Policy Areas Archives

G8 Business Leaders: Crisis Demands Urgent Response But Does Not Indicate a Failure of Market Economics

Published on December 4, 2008
Leaders of the G8 business federations (USCIB President Peter Robinson is at far right).
Leaders of the G8 business federations (USCIB President Peter Robinson is at far right).

Paris and New York, December 4, 2008 – Meeting in Paris, business federation heads from the G8 nations called for urgent measures by governments to correct “real dysfunctions” in the world financial system.  But they said the crisis did not call into question the basic assumptions of private sector-led growth, and they pressed for an immediate re-launch of WTO trade talks as a way to revive the global economy.

“We came to Paris to voice our common support for efforts to make the market economy work better, increase financial transparency and foster closer international cooperation,” said USCIB President and CEO Peter M. Robinson, who joined business leaders from North America, Europe and Japan in issuing a joint statement prior to a meeting with French President Nicolas Sarkozy.  “Where more clarification and regulation is needed, it must be smart regulation, and policy makers must avoid over-regulation at this delicate time for the global economy.”

In their statement, the business leaders stated that “the present crisis does not call into question the basic principles of the open market economy but calls for urgent responses mainly in technical and regulatory terms.”  They said the causes of the crisis were multiple, and included monetary policies leading to excessive liquidity, lack of regulation or inappropriate regulation, attempts to achieve high yields without an accurate assessment of risks and inadequate coordination of macro-economic policies.

“These are real dysfunctions which have had serious consequences and which in concrete terms call for a revision of the rules governing agents, products and operations on the financial open markets,” the statement said.  “On the other hand, these dysfunctions do not in any way cast doubt on the open market economy, which requires clear and shared rules to make private companies and entrepreneurs free to create, grow and innovate.  Businesses have today the talented people, technologies, and drive to succeed as before the crisis.  This is the cause for our optimism.”

The business chiefs welcomed pledges made by leaders at last month’s G20 Summit in Washington to avoid protectionist policies.  They echoed the G20’s call for efforts to restart the struggling Doha Round of trade talks as an immediate priority.  “The business community fully supports all of the efforts that will result in a prompt, ambitious and balanced conclusion to the Doha Development Agenda,” the statement said.  “This is necessary to ensure the world’s economic growth in the coming years.”

USCIB’s Mr. Robinson applauded the French business federation MEDEF for convening the business leaders, and for working rapidly and effectively to develop a consensus approach all parties could support without reservation.

The other participants in the G8 Business Summit were:

Fujio Mitarai, president of Nippon Keidanren (Japan)

Perrin Beatty, president of the Canadian Chamber of Commerce

Laurence Parisot, president of MEDEF (France)

Jürgen R. Thumann, president of BDI (Germany)

Emma Marcegaglia, president of Confindustria (Italy)

Alexander Shokhin, president of RSPP (Russia)

Martin Broughton, president of the Confederation of British Industry

Thomas J. Donohue, president of the U.S. Chamber of Commerce

Ernest-Antoine Seillière, president of BusinessEurope.

USCIB promotes an open system of global commerce in which business can flourish and contribute to economic growth, human welfare and protection of the environment.  Its membership includes more than 300 leading U.S. companies, professional services firms and associations whose combined annual revenues exceed $4 trillion.  As American affiliate of three global business groups – the International Chamber of Commerce, the International Organization of Employers, and the Business and Industry Advisory Committee to the OECD – USCIB provides business views to policy makers and regulatory authorities worldwide, and works to facilitate international trade.

Contact: Jonathan Huneke, VP Communications & Public Affairs, USCIB (212) 703-5043 or jhuneke@uscib.org

Statement From the G8 Business Summit Leaders (click here for summary)

Watch the press conference (MEDEF website, French/Japanese/English)

USCIB statement on the G20 Summit (November 2008)

More on USCIB’s Trade and Investment Committee

China Daily (Hong Kong edition): A revitalized global trading system needed to avert protectionism

Published on November 10, 2008

By Victor K. Fung

As a key component of the global economy, international trade is a major source of economic revenue and a major source of employment for any country. The present financial crisis and a looming recession will undoubtedly have a negative impact on trade and severely curtail growth because of liquidity and deteriorating consumer sentiment.

To avert disaster, leaders of the industrialised world have reacted swiftly to restore trust and confidence in the banking system. Such a brave move is now required to ensure that the global trading system does not collapse under the burden of an unstable world. But it is vital that, at this crucial moment, we should reflect upon where we have come from, before taking potentially disastrous measures that may precipitate protectionist action.

