Trade and Investment Archives

News Brief High Standards Needed in U.S. – China Investment Treaty

Published on March 5, 2013

Columbia University’s Vale Center has published a short essay by Shaun Donnelly, USCIB’s vice president for investment and financial services, presenting the business case for a high-standards U.S.-China bilateral investment treaty (BIT). The essay appears in the center’s journal Columbia FDI Perspectives and is available by clicking here.

Donnelly’s piece responds to an earlier essay in the journal by Karl Sauvant and Huipeng Chen advocating a different approach toward the China BIT negotiations. He argues that it is essential to get a comprehensive, high-standard BIT with China, with meaningful market-opening liberalization as well as strong investor-state dispute resolution provisions, and not to settle for a quick compromise with lower protections just for the sake of getting a deal. Donnelly argues that both the U.S. and Chinese governments – as well as their respective business communities – need the strong protections and dispute-settlement provisions one can only get in a high-standard, 21st-century BIT.

USCIB is actively working to promote member views in the context of the U.S.-China BIT negotiations, and views a high-standards BIT as a key element in USCIB’s 2013 trade and investment agenda.

Staff contact: Shaun Donnelly

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WTO Aims to Strengthen Contacts With the Business Community

Published on March 1, 2013
L-R: ICC’s Stefano Bertasi, the WTO’s Keith Rockwell and Evian Group’s Carlos Braga
L-R: ICC’s Stefano Bertasi, the WTO’s Keith Rockwell and Evian Group’s Carlos Braga

At a February 21 event organized for the business community at the World Trade Organization’s Geneva headquarters, the WTO announced the results of a recent survey of businesses and launched a dedicated web area for business on the WTO website. It also launched an electronic newsletter targeted specifically at the private sector.

At the event, Stefano Bertasi, policy director at the International Chamber of Commerce (ICC), for which USCIB serves as American affiliate, provided an update on ICC’s World Trade Agenda initiative, and Carlos Braga of the Evian Group gave his perspective on the relations between business and the WTO.

“This meeting is the first of what we hope will be a series of encounters between the WTO and the business community through which we hope to strengthen our dialogue and our interaction,” said Keith Rockwell, the WTO’s director of information and external relations.

USCIB recently released its own 2013 trade and investment agenda, which is complementary to ICC’s initiative and focuses on completing trade agreements with Asia and Europe, moving forward with strong new bilateral investment treaties, including with China and India and revitalizing work in the WTO. USCIB’s agenda also aims to address new regulatory challenges around the world that bear on market access for U.S. trade and investment, including preferential treatment for state-owned enterprises and efforts by governments to impose forced localization requirements on companies as conditions for market access.

The aim of the new WTO web page is to make key information for the private sector, such as trade statistics and trade monitoring news, easily accessible in one dedicated area. The newsletter, which will be issued on a regular basis, includes the latest business-focused trade news from the WTO. It will be circulated electronically to all business representatives who register online.

Staff contacts: Rob Mulligan

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ICC website

Business Gearing Up for G20 Summit

Published on February 4, 2013

4433_image002Preparations for this year’s Group of 20 Summit, which takes place September 5-6 in Saint Petersburg, Russia, are well underway, with last year’s Mexican hosts essentially handing off to Russia in December. USCIB is working with all three of our affiliated global business bodies to advance a positive private-sector agenda at the summit, which will again feature a high-level business component known as the B20.

The International Chamber of Commerce is a leading member of the B20 organizing group, which is working with Alexander Shokhin, president of the Russian Union of Industrialists and Entrepreneurs, to facilitate business input to the summit. ICC plans to hold a number of preparatory events through its 30-member G20 Advisory Group – whose members include USCIB Chairman Terry McGraw
of McGraw-Hill and USCIB Trustee Andrew Liveris of Dow – and has published an informative update on its G20 activities.

