Op-Eds and Speeches Archives

Bit-by-Bit Won’t Get it Done on US-China BIT Negotiations

Published on September 15, 2015

by Shaun Donnelly, USCIB’s vice president for investment and financial services

When Chinese President Xi Jinping visits Washington later this month for what may well be the final full-blown U.S.-China summit of the Obama administration, there will be a lot of important bilateral and global issues on the agenda – cyber security, South China Sea, democracy and human rights, climate change, Internet freedom, North Korea, Iran, Syria and a whole lot more.  But I want to make a strong plea that the U.S. and Chinese governments also use this upcoming summit to push for real breakthroughs on the long-running U.S.-China negotiations on a bilateral Investment treaty – the “U.S.-China BIT.”

The U.S.-China BIT has the potential to be a win-win agreement to provide broad legal protections, market-opening and dispute settlement mechanisms for foreign direct investment (FDI) flows in both directions. China already has over 100 BITs with other nations, so current and potential U.S. investors are presently at a disadvantage in competing for investment opportunities in China’s fast-growing economy.  And make no mistake, this is not a one-way street; Chinese investors are already investing, and looking to invest more, in the U.S., which we should welcome to help increase investment, jobs and economic growth here at home.

Continue reading the full post on Investment Policy Central.

TPP: A 21st Century Trade Agreement

Published on September 14, 2015

by USCIB President and CEO Peter Robinson

Golden_GateLike many in the U.S. business community and other key stakeholders, we at USCIB and our member companies are eagerly anticipating a successful and swift conclusion to the long-running Trans-Pacific Partnership (TPP) negotiations. We are encouraged by senior White House National Economic Council official Carolyn Atkinson’s suggestion last week that a successful conclusion may be imminent.

Experience dictates that the endgame of any international negotiation is always more complicated, more challenging and less predictable than foreseen. However, getting a comprehensive, ambitious, high-standard TPP agreement over the finish line is absolutely a top priority for our organization and our member companies. A strong TPP is good news for American workers, companies, communities and taxpayers.

From what I have heard about the prospective TPP agreement, I am forcefully reminded how different this agreement will be from other trade agreements that have gone before. We love NAFTA, CAFTA and the network of bilateral and plurilateral FTAs the U.S. has built over the past 30 years. They have paid tremendous dividends for our country. But it is not just for semantic reasons that the TPP is branded as a “Partnership.” rather than a “Free Trade Agreement”; the TPP goes well beyond a traditional FTA.

Continue reading the full post on Investment Policy Central.

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.

 

Letter in New York Times on Trade and Climate

Published on June 16, 2015
USCIB President and CEO Peter Robinson at a press conference in Lima, Peru on December 8. “If a global agreement on climate change doesn’t work for and with businesses, it just won’t work,” he said.
USCIB President and CEO Peter Robinson at a press conference in Lima, Peru on December 8. “If a global agreement on climate change doesn’t work for and with businesses, it just won’t work,” he said.

USCIB President and CEO Peter Robinson has a letter in today’s issue of The New York Times on climate change and trade policy. The letter is reproduced below, and you can view it on The Times’ website by clicking here.

Robinson rebuts a recent piece by Times columnist Eduardo Porter that suggested border taxes on products from countries outside a so-called “climate club,” saying that countries should instead offer trade incentives, rather than punitive tariffs, to reduce carbon emissions and spur the deployment and use of greener energy technologies.

This letter is especially timely, as it comes after the most recent negotiating session of the UN climate change talks in Bonn, where USCIB played an important role in voicing private-sector views. Click here to read our report. It also comes as we gear up for next week’s climate-focused meeting of USCIB’s Environment Committee and the North American Business Climate Consultation, held in conjunction with the International Chamber of Commerce and the Canadian Chamber of Commerce.

Finally, USCIB continues to advance American business interests in the WTO’s Environmental Goods Agreement talks as well as other key trade negotiations, even as we grapple with the current trade deadlock on Capitol Hill.

—

The New York Times

June 15, 2015

The Opinion Pages/Letters

Climate Change and Trade Policy

To the Editor:

Eduardo Porter advocates launching a trade war as a way of ”solving” the climate challenge (”Climate Deal Badly Needs a Big Stick,” Economic Scene column, June 3), imposing tariffs on those countries that don’t join a ”climate club” committed to reducing carbon emissions.