The last 20 years have witnessed an unprecedented expansion of the global market and unprecedented global economic growth and welfare. During the last two halcyon decades, it perhaps hasn’t been surprising that people were not especially interested in the apparent complex intricacies of trade negotiations.

The stark paradox of the last decade is that while the global market boomed, the global trade policy process stalled. More and more countries joined the WTO — growing from about 90 in 1990 to 153 now — but they then proved incapable of moving the agenda forward.

The paralysis may, in part, be a consequence of the system’s success. The multiple reforms of the latter part of the 20th century in developing countries have resulted in many more actors, big and small, engaged in global trade. The trade regime is no longer the sole province of the OECD countries as it was throughout most of its existence until recently.

Not only the fast-growing economies of China and India, but many other countries, such as Pakistan, Bangladesh, Vietnam, Indonesia, Chile, Argentina, Mexico, Turkey, Morocco, Kenya, and Egypt, increasingly want to have a say in the trade-policy process, because their stakes in the trade regime have increased significantly.

Vietnam has probably experienced, in proportionate terms, a greater poverty reduction, within the shortest period of time, than any country in history; the growth that drove that poverty reduction in considerable part emanated from the trade regime that Vietnam joined in the mid-1990s.

One consequence of this feverish   activity has been to question why one should bother with what appears remote and arcane trade negotiations, when in the real world, things were going so well.

Another rather different consequence has been that the increase and diversity of actors has made the process far more complex. The repeated failures of the Doha Agenda since its launch in 2001 can be ascribed to two forces: a lack of sustained public interest and support, including from the business community; and incapacity on the part of negotiators to bridge the cultural and economic divides.

In appealing for the application of global solutions to the present financial turmoil, British Prime Minister Gordon Brown stated: “Successful market economies need trust, which can only be built through shared values”. Given the immense benefits that trade has generally conferred upon the people of many nations, it follows that one of the potentially strongest foundations on which to build shared values is in a solid and fair rules-based multilateral trade system that reflects the new realities of this potentially exciting and dynamic new global age. In this context, it is encouraging to note that China has committed to strengthen multilateral trade and economic cooperation, as stated in the country’s 11th Five-Year Program and in the 17th National Party Congress.

The financial crisis has prompted urgent and unprecedented globally co-ordinated actions. Without doubt, the world economy requires emergency surgery. At the latest Asia-Europe Meeting Summit convened in Beijing, Chinese Premier Wen Jiabao called for enhanced efforts to prevent the financial crisis from evolving into trade protectionism. The host country also proposed to establish a mechanism for multilateral trade cooperation and facilitation.

What is being recognized is that at the very heart of a global and sustainable economic revival, the multilateral trading system must be strengthened. We still live in perilous times; we live in a global environment in which, as Cordell Hull, Franklin Roosevelt’s secretary of state and a subsequent Nobel Peace Prize winner, wrote “The welfare of nations is indissolubly connected with friendliness, fairness, equality and the maximum practicable degree of freedom in international trade.”

To escape from the abyss of protectionism, the world needs a revitalized global rules-based multilateral trading system that will provide a robust global framework and restore a sense of global trust.

The author is Chairman of the International Chamber of Commerce.

More on USCIB’s Trade and Investment Committee

ICC website

Key Officials Address Critical Role of Sovereign Wealth Fund Investment

Published on October 14, 2008
Deputy Treasury Secretary Robert Kimmitt: Without access to capital, growth will seize up.
Deputy Treasury Secretary Robert Kimmitt: Without access to capital, growth will seize up.

Washington, D.C., October 14, 2008 – On the heels of a landmark agreement by leading sovereign wealth funds (SWFs) to increase their transparency, representatives of major governments and SWFs gathered yesterday in Washington, D.C. to discuss ways to keep major markets open for investment from these increasingly important sources of capital.

At a forum organized by the United States Council for International Business (USCIB), senior officials from the U.S. Treasury and the 30-nation Organization for Economic Cooperation and Development (OECD) were joined by representatives of China’s leading SWF, Goldman Sachs and other leading experts.  Speakers emphasized the critical importance of maintaining market openness to all forms of investment, including from SWFs, as the world contends with the ongoing financial crisis.

“In these times of heightened uncertainty, it is imperative that we don’t turn inward, but rather embrace free investment and trade,” stated U.S. Deputy Treasury Secretary Robert Kimmitt.  “Allowing capital to flow freely is vital for economic growth and will enable healthy institutions to emerge from the current turmoil.  Without access to capital, the engines of economic growth seize up and risk the health of the broader economy.”

