Archive for the ‘Trade Agreements’ Category

h1

Energized by the Baltic Region

February 25, 2014

Matthew Murray is the International Trade Administration’s Deputy Assistant Secretary for Europe, Middle East and Africa. 

Deputy Assistant Secretary Matthew Murray spoke to members of the American Chamber of Commerce in Estonia about trans-Atlantic trade.

Deputy Assistant Secretary Matthew Murray spoke to members of the American Chamber of Commerce in Estonia about trans-Atlantic trade.
(photo courtesy AmCham Estonia)

I believe in the power of trade and investment. These are key components to a strong bilateral relationship, and they have the power to strengthen important bonds between countries.

By working with the regions of Europe, the Middle East, and Africa, my team and I can focus on some of the United States’ cornerstone partnerships. Even with countries that are considered small in terms of population size or territorial expanse, our commercial relationships create jobs, support development, and foster shared ideals of entrepreneurial support and innovation.

In the dynamic markets of Estonia, Lithuania, and Latvia, there is more potential for economic and job growth than one may otherwise expect. I strongly believe that establishing synergies between U.S. and Baltic companies will forge cutting-edge business partnerships that lead to new, dynamic jobs for all countries involved.

The Transatlantic Trade and Investment Partnership (TTIP) agreement currently under negotiation between the United States and the European Union (EU) is a vital tool for deepening U.S. commercial ties to the Baltic region. The partnerships will create new opportunities for U.S. and Baltic companies to export their goods and services to the larger, transatlantic marketplace.

I recently traveled to Estonia and Lithuania in pursuit of input from U.S., Estonian, and Lithuanian businesses, as to how the United States and the EU should advance TTIP negotiations in 2014. To amplify the message of the September Baltic Summit here in Washington, I emphasized the critical role Baltic companies play as TTIP stakeholders.

Baltic business leaders are setting a world standard in innovation and in a start-up business culture. They are participating in the global marketplace, sharing their products and best practices, and investing in markets like the United States. We welcome their investment and their contributions to the global marketplace.

As the region advances its infrastructure to accelerate development, American businesses are ready to support this growth with unmatched global experience and expertise. Infrastructure developments will allow the region to accelerate its development.

Infrastructure developments also help attract foreign direct investment (FDI) to the region. Kinze, a U.S. agricultural equipment manufacturer, is one such company that chose to invest in Lithuania as a manufacturing hub. Increased FDI is an important development in our bilateral relationship, a topic about which you can read further in this translated interview I conducted with the Lithuanian business publication, Verslo zinios.

As the U.S. commercial relationship within the Baltic region progresses, our team is standing by to support American businesses interested in or already operating in the Baltic region. Please contact Jen Levine, Commerce’s Nordic Baltic Trade Specialist in Washington to link you with commercial opportunities in the Baltic and Nordic region.

h1

How New Legislation will Support Our Textile Industry

October 9, 2012

Kim Glas is the deputy assistant secretary for textiles and apparel within the International Trade Administration’s Import Administration division.

Deputy Assistant Secretary Kim Glas and Under Secretary Francisco Sanchez tour Unifi's sewing thread manufacturing facility in Yadkinville, North Carolina on October 9, 2012.

Deputy Assistant Secretary Kim Glas and Under Secretary Francisco Sanchez tour Unifi’s sewing thread manufacturing facility in Yadkinville, North Carolina on October 9, 2012.

I am visiting North Carolina today with the Under Secretary of Commerce for International Trade Francisco Sánchez to see first-hand two state of the art textile companies – Unifi and A&E. Recently, President Obama signed into law an important set of technical fixes to the U.S.-Dominican Republic-Central America (CAFTA-DR) Free Trade Agreement that will have a direct impact on jobs at these two companies and sewing thread manufacturers across this state and country.

When the Agreement with our Central American neighbors was negotiated in 2003, there was a definitional loophole that incentivized the use of non-U.S. sewing thread in the assembly of textile and apparel products. As a result of this loophole, U.S. sewing thread manufacturers have seen their business and employment shrink. The Obama Administration immediately set out to address a problem that severely impacted U.S. sewing thread manufacturers.

After years of hard work, President Obama recently signed legislation to close a loophole that has jeopardized businesses and jobs in the U.S. As a result, on Saturday, October 13th, these fixes will be implemented and will have a direct impact on many sewing thread manufacturers in North Carolina. We have every expectation that once the legislation is implemented that U.S. sewing thread producers like Unifi and A&Ewill be able to recapture market share in the critical market.

