USCIB in the News: Op-ed in The Hill on UN Funding

un_headquarters_lo-resUSCIB President and CEO Peter M. Robinson published a timely op-ed in The Hill addressing recent calls in Congress to withhold or withdraw U.S. funding for the United Nations. The op-ed, reprinted below, is also available on The Hill’s website.

This op-ed comes as President-elect Trump’s top appointees, including his proposed foreign policy team, are on Capitol Hill for Senate confirmation hearings. We encourage you to share the op-ed with your colleagues and others who may be interested.


The Hill

January 11, 2017

Walking away from the UN would harm US economic interests

By Peter M. Robinson, opinion contributor

With President-elect Trump’s key foreign policy nominees facing Senate confirmation hearings this week and next, some lawmakers on Capitol Hill are threatening to withhold or slash U.S. funding for the United Nations.

This would be a bad idea, both for American power and influence, and for our economic interests. It would be especially risky for U.S. companies and workers.

My organization — The United States Council for International Business — has represented American business views to the U.N. and other international organizations for decades.

We know the U.N. sometimes fails to measure up to our expectations, particularly when it and its specialized agencies have provided a platform for anti-business views. Why do we put up with this? Why shouldn’t we just take our chips and go home?

Quite simply, because we know that no country, including the United States, can go it alone. A strong U.S. presence in the U.N. enhances our influence and our overall security.

More than ever, at a time when terrorism, cybersecurity threats, disease pandemics and refugee crises can disrupt our lives, we need the kind of platform for close international cooperation and collective action that the U.N. can provide.

This is especially true for American companies with customers, employees and operations around the world. While we may not agree with everything the U.N. does, it is simply not in our interest to withdraw support.

We in the private sector see an urgent need for the United States to stick up for its economic interests in the U.N.

For instance, in the negotiations that culminated in the 2015 Paris Climate Agreement, the U.S. had to push back hard against proposals to undermine protection for innovation and intellectual property rights, to assign historical liability for loss and damage from natural disasters, and to ban certain technologies or energy options important to U.S. energy security and climate risk reduction.

Without strong U.S. leadership, these initiatives would have carried the day, hampering American jobs and competitiveness.

At their best, the U.N. and similar bodies set global standards and develop rules that allow U.S. businesses to plan and invest.

Recent U.N. initiatives that have helped American business and our economy include agreements that support a fundamentally “hands-off” approach to the global Internet and guidelines laying out the roles and responsibilities of the private sector and governments in upholding human rights.

Moreover, the U.N. has recently developed the 2030 Sustainable Development Goals (SDGs), addressing an array of challenges, from ending global poverty and hunger to ensuring access to energy, for the next decade and beyond.

The SDGs were developed in close partnership with the private sector, which will be responsible for “delivering the goods” in many, if not most, measures of success.

So, is the U.N. perfect? Far from it, but withholding funding or walking away from the U.N. won’t change that.

Like it or not, it is part of the fundamental infrastructure for global economic activity. Like other infrastructure, the U.N. is desperately in need of repair to meet the needs of the 21st century.

If we play our cards right, this can be a century of American-led innovation and entrepreneurship. President-elect Trump’s administration should insist that the U.N. live up to its potential, defending and advancing U.S. interests in the influential world body.

Business will be there to help. Just last month, the U.N. afforded highly-selective Observer Status in the U.N. General Assembly to the International Chamber of Commerce (ICC), the business organization that represents enterprises across the globe in numerous U.N. deliberations.

This is an important sign of progress, indicating that the U.N. recognizes the need to work more effectively with business.

(Full disclosure: My organization serves as ICC’s American chapter and we pushed hard in support of ICC’s application.)

Congress should meet U.S. funding obligations and work with the Trump administration to hold the U.N. accountable to the U.S. and other member governments, as well as to economic stakeholders in the business community.

Strong engagement and leadership in the global body by the United States is an opportunity too important to lose. American security, jobs and economic opportunities are at stake if the U.S. were to indeed walk away.

Peter M. Robinson is president and CEO of the United States Council for International Business. He is an appointee to the President’s Committee on the International Labor Organization and the Secretary of State’s Advisory Committee on Public-Private Partnerships. Robinson holds a master’s degree in international affairs from Columbia University.

The views expressed by contributors are their own and not the views of The Hill.

TTIP: Now More Than Ever, We Need a Common Vision for the Future

USCIB President and CEO Peter M. Robinson
USCIB President and CEO Peter M. Robinson

By Peter M. Robinson, President and CEO, United States Council for International Business (USCIB)

This column was originally published in Echanges Internationaux, the magazine of ICC France, the French national committee of the International Chamber of Commerce.

The past year has been a disappointing one for transatlantic trade policy. More than ever, we must stand up for trade and investment, two keys for economic growth and job creation. Peter M. Robinson, President and CEO of the United States Council for International Business (ICC USA), puts forward some ideas for a common transatlantic business agenda.