Amid a severe credit crunch, more and more companies and governments are turning to SWFs for much-needed capital.  SWFs have been in existence for decades, but their role and the number of funds has grown significantly in recent years, along with concerns about the management and intention of some funds.

Jesse Wang of China Investment Corp. (center), with USCIB’s Stephen Canner and Peter Robinson.
Jesse Wang of China Investment Corp. (center), with USCIB’s Stephen Canner and Peter Robinson.

The forum examined the International Working Group on Sovereign Wealth Funds’ recently released Generally Accepted Principles and Practices for sovereign wealth funds, as well as implementation of the OECD’s recommendations for keeping markets open to SWF investment.

Reflecting on efforts to address the financial crisis at the IMF/World Bank meetings over the weekend, OECD Secretary General Angel Gurría commented that IMF members were now “less of a cacophony, more of a choir.”  He said it was essential for countries seeking to benefit from investment by sovereign wealth funds to abide by fundamental OECD principles of openness and non-discrimination.

“We want to avoid the illegitimate use of national security to stop bona fide investments,” he said.  Mr. Gurría told the audience efforts by the IMF and OECD to develop rules and standards for SWFs and host governments had fostered confidence and removed suspicion about sovereign investment.

Other speakers at the USCIB forum included Daniel Sullivan, assistant secretary of state for economic and business affairs, Jesse Wang, executive vice president of the China Investment Corp., John Waldron, managing director at Goldman Sachs, and Edwin Truman of the Peterson Institute for International Economics.  Jerry Leamon, global managing partner with Deloitte, and Scott Miller, director of national government relations with Procter & Gamble and chair of USCIB’s Trade and Investment Committee, also participated.

The forum was co-sponsored by the Business and Industry Advisory Committee to the OECD, TransAtlantic Business Dialogue, National Foreign Trade Council, Emergency Committee for American Trade, National Association of Manufacturers, Financial Services Forum and Financial Services Roundtable.

USCIB promotes an open system of global commerce in which business can flourish and contribute to economic growth, human welfare and protection of the environment.  Its membership includes more than 300 U.S. companies, professional service firms and associations, whose combined annual revenues exceed $3.5 trillion.  As American affiliate of the leading international business and employers organizations, USCIB provides business views to policy makers and regulatory authorities worldwide and works to facilitate international trade.

Contact:

Jonathan Huneke, VP communications, USCIB

(212) 703-5043 or jhuneke@uscib.org

Remarks by Deputy Secretary Kimmitt

Generally Accepted Principles and Practices for Sovereign Wealth Funds

More on USCIB’s Trade and Investment Committee

From the President: An Energy Agenda for the Next Administration

Published on August 1, 2008

The path to cleaner, affordable energy is through international cooperation

By Peter M. Robinson

Peter M. Robinson
Peter M. Robinson

The next administration will face a number of important international challenges requiring prudent and effective action.  Near the top on anyone’s list is energy and climate change.

Energy is the lifeblood of the global economy.  American business is a vital player in the production and transport of energy all over the world, and of course our society consumes more energy than any other nation.  We have made tremendous strides in developing cleaner technologies and energy sources, while improved efficiency has boosted our competitiveness as well as environmental protection.  Nevertheless, as a trip to the gas station will attest, energy costs are a challenge for everyone, including global companies.  Indeed, some say we may need to adapt to an era of permanently higher energy prices.

However, energy can never be seen as just a “business” issue.  Indeed, it is a fundamental prerequisite for social and economic development across a broad range of areas.  Pick almost any of the Millennium Development Goals – progress toward which is a key goal of this year’s UN General Assembly session – and you will find an energy-related component.  Clean water, health care, poverty eradication: how can any of these be effectively addressed without greater access to energy?

Of course, much of the debate over energy has focused on climate change.  What is the best path to a lower-carbon future?  And how can we best use our energy resources to mitigate and adapt to the effects of global climate change, while still ensuring we meet the needs of a growing world?  Global solutions are called for, and our next president will need to take the lead in crafting international rules to tackle both the energy and climate challenges.

For USCIB members and other global firms, the way forward is clear: the only way to provide dependable, affordable and cleaner energy is through international action and cooperation to deploy and upgrade energy systems worldwide.

We have worked hard to advance understanding of these issues at the highest levels, in global talks under the UN Framework Convention on Climate Change, where countries are seeking to forge agreement on broader and more inclusive post-2012 actions as the Kyoto Protocol reaches the end of its first round commitments, and in the G8 as well (see page 9).  We have leveraged our unique affiliations with the International Chamber of Commerce and the Business and Industry Advisory Committee to the OECD to advance a coordinated and integrated approach to climate and energy around the world.