Focus on apprenticeships

Both the International Organization of Employers and the Business and Industry Advisory Committee to the OECD are also taking part in preparations for the B20, with a special remit to engage with governments on labor and employment policy. As part of this, the two organizations have forged a joint initiative on apprenticeships as a follow-up to the Mexico B20 business commitments on employment. In December, they released an initial overview of national initiatives to promote apprenticeships and internships.

Building on their findings, IOE and BIAC plan to create a global company network for apprenticeships, with the aim of facilitating exchange of information and joint action, increasing the visibility of companies’ engagement in vocational education and training, and fostering dialogue with policy makers and other actors at the national and international level.

IOE and BIAC will again spearhead business representation to the G20 Labor Ministerial, which takes place July 18 in Moscow.

In addition, USCIB members met in Washington on January 31 with Fabrizio Pagani, head of the OECD’s “Sherpa” office for G20 and G8 affairs, to discuss OECD contributions to the G20 Summit and related matters. OECD Secretary General Angel Gurria participates in the G20 Summit along with the heads of several other international agencies.

 

New International Services Negotiations to Be Launched

Published on January 22, 2013

4424_image002Last week, U.S. Trade Representative Ron Kirk informed Congress that the Obama administration plans to enter into negotiations for a new international agreement on trade in services. With negotiations encompassing the United States and 20 other countries soon to be launched in Geneva, the initiative is one of a number of “plurilateral” efforts expected to be undertaken in the wake of failure to make meaningful progress toward completing the Doha Round.

According to USTR, the negotiation partners account for nearly two-thirds of global trade in services. In his letter to lawmakers, Kirk cited a recent Peterson Institute for International Economics study estimating that tradable services are five times less likely to be exported than manufactured products. The U.S. is the world’s largest service provider.

“This is an important new initiative, and one we will be following closely at USCIB,” said Rob Mulligan, USCIB’s senior vice president for Washington. “Services are an enormous and growing part of our economy and our overall trade. The opportunities to drive U.S. economic growth and jobs through a services plurilateral are quite significant.”

Mulligan said advancing the new services talks would be an important objective in USCIB’s trade and investment policy agenda for 2013. Other top priorities include concluding the Trans-Pacific Partnership talks, starting negotiations on a U.S.-EU trade and investment agreement, addressing forced localization regulations and expanding product coverage under the WTO Information Technology Agreement.

Among the other parties expected to take part in the talks are Canada, the European Union, Japan, Korea and Mexico. One country that is not an initial party to the negotiations is China. In 2006, USCIB and the United States Council Foundation published a study on U.S.-China trade in services, which foresaw growing export opportunities for services. According to USTR, the U.S. had a services trade surplus with China of $13 billion in 2011.

“Obviously, the opportunities in China and other emerging markets are tremendous,” said Mulligan. “But we understand and appreciate the need to work with like-minded countries to achieve the most ambitious liberalization possible. Hopefully other countries would join a services agreement down the road.”

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Natural Gas Exports: Seeking Synergy Between Environment, Energy and Trade Policy

Published on January 22, 2013
A tanker transporting liquefied natural gas
A tanker transporting liquefied natural gas

In the context of current discussions about the export of liquefied natural gas from the United States, we believe that fundamental principles of environmental, energy and trade policy that USCIB has supported over the years remain relevant.

USCIB has long championed expanded trade and investment, and the elimination of barriers to global commerce, including in the energy sector, under a rules-based system, and we support established WTO rules limiting export and import bans. Erecting new barriers to LNG exports would run counter to our past positions and efforts by the American business community to discourage restrictions by other countries.

Throughout our work to promote international cooperation on climate change and energy security, USCIB has advocated keeping all energy options on the table in the transition to a greener economy. In that connection, we have underscored the critical importance of open trade as a means to disseminate cleaner technologies and energy options, and have signaled the adverse environmental impacts of export bans.

Increased domestic supplies of natural gas are already providing a competitive edge for many U.S.-based manufacturers, with positive impacts on jobs both in the energy sector and in the economy as a whole. Many observers, including the International Energy Agency, predict that the United States will become a net energy exporter, which would have major economic and geopolitical ramifications. Additionally, there is potential for natural gas, with its much lower climate footprint, to surpass coal as the world’s number-two energy source.