Efforts by the United States and the European Union to negotiate a comprehensive, high-standard Transatlantic Trade and Investment Partnership have progressed at a disappointingly slow pace. As we near the end of the Obama administration (and look ahead to a Trump administration that promises a decidedly different approach to trade policy), TTIP has gotten mired in squabbling over a range of challenging issues and is now effectively sidelined.

These are challenging times for global companies and for major business organizations, including the International Chamber of Commerce and its national committees – such as ICC France and USCIB.

Strong, credible voices from business are more important than ever. The U.S., France and Europe more broadly all need more economic growth, more prosperity, more and better jobs. And as we in the ICC family know, one of the best ways to drive that growth is through increased international trade and investment. With that said, I would put forward the following as a common transatlantic business agenda that we can all agree on.

Keep pushing on trade liberalization

The U.S. and EU must keep pressing ahead on the important and challenging issues in TTIP. We cannot let the change of administration in the U.S., internal divisions within the EU, or other distractions deter us or our political leaders from achieving a comprehensive, ambitious, and balanced Transatlantic economic framework. TTIP was, and remains, our preferred option but that pathway seems blocked at least for the time being. It won’t be easy, and it won’t get done as fast as we’d like. But whether TTIP or some other comparable U.S.-EU agreement, it is more important to get a great agreement than to get a quick or easy agreement.

At the same time as we work to cement transatlantic ties, the U.S. and EU also need to keep providing strong leadership for the multilateral trading system, principally through support for and leadership of the World Trade Organization, which desperately needs a strong shot in the arm. The U.S. and Europe must work together to push forward an ambitious multilateral trade agenda for as we approach the WTO ministerial in Argentina in late 2017.

Work together on development

One key element of any WTO agenda needs to be a strong development pillar, designing and implementing creative ways the WTO trade regime can more effectively promote economic growth in the least developed countries, especially in Africa.

Through our “Business for 2030” initiative, USCIB had spearheaded efforts within the ICC network to provide proactive, constructive business participation in the UN Sustainable Development Goals and the 2030 Agenda. We would love to work more closely with ICC France and other leading ICC national committees in Europe on this effort, as we did successfully on the Paris Agreement on Climate Change. Our website www.businessfor2030.org provides additional information on this important effort.

Join forces on global taxation

Business needs clear, predictable, and fair tax regimes in order to plan and execute its operations. Both European and American business need to be more active, and more closely coordinated, in our participation in the G-20 and OECD efforts to reform global taxation. ICC France and USCIB actively engaged in the OECD’s Base Erosion and Profit Shifting (BEPS). We cannot allow the BEPS effort to get hijacked by those with an anti-business agenda.

Keep global organizations “open for business”

Unfortunately, some international organizations in the UN family are becoming hostile to the private sector, seeking to exclude business representatives from key meetings and to impose an anti-business agenda. Leading U.S. and European business groups, and the global ICC network, need to confront that discrimination, while actively supporting and growing the mutually beneficial relationships that do exist after over 70 years of consultative status with various UN agencies.

I have laid out a long and challenging agenda. I very much look forward to working with François Georges and his dynamic team at ICC France in all of these important areas. We have a lot to do, and a lot more that we can do together. Let’s get to work.

USCIB Statement on the U.S. Election Results

Trump announces security policy in Philadelphia, PennsylvaniaNew York, N.Y., November 9, 2016Terry McGraw, chairman of the United States Council for International Business (USCIB) and Peter Robinson, USCIB’s president and CEO, released the following statement on the results of the U.S. election:

“We congratulate Donald J. Trump on his election as our next President. It has been an intensely hard-fought campaign, and we look forward to Americans coming together behind shared values and a common purpose. We also congratulate the members from both parties elected to both houses of the 115th Congress.

“It is important for the United States to remain engaged globally and provide leadership on a range of issues affecting our national prosperity, including international trade, climate change, sustainability and support for a rules-based global economy.

“American companies are heavily invested in creating the conditions for expanded U.S. influence internationally and renewed investment and growth at home. USCIB is eager to work with the new Administration and Congress – and with the overseas business partners with whom we have established longstanding close ties – to focus attention on the key issues and initiatives that will undergird America’s growth and success, and strengthen the global economy, in the 21st century.

“The next Administration faces numerous challenges as it takes office. A top priority should be to develop and implement, in concert with the Congress, a strategy for U.S. engagement with the wider world – one that both continues and augments the benefits that American businesses, workers and consumers draw from active participation in the global economy and international institutions. We need policies that anticipate, address and support the demands of a changing American workplace, while addressing the legitimate needs of those displaced or disadvantaged by the 21st-century global economy.

“Such a strategy must recognize and build upon America’s strengths in innovation, entrepreneurship, world-class work force and know-how. It should further seek to leverage American business to reinforce U.S. global leadership, and effectively engage with multilateral institutions to foster international rules and a level playing field that support our competitiveness. It should also seek to make these institutions more accountable and representative of key global stakeholders, including the private sector, in pursuit of shared goals and values.

“We are ready to work with the new Administration and Congress to strengthen U.S. competitiveness, reap the gains from participation in global markets and trade, and deliver benefits in the form of jobs and opportunities for U.S. workers. These objectives can and must be pursued together.”