There can be no doubt that American companies are up to the challenge.  The next administration must therefore frame a vision of U.S. leadership on energy and climate that places a high priority on our proven technological know-how and the business community’s ability to commercialize and disseminate the fruits of innovation.  This vision should be optimistic, driven by an understanding of the power of markets and international trade to deliver results.

A new vision on energy and climate should encompass four essential goals:

  • Broaden the energy mix. Diversifying energy portfolios is a proven strategy to manage tradeoffs and uncertainty in the near and long term.  We should not foreclose any energy options in international discussions.
  • Foster innovation. The transfer of new and cleaner energy technology to emerging markets such as China and India will be critical.  But to make this happen, private-sector innovation needs to be fostered, and intellectual property rights protected.
  • Embrace markets. The International Energy Agency puts the bill for meeting global energy needs over the next two decades at $20 trillion.  The lion’s share must come from the private sector.  To do this, we need open markets, protection for investments and trade liberalization.
  • Regulate wisely. We need long-term international policies, often called “enabling frameworks,” that are consistent and predictable, encouraging investment, securing property rights and promoting public-private partnerships for energy innovation.

The next administration must work closely with other nations, not just in established settings such as the UN, but in new arrangements that enable countries best placed to move forward to do so with a minimum of impediments.  It is a time for creative leadership, not dogma.

American business is ready to build our energy competitiveness in the global marketplace, to grow our economy and to move decisively towards a sustainable energy future.  We hope the next president is up to that same challenge.

For more information or to get involved, please contact USCIB’s Norine Kennedy  (212-703-5052, nkennedy@uscib.org).

Mr. Robinson’s bio and contact information

More on USCIB’s Environment Committee 

Other recent postings from Mr. Robinson:

Employers’ Vision of the ILO (Summer 2008)

New Financial Challenges on the Horizon (Spring 2008)

Trade Can Save the Climate (Winter 2007-2008)

From E-Commerce to the “Internet Economy” (Autumn 2007)

USCIB Regrets Breakdown in Doha Trade Talks, Urges Parties to Keep Offers on the Table

Published on July 30, 2008

3818_image002New York, N.Y., July 30, 2008 – The United States Council for International Business (USCIB), which represents America’s top multinational companies, expressed deep disappointment at the breakdown of the WTO’s Doha trade talks in Geneva.  It called on governments to keep their offers on the table as the basis for further negotiations.

“We deeply regret that ministers failed to deliver an ambitious, balanced and comprehensive result acceptable to all parties,” stated USCIB President Peter M. Robinson.  “So much has already been achieved, including important progress this past week.  We urge parties to find ways to build on these accomplishments going forward.”

Mr. Robinson said leaders in emerging market countries needed to demonstrate flexibility commensurate with their new weight in the global economy.  “In addition, established trading parties must continue to demonstrate collective leadership and willingness to compromise,” he stated.  “We support the efforts of Ambassador Schwab and her team in this regard.”

The timing of the latest setback is unfortunate because of slowing economic growth and increasing protectionist sentiment in some major trading nations, Mr. Robinson added.   He also pointed to the importance of freer trade and multilateral cooperation in confronting such challenges as climate change and resource scarcity.

USCIB believes the Doha Round has tremendous potential to increase global economic growth by improving market access for goods and services around the world, especially for the developing world by reducing south-south trade barriers.  It is the main opportunity to reduce distorting subsidies and trade barriers to agriculture.

USCIB has long supported multilateral liberalization of trade, investment and financial flows.  Together with its international affiliates, including the International Chamber of Commerce, and in partnership with other national industry groups in the ABCDoha coalition, USCIB strongly supported the launch of the Doha Round in 2001, and it has sought a result that would improve global market access for products and services.

USCIB promotes an open system of global commerce in which business can flourish and contribute to economic growth, human welfare and protection of the environment.  Its membership includes more than 300 leading U.S. companies, professional services firms and associations whose combined annual revenues exceed $4 trillion.  As American affiliate of three global business groups – the International Chamber of Commerce, the International Organization of Employers, and the Business and Industry Advisory Committee to the OECD – USCIB provides business views to policy makers and regulatory authorities worldwide, and works to facilitate international trade.

Contact:

Joseph G. Gavin, VP Trade & Customs, USCIB

+1 202.682.1291 or jgavin@uscib-dc.org

More on USCIB’s Trade and Investment Committee

WTO website

Closing Remarks by USCIB Peter Robinson to OECD Ministerial on the Future of the Internet

Published on June 18, 2008

Peter Robinson

President and CEO, United States Council for International Business

Closing Remarks for OECD Ministerial on the Future of the Internet

Seoul, June 18, 2008

 

Congratulations to Korea and the OECD on organizing such an impressive ministerial meeting!

