November 2003 News

Commerce and USTR Announce New Industry Trade Advisory Committee Structure

The U.S. Department of Commerce and the United States Trade Representative (USTR) announced November 25th that the agencies have restructured their jointly-administered industry trade advisory committee system to ensure the committees reflect today's U.S. economy and vision for the future. The trade advisory system provides the private sector and civil society the opportunity to advise the Administration on trade issues and is an important part of the Administration's outreach efforts. "This new structure better reflects the 21st Century economy and will provide our negotiators with critical and timely advice during trade negotiations," said Commerce Secretary Don Evans. View Commerce Department press release (no longer available)

U.S. Official Urges Western Hemisphere to Liberalize Financial Sectors

The United States is urging its trading partners throughout the Western Hemisphere to liberalize their financial-services sectors "because recent economic research shows how important open, transparent financial sectors are" to achieving higher economic growth, says Randal Quarles, assistant secretary of the treasury for international affairs. Quarles noted that the U.S. Treasury Department is "highly engaged" in ongoing negotiations to establish a Free Trade Area of the Americas (FTAA), "particularly with respect to the negotiations on trade in financial services."

View USIS Washington File report

U.S. Official Urges Stronger Economic Partnership with EU

The United States and the European Union (EU) must resolve current trade conflicts and move forward to create a "more ambitious, more comprehensive, and ultimately more prosperous" transatlantic economic partnership, a U.S. trade official says. Speaking November 24 in Brussels, Under Secretary of Commerce Grant Aldonas said that a new dynamic in trade relations is the "surest" way of guaranteeing the prosperity on both sides of the Atlantic.

View USIS Washington File report

Hemispheric Trade Ministers Offer Guidance for Final Phase of FTAA Talks

Trade ministers representing the 34 democratic nations of the Western Hemisphere released a declaration on November 20 that outlines their vision for a comprehensive and balanced Free Trade Area of the Americas (FTAA) and provides instructions for the final phase of the hemispheric trade negotiations. The 39-point declaration was issued at the conclusion of the eighth FTAA trade ministerial meeting in Miami. According to regional officials, it reflects the trade ministers' aspirations for an FTAA agreement that will create the world's largest free-trade zone --- a zone featuring a combined gross domestic product of nearly $13 trillion and 800 million consumers stretching from Alaska to Tierra del Fuego, at the tip of South America. U.S. Trade Representative Robert Zoellick said the conclusion of the ministerial meeting and the release of the declaration ushers in a new stage in the FTAA process.

View USIS Washington File report

U.S. and Uruguay Will Begin Bilateral Investment Treaty Negotiations

Following the successful conclusion of the Free Trade Area of the Americas (FTAA) Ministerial in Miami, on November 20 U.S. Trade Representative Zoellick and Uruguayan Foreign Minister Opertti announced that their two countries would begin negotiation of a Bilateral Investment Treaty (BIT) early next year. The two countries will also explore additional possibilities for sectoral bilateral agreements that will lead to a further deepening of the bilateral trade relationship through increased market access. A BIT will send a strong signal to investors that Uruguay is moving past its recent financial crisis and is ready for business. View USTR press release (no longer available)

House Passes Bill to Make Permanent Trade Relations with Armenia, Enact Other Trade Changes

On November 20, the U.S. House of Representatives passed a bill that would make permanent normal trade relations, otherwise known as most-favored-nation status, with Armenia and make hundreds of small changes to U.S. trade laws. Armenia already has normal trade relations with the U.S., renewed annually; the House-passed bill would make that status permanent. The miscellaneous trade provisions are part of a larger legislative package including one-year extensions on a number of relatively minor tax provisions that are expiring plus a controversial measure aimed at helping ailing U.S. airlines save money on pension costs. One provision would extend Generalized System of Preferences (GSP) tariff benefits to certain hand-knotted and hand-woven carpets, a measure that could help Pakistan, Turkey, Nepal, Egypt and Morocco.

