system for the emerging digital economy including rolling back cross-border data flow restrictions.

Several of USCIB’s member companies had representatives active on the various B20 taskforces.

ICC and USCIB Chairman Terry McGraw led a delegation of the ICC G20 Advisory Group to Ankara for discussions with business and government representatives. ICC Leadership actively participated in the conference, with McGraw, ICC Secretary General John Danilovich and ICC G20 CEO Advisory Group Chairman Marcus Wallenberg delivering business priorities to the opening plenary sessions.

“Growth and job creation should remain at the top of the G20’s priorities,” said McGraw. “These objectives can be achieved by promoting structural reform within G20 economies; by liberalizing trade and investment; by ensuring well-regulated, growth-enhancing financial markets; and by creating a healthy environment for innovation and new businesses.”

Addressing the G20’s past performance and growing demands for global governance, Wallenberg suggested that the G20 focus its attention on implementation of previously agreed reforms and commitments before introducing new areas of work. To illustrate his point Mr Wallenberg highlighted the ICC G20 Business Scorecard as a tool to monitor the G20’s performance on implementing B20 recommendations.

A highlight of the B20 Conference was the official introduction of the World SME Forum (WSF) as a mechanism for implementing the many SME recommendations developed under B20 Turkey. The WSF is a new global platform co-founded by ICC and the Union of Chambers and Commodity Exchanges of Turkey (TOBB) to amplify the voice of SMEs and unlock their potential to stabilize the economy and stimulate economic growth, trade and employment.

“Never before has the B20 taken such a robust approach to correcting the imbalances in the SME sector”, said Mr Danilovich during a special plenary session on the WSF. “I would like to thank the Turkish government and B20 Turkey for championing economic inclusiveness and support to the SME sector as key priorities in 2015.”

With over 21 panel sessions and 123 speakers, the Ankara conference was the largest business gathering in the B20’s 6-year history.

The 2015 G20 Leaders’ Summit will be held in Antalya on November 15-16.

ICC Open Markets Index: More Effort Needed on Trade

Published on September 3, 2015

2015 OMI_twitter_G20_sourceDespite repeated pledges to enable trade as a driver of growth and job creation, G20 economies are failing to demonstrate global leadership on trade openness according to the ICC Open Markets Index 2015 (OMI), published on September 3.

The report – commissioned by the International Chamber of Commerce (ICC) – shows that G20 nations rank below the global standard in terms of openness to trade, with only Germany placing among the world’s top 20 open markets. Singapore and Hong Kong head the 2015 rankings for the third successive edition of the report, far outstripping major economies such as the United States in terms of trade openness.

The Index scores 75 countries on a scale of one to six on four key factors: observed trade openness, trade policy, openness to foreign direct investment and trade-enabling infrastructure. In doing so, the Index also monitors government follow-through on longstanding G20 commitments to boost global trade flows, including pledges made at last year’s leaders’ Summit in Brisbane, Australia.

The latest edition of the Index reveals that 16 of the G20 economies score only average or below average in terms of their overall openness to trade. The two lowest-scoring G20 economies are Brazil and India, though both economies have seen an increase in their score from last year.

“As world leaders look for new engines of growth in the current economic environment, the OMI data shows that there is still substantial scope for G20 leaders to take action to boost global trade,” said ICC Secretary General John Danilovich. “Rolling back protectionism and implementing reforms to facilitate trade flows should be cornerstones of a revitalized G20 agenda to promote renewed growth and stability in the global economy.”

Read more on the ICC website.

TPP Ministers Make Progress, But Fail to Seal the Deal

Published on August 3, 2015

Maui_sunset_resizedNegotiators from the 12 Trans-Pacific Partnership (TPP) parties, meeting in Maui last week, failed to hammer out the final text of a TPP agreement, although they did say they made substantial progress on a number of important issues.

According to reports, negotiators could not bridge final differences over several longstanding disagreements, including Canadian dairy market access, Japanese barriers to rice and other agricultural imports, automotive supply chain issues, and U.S. demands for strong intellectual property protections, including for a new generation of pharmaceuticals. Japanese Economy Minister Akira Amari said that trade ministers would seek to meet again before the end of August, and that only one more meeting would be necessary to finalize a TPP deal.