The discussions over the last 3 days have been interesting and insightful in looking to the future and the role of all stakeholders along this path.

On behalf of the business community, let me applaud Ministers for signing a Declaration that lays out a clear path to the future Internet economy. We are especially pleased to see that our vision shares many of the same hopes and expectations as those that are outlined in the Declaration.

This Ministerial has successfully built on the previous Ministerial, which focused on e-commerce. The last 10 years have shown us that the Internet is much more than a new platform on which to conduct business.  It has become intertwined with every aspect of our lives and economies. The next 10 years will allow us to further realize the potential of the Internet to better our societies, both developed and developing, and to bring more of the world’s people online to create, communicate and collaborate as part of their business and personal lives.

Our vision of the future Internet is characterized by a virtuous circle of investment and innovation, fueled by creativity and empowering users. The future Internet will also be characterized by increased user participation and choice of applications, products and services provided through a wide variety of high capacity platforms that are more available, affordable and user-friendly. The Internet will facilitate greater productivity and expanded access, to, and quality of, education, skills development and healthcare. Innovative ICT solutions will help us address challenges such as the environment.

 

Role of business

The Ottawa ministerial established a precedent for a regulatory framework that recognized the need for private sector leadership and flexibility to enable innovation. Since, the convergence of voice, data, video and audio on the Internet, driven by the extensive deployment of competing IP-based networks, has enabled innovation to thrive , empowering consumers and enhancing opportunities for further growth and innovation.

Going forward, we need to understand how the next level of convergence will impact business. Further investment will be needed to provide adequate capacity, security and capabilities for future Internet-supported development and connectivity.  Business will also work with other stakeholders to develop market-driven technical standards that will enable the Internet’s ongoing expansion.

 

Creativity

The Internet is also facilitating an unprecedented level of collaboration and interaction in commercial as well as social settings. The application of ICTs to learning, health, the environment and professional and social networking enables the robust exchange of information and knowledge. A confluence of factors—has created a fertile environment for users to become creators and publishers in their own right.  Pervasive, speedy, intelligent and affordable broadband access, provided through capable high capacity networks is vital to the future growth of these and other innovative offerings. Preserving and fostering the incentive to create is also vital to the continued migration of content to the online world. The protection and enforcement of intellectual property rights, which supports and encourages users to make legitimate use of content, play an important role in this regard.

 

Confidence

Security and privacy will be increasingly important- not just because of increased threats, but also because emerging technologies may provide more seamless ways of collecting and using information. User trust and confidence in these new technologies will enable faster adoption and greater access to the benefits they can provide.

Today, businesses deploy a variety of technologies to meet customer needs and to build confidence in the online environment, and also actively leads educational initiatives in Internet privacy and safety.  While there is no silver bullet to stop cyber-crime, business is committed to working with governments and other stakeholders to effectively address this problem.

But in the end, improved education, innovative technology widespread dissemination and adoption of industry best practices; and effective law enforcement will be most effective in addressing these threats to Internet users’ privacy and safety and ensuring the continued integrity of the Internet.

 

Role of governments

We commend Ministers for their commitment to establish and maintain policy frameworks that will promote a trusted Internet-based environment, continued investment and increasing competition that will lead to expanded Internet access worldwide, increased innovation and user choice.  Indeed, such frameworks are essential for the future Internet economy.

Ministers have taken the important step to reaffirm the principles that enabled a new platform for commerce to evolve into a new platform for all aspects of life and declaring to contribute towards further development of the global Internet economy. While a framework that promotes continued technology innovation is crucial, we must keep in mind that ICTs are a means to achieve growth and societal benefit rather than an end in themselves.

 

The role of governments is fundamental for four key objectives:

  1. Ensuring that any new measures or incentives have a positive impact on infrastructure investment, innovation and the growth of the Internet
  2. Enforcing existing laws, particularly criminal laws, which address harmful and/or illegal online activities and coordination across relevant agencies and jurisdictions
  3. Recognizing the continued importance of market-driven, consensus-based global standards and the leadership of the private sector in their development
  4. Developing policies that stimulate the availability of and demand for network development, deployment, and interconnectivity, and the availability of different devices and modes of connectivity to increase Internet penetration

 

Role of OECD:

Finally, after Seoul,  as governments work towards further implementation of the commitments made here, careful attention should be paid to the important, unique and beneficial role that the OECD plays. The OECD will continue to be instrumental in working with all stakeholders to further the achievements of the Ottawa and Seoul Ministerial Conferences, in particular by producing neutral, fact-based economic reports that examine current market conditions and the impact of new developments, emerging technologies and any potential policy questions. The OECD also facilitates co-ordination and consistency of broad policy frameworks across Member economies by providing a forum for dialogue, involving all stakeholders.