About USCIB:
USCIB promotes open markets, competitiveness and innovation, sustainable development and corporate responsibility, supported by international engagement and regulatory coherence. Its members include U.S.-based global companies and professional services firms from every sector of our economy, with operations in every region of the world. As the U.S. affiliate of the International Chamber of Commerce, the International Organization of Employers, and Business at OECD, USCIB provides business views to policy makers and regulatory authorities worldwide, and works to facilitate international trade and investment. More information is available at www.uscib.org.

Contact:
Jonathan Huneke, VP communications, USCIB
+1 212.703.5043 or jhuneke@uscib.org

Talking Up Trade in an Election Year

By Peter M. Robinson

The presidential candidates are distorting the facts about trade and jobs. We all need to push back.

USCIB President and CEO Peter Robinson
USCIB President and CEO Peter Robinson

To hear many of the contenders for the White House tell it, international trade is a dead end. There have been numerous memorable quotes from both sides of the aisle that I won’t dignify by repeating here. Nearly all the candidates say the Trans-Pacific Partnership needs to be scrapped or renegotiated.

Such rhetoric, coming from politicians who use it to convince people to vote for them, is extremely disturbing. Why? Because it is distorting the facts about trade and jobs! While the anti-trade diatribes coming from the campaign trail tap into a tangible belief among many disaffected voters that trade policy and the economy in general are rigged against them, they fly in the face of a recent Gallup poll that reports that Americans continue to believe—by a wide margin, 58 to 34 percent—that international trade presents an opportunity rather than a threat.

We in the business community have a responsibility to remind people – including our political leaders – of the facts, and cut through the hyperbole. We need to speak out to help our employees, our shareholders and the communities we operate in understand that the world is growing around us, and that we cannot – nor can other countries – afford to turn inward.

Page2_GallupThe fact is, expanded trade over the past two decades has boosted annual U.S. income by about ten percent of GDP – thousands of dollars per household – relative to what would have been otherwise. A study from the Peterson Institute for International Economics says the United States stands to be a big winner – the biggest winner – from the TPP, with income gains of some $130 billion by 2030. This growth is essential if we are to meet our goals in terms of new and better jobs, and an expanded middle class.

U.S. negotiators drove a hard bargain in the TPP talks, and – while no one, including the business community, got everything they wanted – we came away with an agreement that puts our most competitive industries, and the people they employ, in a good position for strong growth in the burgeoning Asia-Pacific marketplace. This is good news for American workers, since export-oriented companies pay, on average, 18 percent higher wages than their non-exporting counterparts.

It is also important to remember that trade liberalization serves an important geopolitical role, cementing U.S. leadership and a safer, more prosperous world – one where we can address common challenges like tackling climate change, fighting terrorism and lifting people out of poverty. In today’s world, everyone benefits when America leads.

We should take anxiety over trade seriously. But the gains from an agreement like TPP far outweigh the costs. And jobs lost to trade as a result of the agreement can and should be addressed via enhanced Trade Adjustment Assistance, something the business community has long supported. We also need to acknowledge that job dislocation is being spurred by technological advances and corresponding transformative disruptions.

An important priority will be connecting necessary skills development to the jobs of tomorrow. And as World Trade Organization Director General Roberto Azevedo has observed, increased trade, by boosting income and creating better jobs, can play an important role in raising skills and reducing inequality, both within countries and across borders.

Boosting investment for the future

To meet both the opportunities and the demands of the 21st-century economy, the United States needs a comprehensive approach to invest in enhanced competitiveness. Such an approach should encompass serious efforts to improve education and training, rebuild our infrastructure, reform the tax code and improve our regulatory environment.

We also need to invest in future agreements to open up markets for American goods and services. In this regard, it is extremely important to promote open and well-functioning investment policies and regimes. Private investment, in addition to traditional trade, will be a critical factor in the years to come.

At every opportunity, USCIB has sought to demonstrate the positive economic benefits of foreign direct investment – both inbound and outbound – for the American economy. A 2013 report by Professor Matthew Slaughter of Dartmouth, commissioned by USCIB and the Business Roundtable, demonstrated convincingly that U.S. companies who grew their overseas operations to access foreign markets exported more, and provided more and better jobs at home.

USCIB is working hard to address barriers to investment abroad, both in trade agreements like TPP and international organizations that design rules of the road for their member governments. Our members continue to face policy and regulatory barriers that inhibit entry into specific markets, and impede their ability to design, produce, market and distribute their products globally. Unlocking their ability to invest and compete abroad will be critical to American success in the 21st century, leading to sustainable enterprise and job creation.

In a recent op-ed in The Wall Street Journal, Professor Slaughter and Morton Kondracke, the former executive editor of Roll Call, posed the question: “Who will step up to tell the compelling trade story that America needs to hear?”

We, for one, will. And I hope that we can count on everyone in USCIB’s membership to join us and our partners in the broader pro-trade community, in Washington and around the world, to make the case for international trade, and for investing in the future of our country.