The U.S. Coalition for TPP, which groups a large number of leading companies and industry associations, including USCIB, issued a statement that read in part: “The TPP represents an important step toward greater cooperation and economic engagement among the 12 partners of the TPP in the Asia-Pacific region, and the United States must continue to pursue the closure of negotiations. We applaud U.S. Trade Representative Michael Froman and his team for their work on the TPP and we are hopeful that the progress made during this round has built the necessary momentum for the swift closure of negotiations.”

Throughout the TPP negotiations, USCIB and the coalition have emphasized that it is more important to get the most ambitious, highest-quality TPP agreement than to meet any artificial deadlines.

 

ICC Chairman, Chinese Vice Premier Strengthen Business Ties

Published on July 30, 2015
L-R: Terry McGraw (ICC) and Chinese Vice Premier Wang Yang
L-R: Terry McGraw (ICC) and Chinese Vice Premier Wang Yang

International Chamber of Commerce (ICC) and USCIB Chairman Terry McGraw met with Chinese Vice Premier Wang Yang in Beijing on July 29 to underscore the importance of incorporating the voice of Chinese companies into global economic governance forums.

McGraw held a series of meetings with Chinese government leaders and business officials seeking to secure the engagement of Chinese companies in ICC’s work to promote cross border trade and investment.

“ICC is the world business organization and our mission is to represent the views of international business to policymakers in key forums such as the G20, the World Trade Organization, the World Customs Organization and the UN Framework Convention on Climate Change,” he said. “China has the world’s second largest GDP and is critical player in the world economy. It is therefore essential that Chinese companies are involved in ICC’s international policy-making process.”

Wang welcomed McGraw’s support and spoke positively of the indispensable role played by ICC in promoting economic growth, global trade and investment, and in strengthening global economic governance.

“We wish to step up our cooperation between Chinese companies and ICC,” said Wang. “China is willing to draw upon your suggestions and I hope ICC will play an active role in China’s reform and increasing exchanges with Chinese business to create more opportunities for foreign cooperation with Chinese companies.”

Wang said the China Chamber of International Commerce (CCOIC) – which houses ICC China – will be responsible for maintaining the close and frequent interactions with ICC.

McGraw also pointed to China’s upcoming G20 presidency, beginning on December 1, and explained that Chinese business will have an increasingly important opportunity to help shape the G20 policy agenda. McGraw shared current Business 20 (B20) priorities under development for the G20 Summit in Antalya, Turkey in November, highlighting trade, investment, infrastructure, human capital and education as priorities for G20 consideration.

“ICC has historically conveyed business priorities to G20 Leaders, and has served as a strategic partner to national B20 hosts to develop policy recommendations for G20 consideration,” said McGraw. “ICC is committed to supporting the Chinese government and the Chinese business community in its preparations for hosting the G20 and we are investing now in our long-run work plan with ICC China and CCOIC.”

Jiang Zengwei, chairman of the China Council for the Promotion of International Trade (CCPIT) joined McGraw in the meeting with Wang.

“We highly value the role of ICC,” said Jiang. “As we grow the participation of Chinese companies in CCOIC, we will work closely with ICC for support on educating Chinese businesses and incorporating their views in critical international policy forums, including trade, investment and intellectual property.”

McGraw and Jiang agreed to a long-term program, featuring a growing number of ICC meetings in China, to develop CCOIC contributions to ICC international business policy.

ICC’s delegation to Beijing also included Cherie Nursalim, vice chairman of GITI Group; Sara Dai, president of Novozymes China; Zhang Yanling, Bank of China and member of ICC Executive Board; Cindy Braddon, vice president for international affairs, McGraw Hill Financial [now S&P Global]; Jeffrey Hardy, director, ICC G20 CEO Advisory Group; and Robert Milliner, senior director, Wesfarmers and B20 Australia Sherpa.