In closing, I’d like to emphasize that all stakeholders must continue to work together, each according to their role, to address the challenges faced by the global economy, to promote the continued growth of the Internet and bring its benefits to more of the world’s people. Today, the private sector continues to lead the way in the innovation and development of ever-more efficient and focused services, applications, content, devices and networks that allow more users to share in the benefits of the Internet. We look forward to working with governments, civil society, the technical community and the OECD to nurture the powerful potential of the Internet economy.

More on USCIB’s Information, Communications and Technology Committee

OECD website

Employers’ Vision of the ILO Summer 2008

Published on June 1, 2008

From the President’s Desk:

Focusing international labor policy on entrepreneurship and enterprise creation

By Peter M. Robinson

Peter M. Robinson
Peter M. Robinson

Globalization and the integration of international markets have been a tremendous benefit for the countries that have prepared themselves to take advantage of the new opportunities they provide. But for those countries that have failed to adjust or reform, these forces have exposed systemic failures in national governance that have in turn led to considerable social upheaval due to increased competition and changing labor markets.

Since social pressures can present a considerable barrier to maintaining or expanding international integration, a key policy challenge for international business is to develop effective mechanisms that can help countries reform their domestic policies to respond better to new external pressures. One such mechanism, the International Labor Organization (ILO) – the UN agency responsible for international labor and social policy – could play a leading role in this effort, and business is taking the lead to make it more responsive to employers’ needs.

Focusing on Current Needs

Abe Katz At the IOE’s May General Council meeting in Geneva, USCIB President Emeritus Abe Katz officially concluded his two-year term as the IOE’s chairman, passing the baton to Prof. Wiseman Nkhulu of South Africa. Mr. Katz noted the continuing relevance of the ILO to the conduct of international business, particularly at a time when the relationship between trade and labor standards has become an important political issue. USCIB President Peter Robinson and Executive Vice President Ronnie Goldberg also hosted a dinner in honor of Mr. Katz attended by employer members of the ILO Governing Body, business and labor union representatives to the International Labor Conference, and senior U.S. government and ILO officials. Many in attendance worked with Mr. Katz during his years as USCIB’s president (1984-98), when he served on the ILO Governing Body. Toasts were made by numerous participants, including IOE Secretary General Antonio Peñalosa, IOE Executive Vice Chairman Daniel Funes de Rioja, International Trade Union Confederation Secretary General Guy Ryder, and ILO Director General Juan Somavia. All reflected deep respect and admiration felt by colleagues from all sides. USCIB and its members have deeply appreciated Abe’s leadership over the past 24 years.
Abe Katz
At the IOE’s May General Council meeting in Geneva, USCIB President Emeritus Abe Katz officially concluded his two-year term as the IOE’s chairman, passing the baton to Prof. Wiseman Nkhulu of South Africa. Mr. Katz noted the continuing relevance of the ILO to the conduct of international business, particularly at a time when the relationship between trade and labor standards has become an important political issue. USCIB President Peter Robinson and Executive Vice President Ronnie Goldberg also hosted a dinner in honor of Mr. Katz attended by employer members of the ILO Governing Body, business and labor union representatives to the International Labor Conference, and senior U.S. government and ILO officials. Many in attendance worked with Mr. Katz during his years as USCIB’s president (1984-98), when he served on the ILO Governing Body. Toasts were made by numerous participants, including IOE Secretary General Antonio Peñalosa, IOE Executive Vice Chairman Daniel Funes de Rioja, International Trade Union Confederation Secretary General Guy Ryder, and ILO Director General Juan Somavia. All reflected deep respect and admiration felt by colleagues from all sides. USCIB and its members have deeply appreciated Abe’s leadership over the past 24 years.

The main challenge in making the ILO more effective and relevant for the business community is to focus its machinery on developing practical and workable solutions to current social and labor policy challenges. The global business community took a significant step forward in this area when the International Organization of Employers (IOE) – one of USCIB’s key international affiliates – produced an Employers’ Vision of the ILO, a comprehensive business agenda for the ILO.

Developed under the direction of Abe Katz (see box), the outgoing chairman of the IOE and USCIB’s president emeritus, the Employers’ Vision presents a clear agenda for the ILO that promotes entrepreneurship and enterprise creation, the main ways jobs are created and sustained. The vision also calls for increased attention on productivity improvements through education, skills development and training.