This is a prime example of what can be accomplished when industry, Congress, and the Administration work toward a common goal.

h1

A Primer on the Asia-Pacific Economic Cooperation or APEC

August 8, 2012

This post contains external links. Please review our external linking policy.

Tyler Voorhees is working in the Office of Public Affairs at the International Trade Administration for the summer. He is starting his senior year at Washington and Lee University in Lexington, Virginia.

We hope you enjoyed our month of covering transportation related exports in July. We talked about everything from the Farnborough Air Show to how remanufactured goods (including autos) can save your wallet and the environment.

During August, we will be highlighting the Asia-Pacific Economic Cooperation (APEC) forum. APEC may not be a familiar topic outside international trade circles; however, it plays a vital role in the U.S. economy.

Under Secretary Sanchez (left) making remarks on innovation and Intellectual Property Rights at APEC St. Petersburg. (Photo APEC)

Under Secretary Sanchez (left) making remarks on innovation and Intellectual Property Rights at APEC St. Petersburg. (Photo APEC)

APEC was founded in 1989 to promote trade liberalization in the Asia-Pacific Region. Today, APEC has 21 members, including the United States and some of its largest trading partners such as Canada, Mexico, China and Japan. Together, the region is home to 40 percent of the world’s population, but accounts for approximately 54 percent of the world’s gross domestic product (GDP) and 44 percent of world trade.

Originally, APEC was founded because of the growing interdependence of Pacific Rim economies. Over the past two decades, this interdependence has only increased, giving the organization growing importance each year. The broad goal of APEC is to decrease trade and investment barriers, facilitate business in the region while working to raise living standards across the region through sustainable economic growth and ultimately lead to a Free Trade Area of the Asia-Pacific.

Between 1989 and 1992, APEC met at a senior official and Ministerial level. In 1993, President Bill Clinton established the practice of an annual APEC Economic Leaders’ Meeting. Since then, APEC leaders have gathered annually during “Leader’s Week” to meet and discuss economic and trade issues in the region.  In 2011, the U.S. hosted the APEC meetings on a variety of topics ranging from addressing business ethics and standards to small and medium-enterprise growth and women’s issues.

Last year, Leader’s Week took place in Honolulu, Hawaii. This year, Russia is set to host the meeting in Vladivostok, the largest Russian port in the Pacific. There have been several ministerial meetings throughout the year, but Leader’s Week is scheduled to take place September 2-9.

This year, Under Secretary for International Trade Francisco Sánchez led the U.S Delegation to the Small and Medium-size Enterprises (SME) Ministerial Meeting in St. Petersburg on August 3rd. There, he discussed the importance of SMEs to economic growth and international trade. Make sure to follow our blog for a  report of the SME meetings.

h1

Growth Opportunities for U.S.-Colombia Textile Trade

May 21, 2012

Laurie Mease is a Business & Industry Specialist with the International Trade Administration’s Office of Textiles and Apparel (OTEXA).  Richard Stetson is an International Trade Specialist with OTEXA.

Yarn and fabric trade between the United States and Colombia has grown by more than 30 percent since 2002. And with the recent implementation of the U.S.-Colombia Trade Promotion Agreement, this figure is destined to grow in the coming years.

In 2008, we had the opportunity to visit Medellín, Colombia to participate in the Colombiatex trade show. We visited eight manufacturing facilities and were impressed with the diversity, sophistication, and maturity of the Colombian textile and apparel industry. We observed significant capital investment in machinery and technology. Many of the manufacturers have operations which encompass all of the necessary manufacturing processes under one roof: they spin yarn, knit and weave fabric, and assemble apparel. Unlike most of the textiles and apparel produced in Central America and the Caribbean, the majority of Colombia’s products are intended for sale in Colombia’s domestic market or for export to Venezuela, Mexico, and other markets in Latin America.

Related:

U.S.-Colombia Trade Promotion Agreement Now in Force!