We appreciate the concerns voiced about LNG exports, including the potential for increased U.S. energy costs, and these concerns should not be taken lightly. As U.S. companies operate in global markets, they need access to affordable and sustainable energy in order to remain competitive. With wise policy choices, the domestic energy revolution has the potential to bring major economic and environmental advantages to the U.S. business community, and to U.S. citizens.

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News Brief USCIB Urges Senate to Approve Inward Investment Bill

Published on December 11, 2012

Joining with five other leading business groups, USCIB has urged the U.S. Senate to move expeditiously to adopt the “Global Investment in American Jobs” bill (S. 3274) sponsored by Senators John Kerry (D.-Mass.) and Bob Corker (R.-Tenn.). Companion legislation passed the House unanimously in mid-September.

In a letter sent today to every member of the Senate, USCIB and the business groups underlined the importance of strong legislation to improve America’s ability to attract job-creating foreign direct investment (FDI) in today’s competitive global environment.

Noting that U.S subsidiaries of foreign headquartered companies already employ more than five million Americans across the country and are major exporters, we urged the Senate to pass this broadly supported bipartisan legislation without delay. Doing so, the letter states, would send a clear signal to the world that the United States welcomes FDI, and is prepared to identify and resolve barriers that may impede our ability to attract much-needed global investment.

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Business Welcomes Adoption of Russia Trade Bill

Published on December 6, 2012

4411_image001New York, N.Y., December 6, 2012 – The United States Council for International Business (USCIB) applauded today’s passage by the Senate of legislation to establish permanent normal trade relations (PNTR) with Russia.

“We welcome the Senate’s approval and urge President Obama to sign the measure as soon as possible,” said USCIB President and CEO Peter M. Robinson. “Since Russia joined the World Trade Organization in August, American companies have been at a competitive disadvantage in this important and fast-growing market.”

Once signed, the PNTR bill will sweep away outdated trade restrictions imposed on the then-Soviet Union in the 1970s under the Jackson-Vanik amendment. Russia is the world’s ninth-largest economy, but ranks only 31st as a market for U.S. goods exports.

With Russia also looking to join the Organization for Economic Cooperation and Development (OECD), the business community is looking to work with the U.S. government and others to further open Russia’s economy to foreign trade and investment, Robinson said.

About USCIB:
USCIB promotes open markets, competitiveness and innovation, sustainable development and corporate responsibility, supported by international engagement and regulatory coherence. Its members include U.S.-based global companies and professional services firms from every sector of our economy, with operations in every region of the world. 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.

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News Brief OECD Trade Committee Developments

Published on November 30, 2012

USCIB Senior Vice President Rob Mulligan took part in meetings earlier this month in Paris of the OECD Trade Committee and the BIAC Trade Committee, as well as the OECD Global Forum on Trade.  Mulligan was able to raise the issue of forced localization – the range of measures governments impose on foreign investors requiring local content, production and operations as a condition of investing – at senior levels in both organizations and among OECD member governments. Among the key developments was a decision to develop a new BIAC discussion paper on the issue.

Among other important developments:

  • For the first time, BIAC was invited to attend the plenary session of the OECD Trade Committee, including a session with the G20 on November 7. The OECD asked BIAC for its views on several issues including trade in services, trade and employment and global value chains.
  • During the meeting, BIAC highlighted business concerns about protectionist tendencies (e.g. increase of tariffs, indirect measures, forced localization) and supported the OECD, WTO and UNCTAD in calling on G20 governments to step up efforts to resist protectionism in the face of continuing high unemployment and a weak economic recovery.
  • BIAC welcomed the increased role of the OECD in the G20 process, and underlined that together with our members, we look forward to providing business input to the Russian G20 presidency through the B20 and the OECD.