 

 

USCIB, Members, Gov’t Reps Discuss China Engagement with U.S., OECD

Published on July 28, 2015

Blue sky and white clouds, ancient Chinese architectureOn the heels of both the U.S.-China Strategic & Economic Dialogue (S&ED) and the visit of Chinese Premier Li Keqiang to the OECD Headquarters in Paris, USCIB held an important briefing with members to discuss ongoing U.S.-China and OECD-China engagement. USCIB and members met with representatives from several U.S. government agencies, the OECD and the Electronic Industry Citizenship Coalition (EICC) on Wednesday, July 22 at Foley & Lardner LLP in Washington, D.C.

Audrey Winter from the USTR China Office, Michael Tracton from the Office of Investment in the State Department’s Economic Bureau and Zhao Li from the Department of Labor discussed outcomes of the S&ED regarding trade, ICT, investment and labor. Tracton also discussed the increasing collaboration between the OECD and China, which is exemplified by the recent agreement of Primer Li and OECD Secretary General Angel Gurría to develop an OECD-China work plan, as well as collaboration on Chinese responsible business conduct.

The second panel included the State Department’s head on conflict minerals, Eileen Kane, who reported out on her recent trip to China, where she met with several Chinese officials and agencies to gain important connections and advance the relationship with China in regard to conflict minerals. Tyler Gillard, head of sector projects and legal adviser in the responsible business conduct unit from the OECD’s Investment Division, also joined by video conference to provide an overview of the OECD’s broader outreach and capacity-building on conflict minerals with the China Chamber of Commerce. Tara Holeman, program director from EICC, discussed the Conflict-Free Sourcing Initiative (CFSI), which has been developed in line global standards including the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals and the U.S. Dodd-Frank Wall Street Reform and Consumer Protection Act.

ICC: New Anti-Corruption Guide for SMEs

Published on July 28, 2015

new-guide-smes_sourceThe International Chamber of Commerce (ICC) has released “Anti-corruption Third Party Due Diligence,” a new guide to help small- and medium-sized enterprises (SMEs) assess and manage corruption risks associated with engaging third party suppliers.

SMEs are often on the receiving end of burdensome due diligence procedures. The new ICC anti-corruption tool inspires businesses to engage in due diligence by creating achievable and manageable goals.

“Corruption hinders economic growth and erodes trust in both businesses and governmental institutions,” said Viviane Schiavi, senior policy manager of the ICC Commission on Corporate Responsibility and Anti-corruption, and co-chair of the B20 Anti-corruption Task Force Training Work Stream. “It remains a major barrier that impacts businesses negatively by increasing the costs of doing business -especially for SMEs – and undermining the quality of both products and services. SMEs are drivers of economic growth in many economies yet often they need relevant training to do their part for responsible supply chains and sustainable growth.”

The ICC guide addresses SMEs’ need for capacity building on integrating global supply chains in an ethical and responsible way. It provides practical advice on how SMEs can cost-effectively conduct due diligence on third parties they engage to perform services on their behalf.”

This new anti-corruption tool is a direct response to the Turkish G20 and B20 efforts to implement concrete actions for private sector integrity, especially to empower SMEs in their fight against corrupt activities. It also supports one of the key United Nations Sustainable Development Goals, to be adopted during the UN’s General Assembly in September, which will work towards substantially reducing corruption and bribery in all its forms.

ICC has been a pioneer in the business fight against corruption, and is at the forefront of the development of ethics, anti-corruption and corporate responsibility advocacy codes and guidelines. The new guide will complement ICC’s robust suite of anti-corruption tools, which includes the Ethics and Compliance Training Handbook .

Hosting European Media, USCIB Makes Case for Ambitious Transatlantic Trade Pact

Published on July 22, 2015

shaunUSCIB’s Washington, D.C. office hosted a diverse group of 10 journalists from around the European Union yesterday for a discussion of the state of transatlantic trade talks. USCIB Vice President Shaun Donnelly provided an in-depth analysis of key issues at stake in the Transatlantic Trade and Investment Partnership (TTIP) negotiations.

