Growth, Jobs and Open Markets Archives

USCIB Champions World Trade Week in New York

Published on May 21, 2010
Awards breakfast keynote speaker Joseph Quinlan (left) is introduced by USCIB President Peter Robinson.
Awards breakfast keynote speaker Joseph Quinlan (left) is introduced by USCIB President Peter Robinson.

World Trade Week, a nationwide celebration of international trade, was observed during, before and after the week of May 17 in many cities across the country.  Building upon our leadership on trade issues in the New York City area, USCIB proudly served as a main organizer of World Trade Week NYC, under whose auspices numerous trade-themed events took place around the city and the region.

This year’s festivities took on extra importance in light of President Obama’s goal, announced during the State of the Union address, of doubling U.S. exports within five years.  USCIB and other business groups applauded this goal, which got a boost from newly released export figures.

At a kickoff awards breakfast held at Baruch College in Manhattan, several New York-area companies and organizations were honored for international achievements and growth.  Joseph P. Quinlan, economist and chief global market strategist with Bank of America, provided keynote remarks emphasizing America’s continuing role as the world’s top exporter and manufacturer, and the importance of pursuing sensible policies to maintain that advantage by expanding opportunities for trade and investment overseas.

Calling himself a “paranoid optimist” on trade, Mr. Quinlan applauded the president’s goal of doubling exports but wondered if America’s political leaders had the will to see it through in terms of concrete policies and new trade agreements.  On this score, he urged the swift ratification of pending U.S. free trade agreements with Korea, Colombia and Panama.  Mr. Quinlan also said the United States lagged Europe and Asia in viewing expanded trade and overseas investment as essential public policy objectives.

USCIB’s Amanda Barlow (second from left) and guests at the awards breakfast. (Photo: Marcela Solano)

U.S. exports of goods and services increased by 16 percent during the first quarter of 2010, the Commerce Department announced the day after the awards breakfast.  “This is a great progress report,” said Fred P. Hochberg, head of the Export-Import Bank of the United States.  “What it really says is that there are significant opportunities globally for both large and small U.S. businesses.”

Meanwhile, a new survey by American Express signaled good news for business travel in the months ahead.  The majority of nearly 500 senior finance executives surveyed worldwide said they intend to maintain or increase business travel spending in 2010.

That dovetailed with a recent pickup in USCIB’s ATA Carnet service, which permits temporary export of many goods for trade shows, products demonstrations and other uses.  Carnet usage, which often serves as a leading indicator of exports, took a big hit alongside trade as a whole following the onset of the 2008-2009 recession, but has rebounded lately.

USCIB also organized a seminar on “Managing Your Trade Risk in Today’s Global Economy,” which examined the critical importance of risk mitigation for exporters and importers as we emerge from recession.  Speakers included: Dennis Gates of Roanoke Trade Services, who reviewed the global outlook on trade as well as insurance products to protect international transactions; Andrea Ratay of HSBC, who discussed the bank’s trade confidence index, which has also shown positive signs; and USCIB’s Amanda Barlow, who discussed how ATA Carnets can help exporters avoid costly duties, taxes and currency fluctuations.

As World Trade Week got under way, USCIB issued a call to action , urging members and friends to contact their elected representatives to voice their support for expanded trade and international commerce as essential drivers of U.S. jobs, growth and competitiveness.  In addition, in a podcast on the website of the Council on Foreign Relations, another World Trade Week partner, Jonathan Huneke, USCIB’s vice president for communications and public affairs, addressed the importance of sensible policies to secure the benefits of international trade and investment.

Staff contact: Cynthia Duncan

Interview with USCIB’s Jonathan Huneke (Council on Foreign Relations website)

World Trade Week NYC website

More on USCIB’s ATA Carnet Export Service

More on USCIB’s Trade and Investment Committee

Business Presses for Reform of Agricultural Exports and Travel With Cuba

Published on April 30, 2010
Havana waterfront: Cubans are hungry for American agricultural products, but our government makes it difficult for farmers to export to the island.
Havana waterfront: Cubans are hungry for American agricultural products, but our government makes it difficult for farmers to export to the island.