Enabling a Vibrant Digital Economy Is Essential for 21st Century Business

Digital GlobeSeveral years ago in this column, I remarked on the amazing transition from e-commerce to the “Internet economy.” Nowadays, it is clear that the digital economy, for all intents and purposes, is the economy. Very little commerce, both in-country and across borders, could take place without the interconnected networks enabled by the global Internet. Think about how your business would function for even a day without reliable access to modern information and communication technologies (ICTs).

The OECD, which has served as an invaluable forum for discussion of sensible policy approaches to the challenges and opportunities presented by the digital economy, is gearing up for a ministerial meeting this June in Cancun, Mexico. The meeting will explore work undertaken by the OECD Committee for Digital Economy Policy to address the continued evolution of the digital economy in the eight years since a previous 2008 ministerial in Seoul, South Korea. USCIB and our members played an active role at the Seoul ministerial, where I had the privilege of serving as chair of the “business day” events.

The Seoul ministerial acknowledged the essential nature of the Internet as a platform for economic growth, and emphasized the need for all stakeholders to guide its development. Recognizing the vast changes in this area since 2008, the Cancun ministerial will highlight the extent to which the entire economy has become digitized, and explore how this transformation has affected social interactions, business and government operations, laws and regulations, and jobs and skills. Numerous USCIB and other global companies are set to participate.

Privacy and localization concerns

The Cancun ministerial comes against the backdrop of growing unease in some markets over privacy protections for cross-border data transmissions. The European Court of Justice got everyone’s attention recently when it invalidated the European Commission’s 2000 decision concerning the adequacy of the existing transatlantic “safe harbor” framework. In the past 15 years, thousands of U.S. companies have used this framework to ensure that their data practices are in line with European Union privacy rules.

Addressing the 2016 Consumer Electronics Show in January, Federal Trade Commission Chairwoman Edith Ramirez said she was confident that U.S. and EU officials would reach agreement on a new data transfer deal – a so-called Safe Harbor 2.0, which is essential for the global operations of both tech and non-tech companies. As we went to press, however, there was still no agreement, and the clock was ticking loudly toward a January 31 deadline imposed by EU Data Protection Authorities (DPAs). The DPAs indicated that if U.S. and EU negotiators do not conclude Safe Harbor 2.0 by that date, they may launch probes of U.S. tech companies to ensure compliance with European law. Such actions could have a severe chilling effect on transatlantic data flows, with potentially devastating consequences for both the U.S. and EU economies.

A related development is rising support for the forced localization of data centers within a country’s border. As USCIB members have made clear in numerous forums, such requirements diminish the investment appeal of these markets by creating undue burdens for global companies. Localization requirements also threaten ground-breaking ICT advances – with promise of significant economic and societal benefits for these countries – in such areas as cloud computing, use of Big Data and the Internet of Things. Also important (and ironic), data localization measures effectively undermine privacy and security by distracting from efforts to create better protections for individuals and generally making these markets more vulnerable to hackers.

More generally, we are seeing a proliferation of other types of localization barriers, such as local content requirements, discriminatory government procurement practices, technology transfer requirements and other policies and regulations aimed at promoting domestic industry and shielding it from foreign competition.

Wise policy choices needed

A vibrant digital economy holds great promise for individual businesses and the global economy more generally. Many countries realize this, but in their efforts to harness the innovative and developmental potential of an Internet-fueled economy, they are resorting to policies that risk quashing that vibrancy.

During last year’s review of the decade-old World Summit on the Information Society (WSIS), an initiative launched under UN auspices, we also heard calls from some countries for a stronger government role in governance of the Internet. Such an approach would undermine the bottom-up, multi-stakeholder approach to Internet governance. When governments work together with other stakeholders, we can realize significant progress in raising capacity, knowledge, and understanding of digital economy issues. Policymaking invariably is improved when representatives of business, the technical community, and civil society inform such discussions; such inclusion also helps to lower the risk of unintended consequences.

The upcoming OECD ministerial provides the perfect opportunity for the business community to tell lawmakers which policies best realize the promise of Internet-enabled development and innovation. USCIB seeks a ministerial outcome that recognizes the importance of private-sector investment and “light touch” regulation that preserves the Internet’s interoperability. We would also like to see the OECD highlight how emerging technologies facilitate economic development and address societal needs. And collaboration between all stakeholders is a must in order to expand inclusion in the digital economy.

USCIB addresses these issues at a global level through our unique role as U.S. affiliate of the International Chamber of Commerce (ICC) and of BIAC, the Business and Industry Advisory Committee to the OECD. We are lucky to have strong member support and leadership from individuals such as Eric Loeb (AT&T) and Joseph Alhadeff (Oracle), chair and vice chair, respectively, of our ICT Policy Committee. (Alhadeff also chairs the corresponding committees at ICC and BIAC.)

I am confident that USCIB and our members will have robust representation in Cancun. And I am equally confident that policymakers will recognize the Internet’s role as a platform for innovation, social inclusion and economic development. With your continued strong support, USCIB and our members can continue to drive industry leadership in this critical area; ICTs are essential for doing business in the 21st century.