View USIS Washington File report

U.S. and Dominican Republic Will Begin Free Trade Talks

U.S. Trade Representative Robert Zoellick met on November 18 with Sonia Guzman, Secretary of Industry and Commerce of the Dominican Republic, to pursue negotiations to integrate the Dominican Republic into the U.S.-Central American Free Trade Agreement (CAFTA), according to a press release issued by the Office of the USTR. U.S. and Dominican officials "are planning to hold the first formal negotiating round in the Dominican Republic in January, beginning with a public launch," the USTR press release said. Added Zoellick: "The Dominican Republic already is a big market for the United States, and we're pleased to work together to reduce barriers bilaterally, as well as in the ongoing Free Trade Area of the Americas negotiation." View USIS Washington File report (includes text of USTR press release)

U.S. Officials Outline Commitment to Hemispheric Cooperation Program

U.S. Trade Representative Robert Zoellick said that the U.S. is committed to working with the hemisphere's smaller and less developed nations to ensure that they fully benefit from free trade, and will work with other nations and public- and private-sector organizations through the Hemispheric Cooperation Program (HCP) to this end. Zoellick said that, as the largest economy in the hemisphere, the U.S. is committed to supporting the efforts of smaller and less developed regional economies to get the full benefits of trade, overcome poverty and advance their development. The HCP, he said, will allow the U.S. to work with other donor nations, non-governmental organizations, international financial institutions and the private sector to find innovative ways to combine their efforts to ensure that trade liberalization works for developing nations.

View USIS Washington File report

Trade Official Outlines U.S. Hopes for FTAA Ministerial

During a background briefing for reporters, a U.S. trade official said on November 19 that the U.S. favors a comprehensive, ambitious Free Trade of the Americas (FTAA), covering all the areas of trade, with a common set of rules and obligations for all. The U.S. trade official said the U.S. continues to favor a comprehensive agreement that is not just a tariff reduction exercise, but covers all areas of trade including services, investment, intellectual property rights protection, government procurement, agriculture and competition policy. The official added that the U.S. also aspires to an FTAA that establishes a common set of rules and obligations for all parties, with each country playing by the same set of rules, but taking into account the different sizes and levels of development of the region's economies. As the different areas of trade have already been established, the trade official said, the challenge confronting ministers when they convene in Miami is how ambitious the FTAA will be in each of these areas.

View USIS Washington File report

Commerce Deputy Under Secretary Hauser Touts Benefits of FTAA, CAFTA

Commerce Deputy Under Secretary for International Trade Timothy Hauser told attendees at the Association of American Chambers of Commerce in Latin America conference in San Jose, Costa Rica that the Bush Administration remains committed to promoting free trade globally, regionally in the Western Hemisphere, and through bilateral trade pacts. Hauser said free trade promotes economic growth, encourages competition and innovation, and provides consumers with wider choices. Hauser said the proposed Free Trade Area of the Americas (FTAA) is the best route to forging stronger strategic and economic ties between the U.S. and the rest of the Western Hemisphere. He added that another proposed accord, the U.S.-Central American Free Trade Agreement (CAFTA), is about more than just increasing trade and economic efficiency. CAFTA, he said, is also about addressing poverty and promoting development in the region.

View USIS Washington File report

Commerce Assistant Secretary Lash Gives China Poor Grades on Trade

View the texts of Reuters and the National Journal's Technology Daily articles quoting Commerce Assistant Secretary for Market Access and Compliance William Lash III as stating that China has achieved a poor record in living up to its promises to abide by fair trade rules. Lash said he would give China a "gentleman's C to a D+" grade on its performance over the past year in enforcing its WTO commitments. But on enforcing intellectual property rights rules that protect foreign products such as music recordings, pharmaceuticals and airplane and automotive parts, Lash said China gets "a failing grade; maybe an F-."

Zoellick Meets With Central American Trade Ministers to Advance CAFTA Talks

U.S. Trade Representative Robert Zoellick met with five Central American trade ministers November 18 "to advance the final round of negotiations for the U.S.-Central American Free Trade Agreement (CAFTA) in December in Washington, D.C.," according to a USTR press release. Zoellick described CAFTA as "an ambitious and cutting-edge agreement that keeps pace with the modern globalized economy" and that "adds momentum for hemispheric free trade." Zoellick and the Central American trade ministers, from Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua, discussed outstanding issues that negotiators must resolve in order to conclude negotiations in December, as planned. View USIS Washington File report