USCIB has joined other U.S. business associations and the agricultural and agribusiness community in backing legislation in the House of Representatives to ease certain restrictions on agricultural trade with Cuba and travel to that country.

On April 12, 2010, we expressed our strong support for H.R. 874, which would remove restrictions on the travel of U.S. citizens to Cuba.  The letter notes that current policies toward Cuba, including the travel ban, have not achieved their objectives and that the U.S. continues to lose influence in that country by isolating our citizens from traveling their as “Ambassadors of Freedom.”  We also highlight the anomaly that U.S. citizens can travel to North Korea and Iran, but not to Cuba.

On April 28, 2010, USCIB joined a larger group of organizations, most of which represent the U.S. agricultural community, in calling for passage of H.R. 4645, the Travel Restriction Reform and Export Enhancement Act.

The bill has three provisions:

  • It would reverse a Treasury Department interpretation of the term “payment of cash in advance” for agricultural sales to Cuba, which has a strong negative impact on U.S. exports.
  • It would eliminate a costly and discriminatory requirement that payments to U.S. agricultural exporters must pass through banks in third countries.
  • And it would lift restrictions on U.S. citizens traveling to Cuba.

USCIB has long believed that U.S. policy toward Cuba is antiquated, ineffectual and self-defeating, and sees these bills as a modest step forward in easing existing restrictions on agricultural trade and travel.

Staff contact: Timothy Deal

April 12 business letter on H.R. 874 to allow travel between the United States and Cuba

April 28 letter on H.R. 4645, Travel Restriction Reform and Export Enhancement Act

More on USCIB’s Trade and Investment Committee

 

New Report Shows Mixed Outlook for Recovery of Global Trade Finance

Published on April 22, 2010

3977_image001Paris and New York, April 22, 2010 – Prospects for a strong and lasting trade recovery are mixed, with access to affordable trade finance constrained, trade protectionism still a problem, and banks facing tougher capital requirements for their trade assets, a major new survey on trade finance by the International Chamber of Commerce (ICC) said today.

“The 2010 survey has confirmed that the current global financial crisis has continued to affect financial institutions and markets worldwide,” the report concludes, citing a 12 percent drop in trade in terms of volume last year, the sharpest decline since World War II.

“This is a challenging economic environment, and trade volumes may be further impacted in the coming months. On a global basis, the predictions for 2010-2011 remain cautious; many expect that the economic turmoil will continue to predominate.”

Nevertheless, 84 percent of respondents said they anticipated an increase in demand this year for traditional trade products such as commercial and standby letters of credit and guarantees.

ICC is the largest, most representative business organization in the world.  Its thousands of member companies in over 120 countries have interests spanning every sector of private enterprise.  The United States Council for International Business (USCIB), based in New York, serves as ICC’s American national committee.

The survey report, titled Rethinking Trade Finance 2010, includes the results of specific responses received from 161 banks in 75 countries, a 32 percent increase in the number of respondents compared with the last global survey in March 2009. The surveys, including an interim one published in September, were commissioned by the World Trade Organization’s Expert Group on Trade Finance to track the developments in the industry.

In terms of value, 60 percent of respondents indicated that trade finance activity had decreased between 2008 and last year, while 43 percent of financial institutions reported a decrease in export letters of credit volume, slightly down from 47 percent in the 2009 survey. On imports, 26 percent of respondents said they saw a decrease in import letters of credit, with 51 percent seeing no change from 2008.

ICC said the drop in trade was less marked in some regions, particularly Asia. It said most Chinese partners benefited from that country’s fiscal stimulus package and the rebound in Chinese imports. Worldwide, exports of durable goods were most affected, while trade in non-durable consumer goods including clothing and food declined the least. Trade in services was generally more resilient than merchandise trade.

“The survey is a continuation of ICC’s long series of actions in support of international trade,” ICC Chairman Victor K. Fung wrote in a foreword to the report. “In recent years ICC has emphasized the imperative of concluding the Doha Round of trade talks and on continuing the fight against protectionism.”

The report takes note of the pledges to fight protectionist pressures by G20 countries following the Washington, London, and Pittsburgh summits. “Yet since the onset of the crisis, many countries have veered towards policies that favor domestic products over foreign imports,” the report notes. “Protectionist measures should be resisted, as they curtail trade flows and add to the adverse effects of the global recession on individual country exports, economic activity and unemployment.”