The IOE also calls for international labor standards that are practical and implementable.  Many existing standards set goals so impossibly high that few countries ratify them, and those that do so are unable to enforce them. Similarly, the IOE paper stresses that the ILO must help countries reform labor laws and other regulations that stifle enterprise creation and job growth, and which force operators into the ineffective and constraining informal economy.

International Business Leadership

Changing the ILO will not be easy or painless. A key reason for hope is that the ILO has a tripartite structure that is unique in the UN, meaning that employers and trade unions share voting power with the ILO’s member governments and participate in its oversight and management. USCIB Executive Vice President Ronnie Goldberg was recently re-elected to a second term on the ILO Governing Body.

On a broader level, USCIB relies on the IOE to coordinate international business engagement in the ILO. I was able to see the IOE in action at the annual International Labor Conference in June, when representatives of the IOE’s 145 national affiliates from 138 countries gathered in Geneva to speak on behalf on their business communities. The IOE is poised to build on the considerable achievements of Abe Katz in his term as IOE chairman under the new leadership of Professor Wiseman Nkuhlu, chairman of Pan African Capital Holdings of South Africa.

For more information or to get involved, please contact USCIB’s Adam Greene  (212-703-5056, agreene@uscib.org).

Mr. Robinson’s bio and contact information

More on USCIB’s Labor and Employment Committee

Learn more about the IOE

Other recent postings from Mr. Robinson:

New Financial Challenges on the Horizon (Spring 2008)

Trade Can Save the Climate (Winter 2007-2008)

From E-Commerce to the “Internet Economy” (Autumn 2007)

Business and Human Rights, Revisited (Spring 2007)

WHO Briefing Focuses on Private-Sector Partnerships

Published on May 28, 2008
L-R: IOE President Abraham Katz, Ivan Ivanov (WHO), David Bell (Centers for Disease Control), Jeffrey Gilbert (Pfizer).
L-R: IOE President Abraham Katz, Ivan Ivanov (WHO), David Bell (Centers for Disease Control), Jeffrey Gilbert (Pfizer).

Last month, USCIB hosted a high-level meeting between business representatives, senior staff from the World Health Organization and officials from the International Organization of Employers to discuss workplace and employee health initiatives, and to identify opportunities for collaboration between WHO and business.

The meeting included briefings from companies on their worldwide operations, initiatives for employees and the community within which they operate, and company participation in public-private coalitions to effect broad-based change. The WHO representatives discussed current work on workplace and employee health, including opportunities for private-sector engagement.

Since the WHO work will also be implemented with national governments – focusing on developing countries – discussion included how business can coordinate country programs with WHO national initiatives.

One model partnership is the WHO’s efforts to reduce and eventually eliminate the use of leaded gasoline in developing countrie4s, especially Africa. Major petroleum and auto companies have worked with national governments, the United Nations Environment Program, the World Bank and other bodies to make lead-free gas – along with catalytic converters and more efficient automobiles – available in Africa. The resulting improvements in air quality have directly improved the lives of around a billion people.

Also participating in the meeting were senior representatives from the U.S. Centers for Disease Control, who updated participants on the WHO’s new International Health Regulations. Revised following the SARS epidemic, these regulations constitute the international legal framework for response during such epidemics by governments, the WHO and other stakeholders. Pandemic preparedness and coordination between business, supply chains, government and international organizations were also explored.

The meeting concluded with strong agreement that business is a key stakeholder for the WHO’s work in this field, and that there are many other opportunities where collaborations and partnership could be beneficial. There are concrete actions for follow-up, and a mutual desire to maintain an ongoing dialogue.

More on the International Organization of Employers

More on USCIB’s Health Care Task Force

Top Treasury Official Urges Openness to Foreign Investment Including Sovereign Wealth Funds

Published on May 19, 2008
Deputy Treasury Secretary Robert M. Kimmitt
Deputy Treasury Secretary Robert M. Kimmitt

Now more than ever, open investment policies benefit all countries, including the United States, a top Treasury Department official told USCIB members at a May 8 briefing in New York. Deputy Treasury Secretary Robert M. Kimmitt said the U.S. was concerned at rising barriers to investment in overseas markets and would work to curtail these, while seeking to keep U.S markets open.

Mr. Kimmitt said the U.S. was also working with the International Monetary Fund and the Organization for Economic Cooperation and Development to develop best practices for foreign investment from sovereign wealth funds, including standards of transparency and governance.

The briefing was hosted by law firm Sullivan & Cromwell at its Wall Street-area headquarters. Firm Chairman Rodgin Cohen presided along with USCIB President Peter M. Robinson.