 

Joining Mulligan at the November 8 OECD Global Forum on Trade was USCIB member Josh Kallmer (Crowell & Moring), who participated in a panel discussion, “More Competitive Services Markets: What Can We Do?”

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USCIB Applauds House Passage of Russia Trade Bill

Published on November 16, 2012

4405_image001New York, N.Y., November 16, 2012 – The United States Council for International Business (USCIB) welcomed the House of Representatives’ passage today of legislation to establish permanent normal trade relations (PNTR) with Russia.

“This is a long-overdue step to secure U.S. access to the growing Russian marketplace,” said USCIB President and CEO Peter M. Robinson. “Russia joined the World Trade Organization in August, and in the intervening time, U.S. companies have been at a competitive disadvantage as the country opens up new opportunities for foreign trade and investment. We urge the Senate to swiftly approve PNTR legislation.”

Passage of PNTR is required to lift trade restrictions on Russia under the 1970s-era Jackson-Vanik amendment, which has been deemed to violate WTO rules.

Robinson noted that Russia is also taking steps to join the 34-nation Organization for Economic Cooperation and Development (OECD), which would entail additional steps to open Russia to foreign trade and investment. Through its membership in BIAC, the Business and Industry Advisory Committee to the OECD, USCIB is working to advise the OECD and its member governments on appropriate terms for Russian entry into the organization, and is assessing the potential impact for U.S. business.

About USCIB:
USCIB promotes open markets, competitiveness and innovation, sustainable development and corporate responsibility, supported by international engagement and regulatory coherence. Its members include U.S.-based global companies and professional services firms from every sector of our economy, with operations in every region of the world. 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.

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New Portal Showcases Benefits of Open Markets for FDI

Published on October 16, 2012

4394_image001New York, N.Y., October 16, 2012 – The United States Council for International Business (USCIB) today joined with six other business associations to launch a new online information clearinghouse, Investment Policy Central, highlighting the importance of an open climate for foreign direct investment in driving U.S. economic growth, trade and jobs.

“USCIB has long been a leading voice for open investment policies, on both inward and outward FDI flows,” stated USCIB President and CEO Peter M. Robinson. “We are excited about this new website as way to spread our message, and those policies, more widely.”

Investment Policy Central is now live at www.investmentpolicycentral.com.

The business groups said Investment Policy Central will serve as a center of excellence for the most accurate, up-to-date information on the benefits of an open international investment climate. The site presents facts and figures on investment, highlights the benefits of global investment, debunks common investment myths and provides links to a wide range of resources on investment policy.

Investment Policy Central will feature timely, relevant content from experts on investment policy. Site organizers said they would welcome suggestions and input from companies, associations, organizations, think tanks, academics and other individuals interested in promoting an open international investment climate.

One of USCIB’s initial contributions to the site is an overview of recently updated guidelines for international investment from the International Chamber of Commerce (ICC), the worldwide business body that is part of USCIB’s global network. The ICC guidelines elaborate a number of steps both governments and companies can take to ensure maximum benefits from international investment.

“USCIB will continue to lead a strong advocacy and education effort on behalf of open investment policies,” Robinson said. “Our message is simple: FDI, both inward and outward, is good for the U.S. economy, for our competitiveness in today’s global marketplace, for U.S. companies and for U.S. jobs.”

The United States is the world’s leading investor nation as well as the largest host country for foreign direct investment. Overall, global inward investment flows now approach $1.2 trillion, and sales of affiliates worldwide are just under $30 trillion, far in excess of world trade flows.

In addition to USCIB, the partner associations in the Investment Policy Central initiative include the Coalition of Services Industries, Emergency Committee for American Trade, National Center for APEC, National Foreign Trade Council, Organization for International Investment and U.S. Chamber of Commerce.

About USCIB:

USCIB promotes open markets, competitiveness and innovation, sustainable development and corporate responsibility, supported by international engagement and regulatory coherence.  Its members include U.S.-based global companies and professional services firms from every sector of our economy, with operations in every region of the world.  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 at www.uscib.org.

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