Yarn loaded in production machinery at Fabricato, a Medellin-based textile manufacturer. (Photo Colombiatex)

Yarn loaded in production machinery at Fabricato, a Medellin-based textile manufacturer. (Photo Colombiatex)

Many of Colombia’s textile and apparel inputs, including fibers, yarns, and fabrics, are purchased from U.S. suppliers. Until the entry into force of the U.S.-Colombia Trade Promotion Agreement (TPA), these inputs have been subject to duties of up to 20 percent, with the exception of inputs used in apparel qualifying for trade preferences under the Andean Trade Promotion and Drug Eradication Act (ATPDEA). With the TPA in place, tariffs will be eliminated, reducing costs, and providing greater incentive for Colombian firms to buy U.S. fibers, yarns, and fabrics and for U.S. firms to invest in Colombia.  It’s a win-win for both the U.S. and Colombian textile and apparel industries.

In addition to duty-free benefits, the TPA contains several important flexibilities and protections to make sure that the U.S. industry is not harmed by the flow of imports from Colombia. For example, the TPA contains a textile-specific safeguard mechanism that allows most favored nation (MFN) tariffs to be temporarily re-imposed if a surge in duty-free imports from Colombia is shown to be causing or threatening to cause serious damage to domestic industry. The TPA also includes specific customs cooperation language for enforcing measures affecting trade in textile and apparel goods to help prevent the circumvention of the agreement’s rules on the origin of inputs and finishing processes.

As the TPA enters into force, we’re already starting to see signs of growth in U.S. textile and apparel sales to Colombia. U.S. exports of textiles and apparel to Colombia in 2011 were up 33 percent over 2010, with exports totaling $165 million in 2011.  Exports should further increase over the next few years due to the immediate duty-free market access for all qualifying textile and apparel goods entering Colombia under the TPA.  U.S. textile producers will have more opportunities than ever before to sell their goods in the Colombian market.

On the flip side, apparel imports from Colombia have been declining since 2005.  There are several possible explanations for this decline, including the end of global quotas for textile and apparel goods in 2005, the global economic downturn of 2008/2009, and, most recently, the uncertainties surrounding sourcing from Colombia.  Between the ATPDEA being enacted and terminated five times, and the stalled and unknown implementation date of the TPA, U.S. importers have been hesitant to source from Colombia.  With the implementation of the TPA on May15, no expiration date for duty-free benefits, and certain beneficial textile provisions, we expect sourcing of apparel from Colombia to gradually increase.

There is a wealth of information available on our website for companies interested in taking advantage of the new sales opportunities offered by the U.S.-Colombia TPA. Please visit our website or contact us via email OTEXA_Colombia@trade.gov with any questions.

h1

U.S.-Colombia Trade Promotion Agreement Now in Force!

May 15, 2012

Christopher Blaha is a Senior International Economist within the Office of Trade and Policy Analysis and Julie Anglin is the Colombia Desk Officer within the International Trade Administration.

Today more than 80 percent of U.S. exports of consumer and industrial products to Colombia become duty-free as part of the U.S. – Colombia Trade Promotion Agreement. This includes agricultural and construction equipment, building products, aircraft and parts, fertilizers, information technology equipment, medical scientific equipment, and wood. Also, more than half of U.S. exports of agricultural commodities to Colombia become duty-free, including wheat, barley, soybeans, high-quality beef, bacon, and almost all fruit and vegetable products.

Related:

Growth Opportunities for U.S.-Colombia Textile Trade

The agreement also provides significant new access to Colombia’s $180 billion services market, supporting increased opportunities for U.S. service providers. For example, Colombia agreed to eliminate measures that prevented firms from hiring U.S. professionals, and to phase-out market restrictions in cable television.

Prior to the enactment of this agreement, the average tariff that U.S. manufactured goods faced entering Colombia was 10.8 percent. With entry into force today, Colombia’s average tariff rate for manufactured goods from the United States has been reduced to 4 percent.

Colombia Snapshot

Colombia’s 2012 real GDP growth is forecasted at 4.7 percent by the IMF’s World Economic Outlook, remaining around 4.5 percent through 2017.

Colombia’s demand for imports has soared since 2001.  Colombia’s merchandise imports from the world have more than quadrupled over that period climbing from $12.8 billion in 2001 to $54.7 billion in 2011.

The United States remains the largest supplier to the Colombian market, with Colombian imports from the U.S. in 2011 totaling $13.7 billion, or one-quarter of Colombia’s imports.

Imports from the United States in 2011 were led by mineral fuels, machinery, aircraft and organic chemicals. Those four categories accounted for over half of Colombia’s imports from the U.S.

Other top Colombian import markets include China, Mexico and Brazil. The U.S. is the largest market for Colombia’s exports, representing nearly 40 percent of the Colombian export market.