But while demand for trade finance remains strong for traditional trade finance instruments, the costs remain substantially higher than before the global recession. Some 30 percent of respondents said there had been an increase in fees for commercial letters of credit, standbys and guarantees in 2009. The increase was attributed to higher funding costs, increased capital constraints, and greater counterparty risk.

Also worrying is the intense scrutiny of documents by banks, with 34 percent of respondents saying they had seen an increase in the number of refusals for trade finance, up from 30 percent in 2009. The number of doubtful or spurious discrepancies remains high, with 44 percent of respondents indicating that they had experienced such cases compared with 48 percent the previous year, at the height of the financial crisis.

“This trend toward claiming discrepancies that effectively have little or no foundation is worrisome and may prove damaging to the integrity of the documentary credit as a viable means for settlement in international trade,” the report warns.

The report raises concerns that, despite the injection of US$250 billion in aid for trade finance made available following the G20 summit in London in April 2009, evidence is accumulating that the implementation of the capital adequacy regime under Basel II rules is contributing to the drought in trade finance. ICC has expressed concern that the proposal by the Basel Committee on Banking Supervision to increase the risk weighing of trade finance under a new framework to limit bank leverage would adversely impact the supply of cost-effective trade credit to businesses.

“It appears that low-risk trade finance instruments are being lumped together with higher-risk, off-balance-sheet items, without an appreciation of unintended consequences,” the report adds.

The  ICC trade finance report is being launched simultaneously in Paris led by ICC Secretary General Jean Rozwadowski and in Beijing by ICC Chairman Fung and ICC China Secretary General Zhou Xuehai.

USCIB promotes international engagement and prudent regulation in support of open markets, competitiveness and innovation, sustainable development and corporate responsibility.  Its members include top U.S.-based global companies and professional services firms from every sector of the economy, and with operations in every region of the world.  With a unique global network encompassing leading international business organizations, including ICC, 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, USCIB
+1 212.703.5043 or jhuneke@uscib.org

ICC report: Rethinking Trade Finance 2010

ICC website

More on USCIB’s Trade and Investment Committee

 

Open Trade Is Essential for Successful Action on Climate

Published on December 16, 2009
Trade can help make a greener world.
Trade can help make a greener world.

Copenhagen and New York, December 16, 2009 – What do the UN climate talks and the stalled Doha Round of trade negotiations have in common, apart from seemingly mind-numbing complexity?  Answer: Success in both will be essential for global sustainable development.  So says the head of an industry group representing top U.S. multinationals.

“International trade is a proven path to economic growth and technological advancement,” according to Peter M. Robinson, president and CEO of the United States Council for International Business (USCIB).  “As countries trade more, they grow richer and have additional resources to devote to environmental protection.  Both industrialized and developing countries have a clear stake in coordinated action to open markets and tackle global warming.”

So do companies, which is one reason USCIB members and other business representatives gathered yesterday with UN negotiators for a key side event in Copenhagen. The invitation-only event, titled “Trade, Investment and Climate Change – Synergies for Economic Growth and Environmental Progress,” sought to underscore the American business community’s strong commitment to positive and mutually reinforcing outcomes in global climate and trade negotiations.

“We want to highlight the positive relationship of open trade and investment with technology and financing for climate solutions,” said Mr. Robinson.  “Reaching a comprehensive WTO agreement that lowers trade barriers would boost investment and innovation in climate-friendly technologies.  On the other hand, if trade and climate are set against each another, the result would be to fuel protectionism and complicate the already difficult task of forging a global consensus on climate.”

Even now, said Mr. Robinson, too many countries are leaning toward using trade as a “hammer” to force countries to follow a specific path on reducing emissions of greenhouse gases.  “This temptation must be resisted,” he stated.”  “We need more carrots, and fewer sticks.”

Freeing up trade in environmental goods and services would give a boost to curbing global warming.  A 2007 World Bank study found that removing tariffs and non-tariff barriers in 18 of the high-emitting developing countries for four basic clean energy technologies (wind, solar, clean coal and efficient lighting) could lower the costs of these technologies by 13 percent, which could help reduce emissions significantly.