Joined by Eva Hampl, USCIB’s director of investment, trade and financial services, Donnelly emphasized American business’s strong support for an ambitious and comprehensive TTIP agreement that sets high standards in areas such as regulatory cooperation and protection of investments. He also stressed that the negotiating dynamics as well as an ultimate agreement would be different from other U.S. and EU trade pacts, owing to the relative size and sophistication of the economies involved.

“Average tariffs between our two economies are now around three percent,” he observed. “So it’s clear that the ‘easy’ issues of reducing traditional trade barriers have already been tackled. What we need to do now is address the ‘hard’ issues: making our regulatory systems work together to expand trade and investment, streamlining government procurement rules and creating a level playing field with regard to state-owned enterprises.”

Since the beginning of the TTIP negotiations in 2013, the treatment of investor-state dispute settlement (ISDS) rules in TTIP has emerged as a lightning rod for many in Europe. Donnelly reminded the journalists that ISDS was in fact a European invention, forming a cornerstone of many bilateral investment treaties and free-trade agreements.

“Investment is now a central issue in trade negotiations,” Donnelly stated. “We need strong investment rules in TTIP, both to safeguard reciprocally beneficial FDI and as a benchmark for further agreements with other countries.”

The media roundtable was facilitated by the U.S. State Department’s Foreign Press Center.

USCIB Vice Chair Dennis Nally Begins ICC Leadership Term

Published on July 20, 2015
Frederico Curado (Embraer) and Dennis Nally (PwC)
Dennis Nally (PwC)

The International Chamber of Commerce (ICC) announced the appointment of Dennis Nally, chairman of PricewaterhouseCoopers International (PwC) and vice chairman of USCIB, and  Frederico Curado, president and CEO of Embraer, as ICC vice chairs.

Curado and Nally officially took up their positions on July 1 and join ICC Vice Chair Sunil Mittal following governance changes approved by the ICC World Council last month.

Nally has served as chairman of PwC since 2009. He is an expert on issues affecting the global capital markets and the professional services profession, and also leads many of PwC’s corporate responsibility efforts.

ICC Secretary General John Danilovich said: “We’re delighted to have Curado and Nally onboard and have no doubt that their leadership will further strengthen ICC’s governance and the ability to represent our members’ interests across the globe.”

As a result of governance changes, which included an extension to the serving terms of the ICC Chairmanship, current ICC Chairman Terry McGraw will now serve until 2016.

The ICC World Council meeting also saw five new appointments to the ICC Executive Board. They were: John Denton (Corrs Chambers Westgarth); Daniel Feffer (Suzano); Robert Gutsche (KPMG); Mari Pangestu (former Trade Minister of Indonesia); Yassin Saeed Al Suroor (Al Suroor United Group).

 

OECD Updates its Policy Framework for Investment

Published on July 6, 2015
Kimberly Claman (Citigroup)
USCIB member Kimberly Claman (Citigroup) speaks at the joint meeting of the World Bank and the OECD.

At last month’s annual Ministerial meeting of the Organization for Economic Cooperation and Development (OECD), the 34-member organization adopted and issued an important update to the OECD’s Policy Framework for Investment (PFI), first adopted nine years ago in 2006. Basic information on this OECD investment policy effort, including the text of PFI, the OECD’s fact sheet and press release, the Ministerial Council’s action on the PFI, and relevant background materials are available here.

The PFI offers a broad-based checklist of policy recommendations for consideration by individual governments, especially developing country governments who want to attract and retain Foreign Direct Investment (FDI).  The checklist is voluntary and has been used successfully in connection with OECD advisory services, regional FDI policy dialogues and policy review of individual countries that step forward to use this policy tool.

USCIB, both directly and through the OECD’s Business and Industry Advisory Council (BIAC) has been quite active in this effort to update the PFI.  USCIB staff and member company representatives have participated in reviews of draft versions of the update held in Paris, Brussels and Washington as well as playing a leading role in authoring detailed formal BIAC comments into the OECD drafting process.  I was honored to lead BIAC teams in the formal stakeholder consultations on PFI held in Paris and Brussels over the past year.  USCIB members Kimberley Claman of Citigroup and Nicole Bivens Collinson of Sandler Travis & Rosenberg P.A. were panelists at a joint OECD/World Bank seminar on the PFI held in Washington this spring.