The impact of the tariff reductions of U.S. exports to Colombia will be immediate for many products; including recreational vehicles, like motorcycles and pleasure boats (Colombia’s average tariff on U.S. exports will be reduced from 13.7 percent to 5.4 percent today) and agricultural equipment, like tractors and harvesters (Colombia’s average tariff will be reduced from 10.8 percent to 3.1 percent today). This will make U.S. manufactured products much more competitive and could also potentially boost sales.

The economies of the United States and Colombia are largely complementary in terms of the goods each exports to the other. For example, Colombia is a large importer of grains from the United States while it exports a number of tropical fruits to our country. In addition, U.S. cotton, yarn and fabric exports to Colombia are used in many apparel items that Colombia exports to the United States.

Facts about U.S. – Colombia Trade:

  • Between 2001 and 2011 U.S. goods exports to Colombia quadrupled, growing from $3.6 billion in 2001 to $14.3 billion in 2011. U.S. goods exports in 2011 were 19 percent higher than the previous year.
  • Colombia has grown from being the 33rd largest market for U.S. goods exports in 1991 to become the 22nd largest market in 2011.
  • Manufactured goods represented 92 percent of U.S. goods exports to Colombia in 2011.
  • Increasing exports to Colombia has benefits at the local level as well as the national. In 2011, more than half of U.S. States (26 total) reported merchandise export shipments to Colombia above $75 million.
  • In 2011, the largest state exporters of merchandise to Colombia included Texas ($5.1 billion), Florida ($2.8 billion), Louisiana ($894 million), California ($534 million) and Illinois ($454 million).
  • Houston and Miami are also major metropolitan area exporters to Colombia.

The provisions of the agreement and the resulting tariff cuts present new opportunities for U.S. companies and give U.S. exporters an advantage over exporters from Colombia’s non-FTA partners. The International Trade Administration maintains a database that helps exporters monitor when tariffs on specific products go to zero. The FTA Tariff Tool currently has information relating to manufactured products.

h1

Asia Pacific Business Outlook: Twenty Five Years and Many More Opportunities

March 27, 2012

This story is part of an ongoing series highlighting the information available to participants in the 2012 Asia Pacific Business Outlook (APBO)

Francisco Sánchez is the Under Secretary of Commerce for International Trade

This is my second year keynoting the 25-year old USC Marshall School’s Asia Pacific Business Outlook (APBO) Conference. It was great to see the diversity of participants, from representatives of businesses across the United States, as well as non-profit organizations, chambers of commerce, and trade associations from both the United States and countries in Asia and Latin America.

Under Secretary of Commerce for International Trade Francisco Sánchez speaks during the APBO Conference

Under Secretary of Commerce for International Trade Francisco Sánchez speaks during the APBO Conference (Photo USC Marshall School of Business)

It seems as though it’s also a reunion and convergence of sorts of 16 Senior Commercial Officers (SCOs) from Asia and local Commercial Service trade specialists. For the first time, we have the SCOs from Brazil and Russia joining the conference, contributing their insider knowledge and providing market briefings in one-on-one counseling sessions.

During my address yesterday, I was able to outline our ongoing priorities here at the International Trade Administration and across the Obama Administration as well as provide updates on some major accomplishments achieved in the past few years.

This month marks the two-year anniversary of the President’s National Export Initiative and good things are happening. Last year, U.S. exports surpassed $2 trillion for the first time in history. They supported nearly 10 million jobs, an increase of more than a million when compared to 2009 numbers. So the formula is pretty clear: exports benefit jobs, businesses and the national economy. That’s why we’ve got to continue to increase U.S. exports.

One of the areas with the greatest potential for this work is the Asia-Pacific region. It represents 55 percent of global GDP and accounts for 44 percent of world trade. And all of us at the Commerce Department are committed to keeping the U.S.- Asia-Pacific partnership growing — both through our words and our work.

Last year, I led the largest-ever higher-education mission to Indonesia and Vietnam. I visited Hong Kong and China last fall. And, earlier this month I was in Japan and Vietnam a second time to advance commercial relations. Our work in this region is a priority for us. And good things are happening.

U.S. goods exports to the broader Asia-Pacific totaled nearly $900 billion in 2011, a 15 percent increase from 2010. This is equal to 60 percent of total U.S. goods exports to the world. This partnership is generating benefits for all sides. This means jobs and growth for the American economy. In turn, U.S. products and services are helping to fuel the economic development in the Asia Pacific.