“What’s more, it is clear that these reductions could be further augmented through better management practices and technical know-how, both of which tend to follow in trade’s wake,” according to Mr. Robinson, who is attending the climate conference under the banner of USCIB’s global affiliate, the International Chamber of Commerce (ICC), which is coordinating business and industry representation in Copenhagen.

USCIB promotes international engagement and prudent regulation in support of open markets, competitiveness and innovation, sustainable development and corporate responsibility.  Its members include top U.S.-based global companies and professional services firms from every sector of the economy, and with operations in every region of the world.  With a unique global network encompassing leading international business organizations, including ICC, 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

ICC website (includes related news from Copenhagen summit)

More on USCIB’s Environment Committee

More on USCIB’s Trade and Investment Committee

Business Groups Voice Concern Over Restrictive Chinese Innovation Rules

Published on December 10, 2009

USCIB joined a number of other leading global business associations in submitting a letter to the Chinese government in response to new rules requiring vendors to gain accreditation for their products before they can be included in a government catalog of products containing “indigenous innovation.”

These requirements could effectively close off China from innovation and technology developed overseas and does not uphold the G20’s leaders’ commitment to refrain from introducing new protectionist measures.

In other USCIB China committee news, please save the date of January 26 for the next meeting, in Paris, of the BIAC China Task Force, which will include an afternoon consultation with the OECD Informal Reflection Group on China.  Please contact Justine Bareford (jbareford@uscib.org) if you would like more information or are interested in attending these meetings.

Staff contact: Justine Bareford

Joint industry letter on Chinese innovation rules (click here for Chinese version)

More on USCIB’s China Committee

Asia-Pacific Business Seeks Greater Transparency to Move Goods

Published on November 13, 2009
L-R: Laurie Goldman of Levi Strauss & Co; Arrow Augerot of USTR and Raymond Yee of DHL
L-R: Laurie Goldman of Levi Strauss & Co; Arrow Augerot of USTR and Raymond Yee of DHL

Initiative to make trade information more widely available in the region discussed during APEC leaders’ meeting in Singapore

New York and Singapore, November 13, 2009 – Leading companies are urging governments throughout Asia and the Pacific to make their tariffs and related rules more transparent, saying this could provide a big boost to the region as trade rebounds from the past year’s severe drop-off.

To help draw attention to the complexity of trade in the region, the United States Council for International Business (USCIB) and other members of the U.S. APEC Business Coalition, organized a November 12 business discussion on the APEC Transparency Initiative on Tariffs and Preferential Rules of Origin during the APEC CEO Summit and Leaders Meeting in Singapore.

Failure to take advantage of the current “spaghetti bowl” of regional trade agreements can be costly, attendees agreed. Raymond Yee, vice president for Asia-Pacific customs and regulatory affairs with DHL Express, provided his perspective on sourcing within the region and the possible impact of this initiative on business. Planning related to trade agreements is a crucial yet complex process.  Company representatives recognize the need for the transparency initiative and believe it would facilitate trade by businesses of all sizes across the APEC region.

Proposed by the U.S. and Japan and endorsed by APEC trade ministers in July 2009, the APEC Transparency Initiative aims to help companies take advantage of the significant trade liberalization in the region.  Arrow Augerot, deputy assistant U.S. trade representative for APEC affairs, was on hand to discuss the initiative at the November 12 event.

“This initiative is very timely because the lack of publicly available information on tariffs and preferential rules of origin has made it difficult for companies to take full advantage of the many free trade agreements negotiated in the APEC region,” said Laurie Goldman, senior manager of worldwide government affairs and public policy with Levi Strauss & Co.  “What we are proposing is a central database that would be searchable and up-to-date.  We would like to review the initiative with the broader APEC business community, exploring how to integrate information from all APEC economies.”

APEC trade ministers have pledged to provide the public with up-to-date and accurate tariff and rules of origin information by the time of their next meeting in June 2010, and to develop an APEC-specific website on tariffs and rules of origin by next year’s APEC leaders meeting in November.