But we should offer carrots instead of sticks to accelerate the transition to greener energy. Rather than threatening higher-emitting countries with punitive tariffs, we should roll back barriers to trade in environmental goods and services.

There is no contradiction between economic development and climate protection. Indeed, as countries grow richer, they can devote additional resources to cleaner energy.

To be viable, climate solutions must factor in real-world needs, including the need for economic growth, and deliver benefits today to people in both rich and poor countries.

And they need to be in line with political and market realities, including the global community’s common interest in keeping markets open and economic relations cordial.

The ”big stick” that Mr. Porter endorses fails to meet these criteria.

PETER M. ROBINSON
President and Chief Executive
United States Council for International Business
New York

Climate policy embraces a range of approaches

Published on June 3, 2015

Financial Times

Letters

Sir, It is unfortunate that Pilita Clark and Ed Crooks present the call from leading oil and gas firms for the widespread introduction of carbon pricing mechanisms in the context of a supposed transatlantic schism (News, June 1). In reality, the prevailing international business view is somewhat more nuanced than it might at first seem.

The anticipated Paris climate agreement will combine a broad range of national and local approaches to combating climate change in what will be a novel form of “bottom-up” global architecture. Carbon pricing instruments (Letters, June 1) can certainly play an important role in spurring emissions reductions in those countries or regions that choose to use them; but it is important to recognise that they are just one part of the policy mix. While carbon pricing may be the most cost-effective climate solution in some countries, other approaches — such as incentive-based systems or efficiency standards — may be a more viable option elsewhere. What’s more, carbon pricing schemes also need to be carefully designed to promote a global level playing field for commerce and to enable future trade-driven growth.

This leads to an important secondary point: the intervention from leading European energy firms is illustrative of a broader effort on the part of the private sector to engage constructively in the development of climate policy. That’s why leading business networks called last month — at the conclusion of the first-ever Business and Climate Summit — for governments to establish a recognised consultative role for the private sector under a future climate accord. Better harnessing of business know-how would be a significant step forward in the way we go about addressing the shared challenge of climate change — irrespective of the specific policy instruments employed.

John Danilovich
Secretary-General
International Chamber of Commerce
Paris, France

On trade, time for US to play offense

Published on March 9, 2015

The Hill – March 9, 2015

An op-ed by USCIB President and CEO Peter Robinson and former Congressman James Bacchus argues that the United States needs to capitalize on changes in global economics and energy markets to go on the offensive and negotiate new, market-opening trade agreements.

On trade, time for US to play offense

Investment, Yes! But Let’s Be Consistent

Published on February 19, 2015

By Shaun Donnelly

Foreign investment in the U.S. can create jobs, increase exports, strengthen U.S. competitiveness, give American consumers increased choices, and bolster tax revenues at the local, state, and federal level. But let’s not ignore the other side of the FDI coin, outward FDI by U.S.-based companies, writes Shaun Donnelly in Investment Policy Central.

Read the full post: http://www.investmentpolicycentral.com/content/investment-yes-let%E2%80%99s-be-consistent

Investment Protection In TTIP: One Step Forward, Two Steps Back

Published on February 19, 2015

By Eva Hampl

The EU Commission finally released its report on the online public consultation on investment protection and investor-state dispute settlement in the Transatlantic Trade and Investment Partnership, but it is disappointing that negotiations on an investment chapter in TTIP have yet to resume, writes Eva Hampl in Investment Policy Central.

Read the full post: http://www.investmentpolicycentral.com/content/investment-protection-ttip-one-step-forward-two-steps-back

Make 2015 the Year of Trade

Published on January 25, 2015

By Jerry Cook, HanesBrands, Chair of USCIB’s Customs & Trade Facilitation Committee

“A new year means new opportunities, especially in the trade world. With the recently resurrected World Trade Organization Trade Facilitation Agreement seemingly back on track, and Trans-Pacific Partnership close to completion, 2015 should be the year of trade.”

Read the full column at American Shipper.