These have been win-win partnerships. Now, we’re focused on producing even more wins. To do this, the Administration is working from the policy level to the community level. For instance, one win came recently when the U.S.- Korea Trade Agreement took effect.

Before, in a variety of sectors, U.S. companies had to pay a tariff rate to sell their goods and services in Korea. Now, many of these same companies can enter the market duty-free. Almost 80 percent of American exports of industrial products to Korea will enter without getting taxed. Estimates are that this will lead to roughly $11 billion in additional U.S. exports. It will also provide new opportunities in the 12th largest economy in the world. That’s a big win.

Another win involves the Trans-Pacific Partnership. As many of you know, it’s an ambitious, high-standard trade agreement for doing business in the Asia-Pacific. It seeks to address new and emerging trade issues and 21st-century challenges. Working with our colleagues at the Office of the United States Trade Representative — we are addressing traditional trade issues involving goods and services;  rules on intellectual property; and technical barriers to trade. And we are making progress. A TPP framework was agreed to in Honolulu at the APEC Leaders’ meeting in November. It was a landmark accomplishment. The agreement identified five central features that nations around the world are already viewing as a new standard for trade agreements.

The Commercial Officers from across Asia, Russia and Brazil as well as the domestic trade specialist stand ready to help U.S. businesses explore the possibilities that are out there. There were some great conversations today.
This is a chance to achieve common goals, such as creating more markets and customers for U.S. businesses, which can lead to more sales, which will boost U.S. exports, which supports jobs and strengthens the American economy. These are big goals that will make a big impact.

And I look forward to working with all of you in the years ahead to achieve these goals.

So let’s get the conversation started.

h1

How U.S. Companies Can Start Taking Advantage of the U.S.-Korea Trade Agreement

March 6, 2012

The Office of Japan and Korea within the Market Access and Compliance unit of the International Trade Administration assists U.S. firms that are encountering trade and investment barriers in Japan and Korea.

The U.S.-Korea Trade Agreement will enter into force on March 15, 2012.

What does that mean for our companies – both those who are already doing business in Korea as well as those who are considering entering the Korean market for the first time?  How can companies ensure that their products will receive preferential treatment on or after March 15?South Korean flag and images of South Korea

On the first day the agreement takes effect, March 15 of this year, almost 80 percent of U.S. exports to Korea of consumer and industrial products can be imported duty-free. Nearly 95 percent of remaining tariffs will be eliminated within 5 years after that date, and most remaining tariffs will be eliminated within 10 years.

A web-based resource created by the International Trade Administration, the FTA Tariff Tool, is a great way to see if your product would benefit under the agreement. The database conveniently links to the latest U.S. tariff schedule and relevant rules of origin, helping you to determine the exact tariff benefit for your product and the rate at which the tariff is eliminated.

Additionally, nearly two-thirds of all U.S. exports of agricultural products to Korea will become duty-free starting March 15. This agreement also includes a number of significant non-tariff commitments that will come into force on March 15, including obligations to be transparent when developing and passing new regulations and laws that affect bilateral trade.

Commitments on strengthened protections for intellectual property rights benefiting American creators and innovators will also come into force on that day. Finally, commitments opening Korea’s $580 billion services market will also be in effect beginning March 15.

To ensure that your company’s product will benefit under the agreement, you will need to determine that the product is originating in either the territory of the United States or Korea under the rules of the agreement, and claim U.S.-Korea trade agreement benefits when importing.

U.S. Customs and Border Protection (CBP) will soon publicly release implementation instructions and interim regulations regarding U.S. imports under the agreement. Importers should closely monitor CBP’s FTA website and send inquiries on U.S. imports directly to fta@dhs.gov.

For more information, you can also contact your local U.S. Export Assistance Center and the U.S. Commercial Service at the American Embassy in Seoul, Korea.

The International Trade Administration’s U.S.-Korea Trade Agreement Portal should be your next stop!

h1

Taking Advantage of Opportunities in Colombia

December 29, 2011

Walter Bastian is the Deputy Assistant Secretary of Commerce for the Western Hemisphere in ITA’s Market Access and Compliance unit.

I recently participated in a forum focusing on how the new U.S.-Colombia Trade Promotion Agreement (Agreement), signed into law by President Obama in October, provides opportunities for expanded trade between our two countries.   Representatives from more than 100 U.S. and Colombian businesses attended the event in Bogotá organized by the Colombian American Chamber of Commerce.