Sovereign wealth funds have existed since the 1950s but only recently taken on a leading role in international finance, especially as countries reaping the benefits of export and oil booms seek to gain higher returns. Mr. Kimmitt said sovereign funds currently had an estimated $3 trillion in assets – a number he said could grow to over $12 trillion over the next five years.

“Sovereign wealth funds have been a force for good for the global economy,” stated Mr. Kimmitt. “They’ve been patient, long-term investors, not highly leveraged, they don’t shift asset allocations in times of distress. Even those who have raised the most significant hypothetical concerns cannot point to a single example in the past 55 years where a sovereign wealth fund has invested for other than commercial purposes.”

Nevertheless, he said the U.S. and other host countries “need to be vigilant as these funds grow significantly both in number and size.” Mr. Kimmitt said existing national security and antitrust rules would largely serve to address any concerns should sovereign investors seek to extend their role beyond this traditionally passive approach. But he also pointed to the IMF and OECD efforts as a way to increase openness on both sides of the investment equation.

Representatives of some two dozen sovereign wealth funds met with IMF officials on May 1 to begin work on transparency and governance guidelines for such funds. Mr. Kimmitt told USCIB members he expects the final set of guidelines to be presented at the IMF’s fall meetings.

Meanwhile, building on its established expertise in the area, the OECD is developing guidelines host governments on maintaining market openness in the face of new forms of investment such as sovereign wealth.

In introductory remarks, Mr. Robinson noted USCIB’s active role in helping Congress strike the right balance between market openness and national security in its recent revisions to the Exon-Florio law. He also cited a recent International Chamber of Commerce paper, “Recommendations to Safeguard Freedom of Investment,” which he said presented a strong framework for dealing with new investment challenges like sovereign wealth.

On May 13, as part of their high-level Transatlantic Economic Council meeting in Brussels, the U.S. and the European Union sought to quell rising protectionist sentiment in key markets by declaring their openness to outside investment, including sovereign wealth funds. They issued a joint statement condemning barriers to capital flows except on ground of protecting national security. Any such restrictions must be “transparent, predictable and proportionate,” they said.

More on USCIB’s Trade and Investment Committee

ICC paper, “Recommendations on Safeguard Freedom of Investment”

Event Spotlights Doing Business in Africa

Published on March 25, 2008
L-R: Peter Robinson (USCIB), Michael Klein (World Bank), Alex Cummings (Coca-Cola).
L-R: Peter Robinson (USCIB), Michael Klein (World Bank), Alex Cummings (Coca-Cola).

What are the lessons for African governments, and for global companies, in the latest edition of the World Bank’s benchmark “Doing Business” reports? This was the focus of a high-level World Bank briefing on March 12 at the University Club in New York, co-sponsored by USCIB and Coca-Cola Africa. The event attracted top African diplomats resident in New York, along with business representatives and others from the policy community.

The annual Doing Business report examines which countries make it easiest – and which hardest – to start and run a business. It compares ten indicators of business regulations across 178 countries, analyzing government regulations that enhance or restrain business activity, and it ranks countries on their overall ease of doing business.

USCIB hosted the launch of the 2008 Doing Business report in September of last year at an event featuring World Bank President Robert Zoellick.

The March 12 session featuredl Michael Kein, vice president for financial and private sector development at the International Finance Corporation, the World Bank’s private sector arm, who led an overview of the Bank’s criteria for ranking countries and the factors for success among the African countries that ranked highly in the latest report.

According to Mr. Klein, business conditions have improved in some parts of Africa. In 2006-2007, 28 countries in North and Sub-Saharan Africa implemented reforms that made it easier to start and run a business. Egypt, Ghana, and Kenya were among the top ten reformers worldwide in the Doing Business 2008 report, and they also made the most significant advances in the aggregate ease of doing business rankings among countries in Africa. Overall, Mauritius topped the rankings in Africa on the ease of doing business and placed 27th in the global rankings.

Peter M. Robinson, president of USCIB, also spoke at the event, as did Alexander B. Cummings, president and chief operating officer of the Africa Group at the Coca-Cola Company. Mr. Robinson offered the assistance of USCIB and its global network – especially the International Organization of Employers (IOE), which has a strong African network – in the development and promotion of future Doing Business reports. An IOE delegation met in February with Mr. Zoellick and other top World Bank representatives to discuss this and other cooperative measures.

USCIB will continue its efforts to promote awareness of the Doing Business report by co-sponsoring a high-level seminar and dinner in June, at the New York Stock Exchange, at which the top ten reforming countries will be recognized. Additional information on the Doing Business report is available at www.doingbusiness.org.