USCIB at the United Nations

un_headquarters_lo-resHere in New York, September was a high-profile month, not only for heads of state, but also for business where USCIB, along with our colleagues at the International Chamber of Commerce (ICC), was in the thick of things during the United Nations General Assembly.

Prior to the opening of this year’s session, country leaders and other important actors gathered for two events of critical importance for business: UN Climate Week and the Sustainable Development Goals (SDGs) Summit. After two years of slow-moving and intricately detailed negotiations, countries agreed the UN 2030 Development Agenda, which includes 17 Sustainable Development Goals. They also highlighted the critical importance of a successful outcome at this December’s UN Climate Summit in Paris.

In both these arenas, USCIB has been involved every step of the way. It is clear that both initiatives will impact the private sector, while also providing many opportunities for business to contribute. Because of this, our stepped up advocacy and communications activities this year on both climate change and the SDGs have been carefully planned and strategically managed under our Campaign 2015 initiative.

Our key messages have been consistent – as well as insistent. Both in the negotiations leading to the SDGs and in the climate change negotiations, we have underscored the need for business to be embedded in the process. This is necessary to leverage the full resources that we can bring to the table – through investment, innovation and know-how. We have also sought to ensure that expectations of the private sector’s contributions are reasonable, and in line with business and economic realities. I believe this steady drumbeat of private-sector messaging is beginning to pay off.

Business for 2030 showcases company initiatives

I am especially proud of the launch of our Business for 2030 web portal, which makes a critical contribution to the 2030 Agenda by showcasing corporate programs and initiatives supporting each of the 17 SDGs (see page 3). Co-sponsored by Bechtel, MasterCard and IFPMA, our event attracted a diverse, standing-room only crowd of corporate, governmental, IGO and NGO representatives. We were honored to have UN Ambassador Amina Mohammed, the architect of the Sustainable Development Goals, as our opening speaker. Another leading figure in international development, Erik Solheim, executive director of the OECD Development Committee, delivered closing comments.

The Business for 2030 portal has already received widespread acclaim, and it has been designated by the UN as an official portal for identifying corporate contributions to the SDGs. This is a remarkable contrast to the “cold shoulder” business got in the development of the Millennium Development Goals 15 years ago.

All eyes now on implementation – and on Paris

USCIB has worked closely with the UN system, the U.S. government and other business groups to shape the SDGs, and has identified priority issues for business attention and engagement. To date, however, the access and involvement afforded business in the deliberations has not been commensurate with the high expectations for private-sector resources and action. We are working to change that as attention now shifts to putting the SDGs into practice at the national level.

I have been extremely impressed with the commitment and determination shown by USCIB members to help guide and inform the UN’s work on the 2030 Development Agenda. Special thanks and recognition go to Ann Condon of GE, chair of USCIB’s Environment Committee, and to Tam Nguyen of Bechtel and Brian Lowry of Monsanto, co-chairs of our SDGs Working Group.

The new UN agenda will shift the terrain for much of USCIB’s work, and we appreciate the encouragement and support we have received to continue to take a pro-active role, expressing USCIB’s vision and raising USCIB’s visibility. We will continue to work hard to inject business views into the implementation phase, especially at the national level, utilizing USCIB’s unmatched global business network.

We are now gearing up for the next critical step in the Campaign 2015 program: the COP21 climate negotiations in Paris. In October, I helped represent U.S. business in Tokyo at the Second Innovation for Cool Earth Forum (ICEF2), a high-level conference organized by the government of Japan for business, government and academics to discuss the important role of innovation and technology in addressing climate change. While in Tokyo, I also participated in the High Level Business Dialogue organized by Laurence Tubiana of the government of France; the invitation to join this influential consultation with government ministers on technological solutions and their deployment is further recognition of USCIB’s reputation and expertise in the process. We also participated in the final round of UN climate negotiations in Bonn.

And now it is on to Paris!

The Business of Sustainability

USCIB President and CEO Peter Robinson
USCIB President and CEO Peter Robinson

Think the UN is all talk and no action? Think again. Two upcoming conferences could radically alter how business is done around the world.

By the end of this year, two highly anticipated UN deliberations will have altered the course of global policy and regulation. Taken together, September’s UN General Assembly session – where member states will finalize the UN’s long-awaited Sustainable Development Goals (SDGs) – and December’s COP21 climate summit in Paris will shift markets and expectations of the private sector, and impact U.S. companies for years to come.

At the same time, critical negotiations on finance, investment and trade are unfolding that seek to mobilize business resources for climate and sustainability. These include July’s UN Financing for Development conference in Addis Ababa, Ethiopia, and talks on a WTO Environmental Goods Agreement. As these processes move forward, we are seeing increasing momentum, activity and heightened expectations, not just for governments but also for the business community.

This is because, unlike previous UN talk shops, these deliberations have catalyzed political leaders around the world toward action. Governments are already moving ahead. The United States, Brazil and China have all announced new ambitious greenhouse gas reduction targets. In Addis Ababa, governments will commit to global economic and development policies that seek to mobilize both public-sector and private-sector financial resources in support of development.