Colombia is the 3rd largest economy in Central and South America, and one of our most important strategic partners in the region. I am impressed by Colombia’s level of economic liberalization and diversification of exports, and its sustained investment in information technologies. Furthermore, the country has greatly improved its corporate governance standards, and the United States and Colombia have largely complementary economies.

U.S. companies should prepare to take full advantage of the U.S.-Colombia Trade Promotion Agreement. When implemented, the Agreement will eliminate barriers to billions of dollars of U.S. exports, and increase U.S. market access for goods and Colombia’s $166 billion services market. Nearly 75 percent of duties on industrial and agriculture goods from the United States will be terminated immediately, and almost all other duties phased out during the next 5-10 years.

The Agreement is expected to increase U.S. exports by at least $1 billion annually and U.S. Gross Domestic Product by more than $2.5 billion. Key industry sector opportunities include information technology products, agriculture and construction equipment, infrastructure and machinery, chemicals, remanufactured and medical equipment, electrical power generation and distribution equipment, and aircraft and parts.

The Agreement also advances President Obama’s National Export Initiative which aims to double overall U.S. exports by the end of 2014, creating new opportunities for U.S. businesses, workers, farmers and ranchers.

We want to make sure that we support U.S. companies’ competitive position in Colombia and facilitate two-way trade. Colombia is doing the right things to get their house in order—they have significantly improved their business climate and are aggressively working to make it even better.

With a population of 48 million consumers in an economy with a growing GDP, Colombia is an attractive market for the United States. The International Monetary Fund (IMF) is expected to peg its Colombian 2011 economic growth forecast to close to 5 percent. According to World Bank’s Doing Business Report, Colombia is the region’s leading reformer, ranking 37th among 183 economies—and remains among the world’s 10 most active reformers.

For assistance in doing business in Colombia, U.S. businesses can contact their local U.S. Commercial (CS) Export Assistance Center at www.export.gov, or visit the Commercial Service at the U.S. Embassy in Bogotá.

h1

Making the Asia-Pacific Region a Top Priority for U.S. Trade

December 7, 2011

At the annual meeting of senior economic leaders from the 21 member economies of the Asia-Pacific Economic Cooperation forum held in Honolulu, Hawaii, this November, the United States reaffirmed its trade ties with the region and looked to pursue even more opportunities through the Trans-Pacific Partnership.

John Ward is a writer in the International Trade Administration’s Office of Public Affairs.

The Pacific Rim, which includes trading partners both large (China and Russia) and small (Brunei Darussalam), plays a vital part in the overall health of the U.S. economy and especially its export position. In 2010, the economies that make up the Asia-Pacific Economic Cooperation (APEC) forum, which includes 21 members from throughout the region, accounted for 61 percent of U.S. exports of goods ($775 billion) and more than 37 percent of U.S private services exports ($205 billion). About 5 million U.S. jobs are supported by these exports.

President Obama noted this economic reality when he spoke recently at the APEC Economic Leaders’ Meeting, which was held on November 13, 2011, in Honolulu, Hawaii. “The United States is, and always will be, a Pacific nation. Many of our top trading partners are in this region. This is where we sell most of our exports. … And since this is the world’s fastest growing region, the Asia Pacific [region] is key to achieving my goal of doubling U.S. exports.”

James McNerney, Jr., president and CEO of The Boeing Company (left) and President Barack Obama (right) at the APEC 2011 CEO Summit that was part of this year’s APEC events held in Honolulu, Hawaii (photo courtesy APEC)

James McNerney, Jr., president and CEO of The Boeing Company (left) and President Barack Obama (right) at the APEC 2011 CEO Summit that was part of this year’s APEC events held in Honolulu, Hawaii (photo courtesy APEC)

Ease of Doing Business

To enhance bilateral efforts already underway, the U.S. strategy to reach this goal in the Asia-Pacific region has been focused most recently on APEC. Established in 1989, APEC is the premier forum in the region to advance free and open trade and investment. As articulated in the organization’s 1994 Leaders’ declaration, the so-calledBogor Goalscommit APEC to working toward building “a dynamic and harmonious Asia-Pacific community by championing free and open trade and investment, promoting and accelerating regional economic integration, encouraging economic and technical cooperation, enhancing human security, and facilitating a favorable and sustainable business environment.”