The National Center for APEC (NCAPEC) and the U.S.-ASEAN Business Council are co-chairs of the U.S. APEC Business Coalition, which encompasses many leading U.S. industry groups.

NCAPEC is the only U.S. business association focused exclusively on facilitating American private sector input to the APEC process. The National Center functions as a conduit for U.S. businesses into APEC by serving as the Secretariat for the three U.S. executives who are appointed members of the APEC Business Advisory Council.

The US-ASEAN Business Council is the premier advocacy organization for U.S. Businesses operating in Southeast Asia. The Council serves a select membership of companies, including 7 of the Fortune 10 and 20 of the Dow Jones 30 companies, from its headquarters in D.C. and its five regional offices.

USCIB promotes open markets, competitiveness and innovation, sustainable development and corporate responsibility, supported by international engagement and prudent regulation.  Its members include top U.S.-based global companies and professional services firms from every sector of our economy, with operations in every region of the world.  With a unique global network encompassing leading international business organizations, 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

More on the APEC Transparency Initiative and USCIB Involvement:
https://uscib.org/apectitrprofile-ud-3933

APEC CEO Summit Website:
http://www.apec2009.sg/index.php?option=com_content&view=article&id=100&catid=38

Co-Chairs of the U.S. APEC Business Coalition:
NCAPEC: http://www.ncapec.org
US-ASEAN Business Council: http://www.us-asean.org

CEO Roundtable on APEC

Published on October 27, 2009

As part of the APEC Business Coalition, USCIB has the pleasure to extend an invitation for nominations of a member company CEO for the forthcoming State Department CEO Roundtable on APEC, which is scheduled for January 14, 2010.

The roundtable, to be hosted by Secretary of State Hillary Clinton, presents an excellent opportunity to interface with 30 top U.S. company CEOs doing business in the APEC area, as well as top-level U.S. government officials.  The secretaries of the treasury, commerce, transportation, energy, and the U.S. trade representative have attended this roundtable in the past.

Please contact Justine Bareford (jbareford@uscib.org) if you would like to put forward your company’s CEO for consideration for this high-level APEC event.  Nominations must be received no later than November 20.

In other APEC news, this year’s APEC CEO Summit will be held November 12-14 in Singapore.  This event will be attended by the world’s top business leaders as well as leaders from many APEC countries.  President Barack Obama is expected to address delegates at the summit as part of his inaugural visit to Asia.  The two-day summit will focus on addressing the economic crisis and key global issues.

USCIB will be represented at the APEC CEO Summit by our consulting director for APEC affairs, Kimberly McLaughlin.

Staff contact: Justine Bareford

 

Investment Treaty Talks With China Move Forward

Published on September 24, 2009
L-R: Christopher Wall (Pillsbury Winthrop), Wesley Scholz (State Dept.) and Daniel Bahar (USTR).
L-R: Christopher Wall (Pillsbury Winthrop), Wesley Scholz (State Dept.) and Daniel Bahar (USTR).

On September 15, USCIB joined with the Emergency Committee for American Trade, the U.S.-China Business Council and the U.S. Chamber of Commerce to co-host a briefing by U.S. negotiators on the status of the bilateral investment treaty (BIT) negotiations with China.  The United States currently has BITs with some 40 other countries, and their provisions are included in many U.S. free trade agreements.  The treaties help protect private investment, develop market-oriented policies in partner countries and promote U.S. exports.

Wesley Scholz, director of the State Department’s Office of Investment Affairs, and Daniel Bahar with the office of the U.S. Trade Representative said that, while negotiations with China were initiated under the Bush Administration, at last July’s bilateral Strategic and Economic Dialogue meetings in Washington, the two governments reaffirmed that the BIT negotiations were ongoing and could contribute to the implementation of G-20 commitments to an open global economy.

Comments on China’s WTO Commitments

USCIB recently provided comments to the U.S. Trade Representative’s office in response to an annual request for information on China’s compliance with its World Trade Organization commitments. We received valuable comments and updates to the document this year from engaged USCIB members highlighting industry concerns in a number of different industries on China’s progress toward the market liberalization benchmarks it agreed to in joining the WTO in 2001. USCIB’s submission can be found on the China Committee webpage.