Nicole Bivens Collinson (Sandler, Travis & Rosenberg)
USCIB member Nicole Bivens Collinson (Sandler, Travis & Rosenberg) speaks at the joint meeting of the World Bank and the OECD.

As in so many policy areas, in investment the critical variable is host government commitment to policy reform and implementation.  PFI is not a panacea or magic wand to attract investment. It should not be oversold. But in the hands of a government committed to policy reform in the investment area and beyond, the PFI has proven it can be a useful, practical tool to help improve investment climate to promote growth and development through FDI.

I commend the OECD for a job well done in updating the PFI and for the increased priority the organization is according to investment and FDI issues within OECD member countries and beyond.

This post was originally published on the Investment Policy Central website.

S&ED Outcomes: Investing in China

Published on July 6, 2015

S&EDLast week, the United States and China concluded their seventh meeting of the Strategic & Economic Dialogue (S&ED) in Washington, D.C.  The annual high level dialogue, which launched in 2009 to provide a forum to discuss a wide range of bilateral, regional, and global issues between the two countries, has become an integral part of the economic relationship. The meeting resulted in a number of joint strategic and economic outcomes issued by the Departments of State and Treasury which co-lead the U.S side.  The Treasury also published a U.S.-specific fact sheet on the outcomes of the economic track.

At the dialogue, both nations reaffirmed their commitment to negotiate a high-standard Bilateral Investment Treaty (BIT) and intensify negotiations.  Even before the meetings began, the BIT was considered one of the top issues on this year’s agenda.  The 19th round of BIT negotiations concluded earlier this month in Beijing, following a period of a year and a half, during which China developed its “negative list,” a compilation of areas it would like exempted from the BIT’s market-opening rules.  Despite the apparently slow process of the negotiations, China presented its list, the first the country has ever created, at the June round in Beijing, demonstrating its commitment to the negotiations.  The U.S. experts, led by USTR and State, are now reviewing the initial Chinese list in great detail.

A major outcome of last week’s S&ED, described as one of the dialogue’s most significant outcomes by U.S. Treasury Secretary Jack Lew, was China’s commitment to provide an updated negative list reflecting a commitment to open investment environments by September of this year.  This could be a key step in the negotiation process, moving discussions forward in a manner that will allow for an appropriately market opening agreement to benefit both negotiating parties.  The Treasury Department’s fact sheet explains that U.S. officials have made clear to China that their list of exceptions will have to be ‘very limited and narrow’, as well as ‘represent substantial liberalization’.

Adequate investment protection is indispensible for U.S. investors in China, as anywhere in the world.  While a successful BIT presents an opportunity for U.S. investors to gain access to new sectors in the Chinese market, without protections and narrowly tailored exclusions, the benefits remain limited.  USCIB’s Shaun Donnelly, Vice President of Investment and Financial Services, discussed the S&ED on a segment on CNBC last week, highlighting the importance of the investment talks.

Despite being the world’s two largest economies, and the destinations for about 30 percent of global foreign direct investment (FDI), the United States and China account for a relatively small share of one another’s FDI.  In 2014, Chinese FDI in the United States exceeded American FDI in China for the first time.  Given the size and dynamic nature of the Sino-American economic relationship, the importance of finishing these the BIT negotiations with a high-standard outcome cannot be overstated; a sub-standard agreement would do more harm than good.  Progress from the most recent round of negotiations and the outcomes of the S&ED provide much needed momentum to the process and hopefully, the United States and China can capitalize on this momentum, leading to a swift conclusion of a strong agreement.

Of course, other developments – be they positive or negative – continue to be relevant to American or other foreign investors looking at China, which remains a complex and challenging place to do business.  Even as we see signs of progress on the BIT, other developments send discouraging signals – from sectoral restrictions to a new NGO law that threatens to restrict independent business organizations in China.  The U.S. business community, including USCIB, will continue to focus on investment issues in China, working to encourage the two governments to provide clear protections and real market opening for potential investors in both directions.

This blog post was originally published on the Investment Policy Central website.