So what is the role of U.S. business in these global debates? This depends in large measure on what our government and the UN agencies involved want – and allow – companies to do. But to a substantial degree, it is also up to American business to define and shape its role in the systems and policy frameworks that will emerge from the SDGs and COP21.

Make sure agreements work with – and for – the private sector

We have an important message to deliver to policy makers: The private sector, not government, is responsible for the lion’s share of investment decisions around the world that will finance sustainable development and climate amelioration. It is business that develops, and deploys, the technologies that will surmount current sustainability challenges. The success of the SDGs and the COP21 agreement hinges on open markets and a level playing field. These have been core guiding principles of USCIB and our business partners for decades, and they are more important now than ever before.

As a responsible partner of long standing representing U.S. companies in intergovernmental agencies, USCIB has been deeply involved in all these deliberations. Our members know how important it is to find solutions that work with the private sector, and in synergy with global markets, to foster shared prosperity through innovation and investment.

Undeniably, business can, and should, lead in the transition to a more climate-friendly and sustainable economy, while improving world health and eradicating poverty and hunger. For this to happen, the policy frameworks governments put in place in via the SDGs and a global climate pact must be practical, and must consider how  the private sector’s involvement can get us all to the finish line more quickly, without compromising economic growth and prosperity or creating undue burdens on business.

Launch of Campaign 2015

campaign2015_logoJust as political leaders are catalyzing around the need for action, USCIB is rallying American business in a constructive, coordinated effort to provide a stronger private-sector role in the SDGs, COP21 and related initiatives. We have launched a new initiative, Campaign 2015, to serve as a linchpin for our work in these critical negotiations.

Through Campaign2015, USCIB will:

  • represent business interests in real time at global negotiations, ensuring business is at the table when these ambitious agreements lead to binding regulations
  • champion and amplify USCIB’s messagesthrough dedicated meetings with key policymakers
  • promote the opportunity for business investment, action, collaboration and innovation, and
  • communicate our policy views to influential audiencesby leveraging media attention around UN deliberations.

We have created a new Web platform www.BusinessForPost-2015.org, to showcase the private sector’s contributions to sustainable development and explain what the SDGs mean for business.  We are also engaging in a media campaign with Devex, the leading online platform for development professionals, to highlight our policy work and priorities for the post-2015 development agenda.

Our efforts through Campaign 2015 will challenge us to extend our reach and amplify our voice in new ways. More than visibility, this initiative provides business a seat at the table to inform, advise and engage throughout the negotiation processes to encourage member state representatives to enact policy frameworks that safeguard sustainable economic growth and resist negative proposals, such as those that will weaken intellectual property protection.

The bottom line is that business must be a part of the process if it is to be a part of the solution.

To learn more about Campaign2015 or to make a contribution, please visit www.USCIBCampaign2015.org, or contact Norine Kennedy at nkennedy@uscib.org.

 

What Has Changed in the Climate Change Talks?

If a global climate agreement doesn’t work for business, it won’t work.

USCIB President and CEO Peter Robinson
USCIB President and CEO Peter Robinson

Following another finish in “overtime,” the annual UN climate change conference wrapped up in Lima, Peru on December 13. This was the 20th Conference of the Parties to the UN Framework Convention on Climate Change, or UNFCCC, and one could be forgiven for a sense of déjà vu. After all, we have become accustomed to the inevitable cliff-hanger ending of these annual “COP” meetings, just as we have come to depend on a last-minute compromise.

The Lima meeting’s purpose was to set the stage for the home stretch of negotiations of a long term inclusive climate agreement to be finalized next December in Paris. Yet despite a modest agenda, it proved extremely difficult for member states to agree to even a brief five page outcome document. In my view, this means we should not be too complacent as we look ahead to 2015. Much has changed since the international community negotiated the Kyoto Protocol in 1997, and business has a lot on the line.

Negotiators did make progress in framing commitments to lower greenhouse gas emissions and fund developing countries’ climate efforts. I attended alongside USCIB’s Norine Kennedy and many dozens of USCIB member executives and representatives of our global business network. Our colleagues from the International Chamber of Commerce played an important coordinating role, facilitating private-sector engagement across the board in Lima.

This was my fourth COP, and a major difference I noticed from prior meetings was while governments still face gaps and differences in opinion, positions put forward by business groups are converging in three key areas that are – in USCIB’s view – deal-breakers for the future of the agreement.

Commitments and Transparency

The climate agreement to be signed in Paris must provide a clear framework for international cooperative action, committing all large emitting economies to the measurement, monitoring and reporting of nationally pledged activities to control and reduce greenhouse gas emissions, such as those announced recently by the United States and China.

UN negotiators needed to reach agreement on credible measuring, reporting and verification for all national commitments to ensure transparency and assess progress going forward. In Lima, China and a number of other, largely developing, countries resisted measurement and reporting tools to ensure that countries are living up to their commitments.

Financing and Investment

We need to leverage private investment if we are to have any hope of marshalling the $100 billion in annual financing that UNFCCC parties say is required to ensure adequate resources for climate mitigation and adaptation. Yet governments seem stuck in the same old “aid, not trade” mindset. The UN’s Green Climate Fund, designed to finance developing countries’ efforts to combat climate change, did reach its initial $10 billion capitalization target. But going from $10 billion to $100 billion depends on the mobilization of private investment and innovation.