In order to make concrete progress toward its goals, APEC holds working meetings and workshops throughout the year. These often include private-sector participants and on such topics as standards, environmental goods, and electronic commerce.

In 2009, APEC launched its Ease of Doing Business Action Plan. It identified five priority areas for improving the business environment in APEC economies: (a) starting a business, (b) getting credit, (c) trading across borders, (d) enforcing contracts, and (e) dealing with permits. The action plan set an APEC-wide aspirational target to make it 25 percent cheaper, faster, and easier to do business within the APEC region by 2015, with an interim target of a 5 percent improvement by 2011.

APEC’s efforts are already meeting with success: According to a recent study conducted by APEC’s independent research unit, between 2009 and 2010 improvement in the five key areas was 2.8 percent, exceeding the organization’s benchmark of 2.5 percent, and putting it well on the way to achieving its interim goal for 2011.

Related: ITA’s Anti-Corruption Efforts at APEC

2011: U.S. Host Year

The annual APEC Economic Leaders’ Meeting was chaired this year by President Obama in Honolulu. It was the culminating event of a year-long series of meetings hosted by United States. At four main clusters of meetings during 2011, delegates from each of APEC’s 21 member economies participated in various committee meetings, workshops, and ministerial meetings, focusing on three main areas set forth by the United States in its role as the host economy: (a) strengthening regional economic integration and expanding trade, (b) expanding regulatory cooperation and advancing regulatory convergence, and (c) promoting green growth.

The United States also led broad initiatives at APEC this year, including ones on women and the economy, food security, travel facilitation, cross-border privacy rules, and good governance and business ethics. The Department of Commerce played a key role in all of the initiatives that were led, or supported, by the U.S. government.

Trans-Pacific Partnership

One development with far-reaching potentials for trade in the region was the announcement by leaders of the nine Trans-Pacific Partnership (TPP) countries of the broad outlines of the TPP agreement. TPP is intended to be a regional trade agreement. Unlike the voluntary nature of agreements negotiated among APEC members, commitments in the TPP will be binding.

TPP is currently being negotiated among the United States and eight other partners: Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, and Vietnam. The United States announced its intention to undertake TPP negotiations in November 2009, and since 2010, nine rounds of negotiations have been held.

TPP addresses a range of issues not covered by past agreements in APEC. These include making regulatory systems of TPP countries more compatible and helping small and medium-sized enterprises (SMEs) to participate in the international marketplace. TPP countries are discussing elements for a labor chapter that will include commitments on labor rights protection and effective provisions on trade-related issues that would help to reinforce environmental protection.

The great potential that the TPP negotiations hold for the United States was noted by President Obama. “The TPP will boost our economies, lowering barriers to trade and investment, increasing exports, and creating more jobs for our people, which is my number-one priority. Along with our trade agreements with South Korea, Panama, and Colombia, the TPP will also help achieve my goal of doubling U.S. exports, which support millions of American jobs.”

Lynn Costa, Anita Ramasastry, and Kelsey Scheich of the ITA’s Market Access and Compliance unit assisted with this report.

h1

ITA’s Anti-Corruption Efforts at APEC

December 7, 2011

This post contains external links. Please review our external linking policy.

Lynn Costa is a senior trade development adviser in ITA’s Market Access and Compliance unit.

Corruption is a significant market access barrier for U.S. exporters. According to the World Bank, nearly $1 trillion is lost globally each year to corrupt activities. Small and medium-sized enterprises (SMEs) disproportionately bear the costs of corruption because they lack the bargaining power and influence to oppose requests for illegal payments and bribes. It has been estimated by the World Bank that 25 percent of the operating capital of a typical SME exporter is lost to corruption each year. This is a staggering amount that undermines innovation and inhibits company growth, employment, and export capability.

In an effort to put into place programs that will help eliminate corruption in the APEC economies, the Market Access and Compliance unit of the International Trade Administration (ITA) this year launched business ethics projects that focused on three sectors of special interest to SME exporters: medical devices, biopharmaceuticals, and construction. The result was a set of industry-specific ethics principles for business codes of ethics that were presented to the APEC ministers in Honolulu and subsequently endorsed by them. The next step will be the implementation of these business ethics principles over the next several years. This will be done thanks to a funding commitment made by APEC in response to ITA’s efforts in this area.

To read the full text, of the APEC ministers’ statement on open governance and ethical business practices, visit www.apec.org.

Follow

Get every new post delivered to your Inbox.

Join 397 other followers