Several rounds of negotiations have been held, focusing on a detailed explanation by each side of their model text (see related story).  The next step will be to attempt to produce a consolidated and bracketed text from which the hard negotiations will ensue. Importantly, Mr. Scholz and Mr. Bahar stated that the tone of the discussions is positive and constructive.  The next round of negotiations is expected to take place in November.

USCIB member Christopher Wall (Pillsbury Winthrop Shaw Pittman) hosted the meeting, and USCIB Trade and Investment Committee Chair Scott Milller, (Procter & Gamble) guided the discussion.

More on USCIB’s Trade and Investment Committee

More on USCIB’s China Committee

Bilateral Investment Treaties: Reviewing the U.S. Model

Published on August 28, 2009

yellow_network_usaUSCIB is participating in a review of the model U.S. bilateral investment treaty (BIT). The United States currently has BITs with some 40 other countries, and their provisions are included in many U.S. free trade agreements. The treaties help protect private investment, develop market-oriented policies in partner countries and promote U.S. exports.

Scott Miller (Procter & Gamble), who chairs USCIB’s Trade and Investment Committee, Ted Posner (Crowell & Moring) and USCIB Vice President Stephen Canner are participating in a review of the model treaty.  The review is taking place under the auspices of a sub-group of the State Department’s Advisory Committee on International Economic Policy, chaired by Alan Larson (Covington & Burling) and Thea Lee (AFL-CIO).  Others participating in the review are drawn from business, labor and the NGO community.

From a USCIB perspective, our objectives are to correct the shortcomings of the model BIT revised in 2004 and to establish a new model that sets the highest standards of market access, investor protection and dispute resolution.  The sub-group’s report will be Advisory Committee in late September.  USCIB’s Mr. Canner made a statement at a public hearing on the matter that is available on USCIB’s website at www.uscib.org/docs/2009_07_29_model_bit.pdf.

More on USCIB’s Trade and Investment Committee

Briefing: Are Countries Living Up to Their Open-Market Promises?

Published on June 18, 2009
BIAC Chairman Charles Heeter of Deloitte (right) introduces OECD Secretary General Angel Gurría.
BIAC Chairman Charles Heeter of Deloitte (right) introduces OECD Secretary General Angel Gurría.

On June 2, coincident with USCIB’s latest OECD tax conference, we had the pleasure of hosting a timely and well attended luncheon in Washington, D.C., examining the OECD’s role in helping keep markets open to cross-border investment.

Taking place against the backdrop of ongoing economic turmoil, growing protectionist sentiment and ambitious proposals for regulatory reform, these two events provided important opportunities for USCIB members to interact directly with senior government and international officials making the decisions that will shape the future of the global economy.  They also underlined the importance of USCIB’s affiliation with the Business and Industry Advisory Committee (BIAC) to the OECD in providing access to the work of the OECD.

The open markets lunch, organized with support from the TransAtlantic Business Dialogue, BIAC, Deloitte and several other leading business organizations, was titled “The Global Investment Agenda: Challenges to Global Capital Flows and Foreign Investment.”  The impetus for the session was growing concern that cross-border capital flows have contracted sharply and that governments, while cognizant of the benefits of open investment regimes, are apt to yield to domestic economic and  political pressures and impede cross-border investment.

OECD Secretary General Angel Gurría set the tone in his opening address, declaring: “It is crucial for the investment policy community to counter such pressures, now and firmly.”  He noted that the OECD is ideally placed to work on investment openness, and that along with the IMF, WTO and UNCTAD, it is monitoring investment activity to ensure that governments refrain from raising new investment barriers.  A report by this group will be sent to the G20.

A panel chaired by Dan Price (Sidley Austin), a top White House aide in the previous administration and including Jeff Shafer (Citigroup), Jose Vinals (International Monetary Fund) and Matthias Sonn (German Embassy), picked up the general theme struck by Mr. Gurría.  They urged business to raise its voice to the Obama Administration on the need for strong leadership to resist investment protectionism and to keep markets open for cross-border investment.

Staff contact: Rob Mulligan

More on USCIB’s Trade and Investment Committee