Negotiators must now work toward a 2015 Paris agreement with measures that enable markets and foster business investment – as well as government aid – aimed at reducing greenhouse gas emissions and adjusting to climate impacts. The UNFCCC should promote innovation through financially efficient and well-targeted support mechanisms to scale up new technologies and strong, protection of intellectual property.

Private-Sector Engagement

If a global climate agreement doesn’t work for business, it won’t work. This was the message my colleagues and I delivered repeatedly in Lima. With so much riding on economy-wide transformational change that will rely on the private sector, the Paris outcomes must anchor the role of business in the UN climate agreement through actions to reduce emissions, pursue efficiency, transform energy systems and build more resilient infrastructure.

We made some progress on this front. Our well-attended BizMEF Lima Dialogue (see photo) won praise for engaging with key governments and other stakeholders in support of securing the private-sector commitment and expertise that can drive meaningful change. Given the wide impact that a UN agreement will have on markets, regulations and national competitiveness, an agreed and recognized structure is needed to provide business expertise and support.

UN negotiators should make space for a business consultative channel as a resource of technical and practical expertise for governments and the UNFCCC process.

So where does this leave us, with one year to go before the big Paris climate summit? The challenge of climate change is real on economic, environmental and social fronts, with opportunities for business in new markets and for the global community to enable climate friendly development and energy access.

Negotiators have a lot of work to do between now and next December. Have they bitten off more than they can chew? I think not, but getting this agreement past the finish line will clearly require pragmatic problem-solving and engagement with the private sector. Business innovates and invests in ways that the public sector can’t, and tapping into that innovation could well be the difference between success and the same old same old in Paris next year.

Peter Robinson’s bio and contact information

Other recent postings from Peter Robinson:

What’s the Rush on Global Tax Reform? (Summer 2014)

Setting the Rules of the Road in Cross-Border Commerce (Spring 2014)

It’s Time to Clap with Both Hands on FDI (Winter 2013-2014)

Making Sure the Business Voice Is Heard in International Agencies (Fall 2013)

Now Is the Time to Stand Up for Trade and Investment

Trade is like a bicycle – it needs forward momentum to avoid falling over.

USCIB President and CEO Peter Robinson
USCIB President and CEO Peter Robinson

Last March, President Obama issued his 2014 U.S. Trade Agenda, which outlined ambitious priorities for expanding American trade and investment around the world, in support of expanded job growth and enhanced U.S. competitiveness. Part of the trade agenda’s ambition lay in an “all of the above” approach – that is, the United States would move forward on major bilateral, plurilateral and multilateral efforts to expand cross-border commerce, while securing bipartisan support for renewed Trade Promotion Authority (TPA) in Congress. We at USCIB applauded loudly and set about drumming up private-sector support.

More than six months on, while some progress has been made, I fear that we face a number of disappointments, potential setbacks and stiff challenges that have served to undercut the administration’s ambitions and the broader cause of expanded trade. Consider these developments:

  • In July, a small group of countries led by India blocked implementation of the World Trade Organization’s Trade Facilitation Agreement, which was agreed last December at the WTO ministerial in Bali. This has sent the organization into yet another crisis, putting the brakes on the WTO’s whole post-Bali agenda.
  • Unfounded anxiety, some might say hysteria, has sprung up in Europe over certain aspects of the Transatlantic Trade and Investment Partnership (TTIP), such as the same strong investor-state dispute settlement provisions that already exist in numerous U.S. and European commercial agreements. The hysteria is threatening to upend these crucial negotiations, and could complicate efforts to negotiate a U.S.-China bilateral investment treaty.
  • Several countries, including the United States, are threatening to carve out certain sensitive areas from liberalization commitments under the Trans-Pacific Partnership (TPP), as well as in the TTIP negotiations.
  • TPA legislation remains stalled on Capitol Hill, captive to Washington’s increasingly polarized, partisan divide.

All this is deeply disappointing. Expanding trade and investment is essential for economic growth and job creation. Indeed, the International Chamber of Commerce (ICC) and the Peterson Institute for International Economics estimate that the trade facilitation agreement alone would create 21 million new jobs worldwide. More broadly, it is increasingly clear that freeing up cross-border trade and improving conditions for FDI must be part of critical global efforts to address climate change and promote sustainable development.

After investing so much time and effort to champion the pro-trade consensus that now seems to be fraying, we in the business community have every right to be frustrated. Yet we must try to help our political leaders around the world pick up the pieces and get back to the negotiating table in Geneva, summon the courage to stand up for an ambitious approach to the TPP and TTIP negotiations, and move forward – after lengthy delays – on Trade Promotion Authority.

With that in mind, in October I joined USCIB (and ICC) Chairman Terry McGraw and ICC Secretary General John Danilovich in Geneva at the World Investment Summit. Convened by the UN Conference on Trade and Development, the summit was an important opportunity to look at how FDI can be leveraged for sustainable development, economic growth and jobs. In addition, both John and Terry have spearheaded an aggressive global campaign to help get the WTO back on track.

As this issue of International Business went to press, we joined with the OECD and its Business and Industry Advisory Committee (BIAC) to organize a high-level conference in Washington, D.C. on new directions in trade and investment policy. The October 30 event showcased groundbreaking policy-related research from OECD on the rise of global value chains, trade in services and other aspects of the 21st-century global economy. We hope that the fresh ideas and new perspectives offered at the conference will help demonstrate the importance of moving forward to tackle today’s most pressing trade and investment barriers.

USCIB continues to play a leadership role pressing for strong, market-opening commitments in TPP and TTIP. We are also working closely with a broad-based business coalition to move forward on TPA. The old saying still holds: trade is like a bicycle – it needs forward momentum to avoid falling over. That is why it is more important than ever for business around the world to keep up the pressure on our political leaders to implement the Bali package, strive for ambitious, high-standards agreements with Asia and Europe, push ahead to negotiate a high-standard U.S.-China bilateral investment treaty, and get off the dime to pass meaningful Trade Promotion Authority.

Peter Robinson’s bio and contact information

Other recent postings from Peter Robinson:

What’s the Rush on Global Tax Reform? (Summer 2014)

Setting the Rules of the Road in Cross-Border Commerce (Spring 2014)

It’s Time to Clap with Both Hands on FDI (Winter 2013-2014)

Making Sure the Business Voice Is Heard in International Agencies (Fall 2013)

From the President: What’s the Rush on Global Tax Reform?

In their haste to tackle “base erosion and profit shifting,” governments risk fostering the kind of unilateral action they are seeking to avoid.

peter-robinsonLast year, responding to concerns that multinational firms take advantage of gaps in the global taxation system to move income to lower-tax jurisdictions, the leaders of the G20 endorsed a plan put forward by the Organization for Economic Cooperation and Development (OECD) to counter what governments called “base erosion and profit shifting,” or BEPS.

This acronym has quickly risen to the top of many CEOs’ “worry list,” and made the annual tax conference we organized with the OECD in June (see story on page 3) even more popular than usual this year. But what’s behind the sudden rush to action in an area as contentious and fraught with complexity as global tax policy? And what might happen if governments get it wrong?

What constitutes “tax abuse”?

Tax is not a moral issue. Indeed, the OECD and others have said repeatedly that tax planning – including planning that results in base erosion and profit shifting – is entirely legal. Companies do not abuse the system by taking advantage of legal methods of reducing their taxes. Corporate tax reduction strategies have, however, caught the attention of politicians (and the public) at least in part because of the financial crisis and the resulting fiscal consolidation. There is – and should be – a policy debate about the appropriate level of corporate income taxes.

Each country has a sovereign right to make decisions about the amount of revenue it collects, and from whom. Indeed, the ability to make decisions about taxing and spending is a core element of statehood, and a country cannot give up that ability without surrendering its sovereignty. So, taxing rights are jealously guarded by countries. What then is the function of the OECD or any other multilateral organization in this core function?

In order to promote international trade and investment, countries need agreed-upon rules of the road to determine which country has taxing rights to how much income when goods or services cross borders. If there is no agreement, then uncertainty and double taxation will reduce trade and investment. The BEPS project arose out of concern that the rules for eliminating double taxation have gone too far and the pendulum needs to swing at least part of the way back.

It is important, however, to maintain sound principles for determining when a foreign company is subject to tax within a jurisdiction and how much of its income is subject to tax. Although the existing principles do not work perfectly, they have facilitated the development of cross-border trade and investment, and should not be abandoned lightly or in the absence of a new consensus. Any new consensus must be a true, detailed consensus where countries agree not just on a string of words, but on the meanings of those words.

Race to the finish line?

The first group of projects is now heading towards completion. These projects include work on intangibles as well as such seemingly esoteric topics as country-by-country reporting, tax treaty abuse, hybrids and the arm’s length principle. In today’s modern, highly integrated global economy, these issues are crucial for the operations of multinational companies and the administration of national tax systems.

While the OECD does not have legislative authority, there is substantial political will behind the BEPS project and wide support from the G20 countries, which are participating in the process on an equal footing with OECD member countries. But getting to a fair and reasoned outcome on a 24-month deadline is challenging, given the scale of its ambition and critical need for a consultative process with BIAC and other stakeholders to work toward consensus.

That’s why business must engage positively with the OECD, recognizing the public and political momentum behind change, and the continuing danger of unilateral action if the BEPS action plan falters. Moreover, there are many other pressing tax issues for U.S. legislators and policy makers. The challenge is to pursue these in concert with the reforms being undertaken via the BEPS process, with the goal of creating a simpler, fairer and more competitive tax system for everyone.

Peter Robinson’s bio and contact information

Other recent postings from Peter Robinson:

Setting the Rules of the Road in Cross-Border Commerce (Spring 2014)

It’s Time to Clap with Both Hands on FDI (Winter 2013-2014)

Making Sure the Business Voice Is Heard in International Agencies (Fall 2013)

A Trade Policy Renaissance (Summer 2013)