U.S. Announces Intent to Initiate FTA Talks with Andean Nations, Panama

On November 18, U.S. Trade Representative Robert Zoellick announced that the U.S. intends to negotiate a free trade agreement (FTA) with the Andean nations of Colombia, Peru, Ecuador and Bolivia, and a separate FTA with Panama. Zoellick formally notified the U.S. Congress November 18 that the Bush administration plans to begin both the negotiations in the second quarter of 2004. In the case of the Andean pact, the talks would take place initially with Colombia and Peru, and later with Bolivia and Ecuador -- whose governments are presently completing their preparations for the future inclusion of their countries. Zoellick dismissed dismissed the notion that the U.S.-Andean FTA would undercut the FTAA negotiations. He said the different tracks the U.S. is pursuing in promoting hemispheric trade and integration -- such as the U.S.-Andean FTA, the U.S.-Central American Free Trade Agreement negotiations, and trade talks with the Dominican Republic and Panama -- build momentum, cementing support for the FTAA and free trade overall. On an FTA with Panama, Zoellick said the plans are "a vote of confidence" in that country which would complement the Central American Free Trade Agreement the U.S. expects to conclude soon with Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua.

View USIS Washington File report

Commerce Secretary Evans Announces Result of China Textile Safeguard Decision

On November 18, Secretary of Commerce Don Evans announced that the U.S. will establish new quotas on imports of Chinese clothing to halt a surge of shipments. Secretary Evans stated, “This decision demonstrates the Bush Administration’s commitment to our trade rules and America’s workers. I believe this will advance our future dealings with China, for no market operates fairly without open dialogue." He added, “The availability of this safeguard mechanism is an important tool for facilitating China's transition into the WTO. We look forward to beginning our consultations with the PRC, with the goal of achieving a mutually beneficial result on this issue.” View Commerce Department press release (no longer available)

Western Hemisphere Trade Officials Discuss Draft FTAA Declaration

Prior to the November 20-21 meeting of Free Trade Area of the Americas (FTAA) in Miami, senior hemispheric trade officials from the 34 nations participating in the FTAA talks convened in Miami to participate in the 18th FTAA Trade Negotiating Committee (TNC) meetings November 15-18. TNC participants, working from a proposal issued by FTAA co-chairs Brazil and the U.S., are crafting a draft FTAA declaration for the region's trade ministers to consider adopting later this week at the ministerial. The TNC discussions thus far have been "productive and workmanlike," according to Ross Wilson, chief FTAA negotiator at USTR, who told reporters November 17 that the TNC talks have touched upon many subjects, including a consideration of the different sizes and levels of development of the region's economies. The importance of fostering transparency in the FTAA process was also addressed, Wilson said.

View USIS Washington File report

USTR Web Page for Miami FTAA Discussions

View USTR’s web page (no longer available) for the Free Trade Area of the Americas Eighth Ministerial Meeting and 16th Trade Negotiations Committee, which will be held November 16-21 in Miami, Florida. View USTR Zoellick’s Wall Street Journal article on FTAA discussions (no longer available)

Morocco Joins WTO Information Technology Agreement

The WTO’s Committee of Participants on the Expansion of Trade in Information Technology Products approved the participation of Morocco, which became the 61st member of the WTO's Information Technology Agreement (ITA). Morocco's Ambassador Omar Hilale, who presented his country's membership request to the Committee on November 5, 2003, said that Morocco's imports of IT products have been rising in recent years due to tariff cuts, adding that Rabat intends to eliminate most of these tariffs by 1 April 2004 under the ITA. Ambasador Hilale said that joining the ITA would make prices of IT inputs in Morocco more competitive and send the right signal to foreign investors.

View text of WTO news item

Commerce Secretary Evans Hails Boeing, G.E. Aircraft Engines Contract Signings with China

On November 12, Commerce Secretary Don Evans hailed Boeing’s and G.E. Aircraft Engines’ signings of contracts with China, commenting “Without a doubt, these sales are strong proof that free trade benefits both America and China.” The Secretary stated, “These contracts reflect [President Bush’s] policy of engaging other nations openly and candidly on trade, especially China,” and added, “These latest commercial sales are a sign that China wants to build a better trade relationship with the United States.” Secretary Evans said, “The march to free and fair trade is a long march. And we must not rest until it is complete. These sales today are small steps in that direction. But clearly they are steps in the right direction.” View text of Secretary Evans’ remarks (no longer available)

President Opposes Repeal of China NTR, Evans Says

Secretary of Commerce Donald Evans told the Minnesota and St. Paul Chambers of Commerce November 6 that the Bush Administration opposes recent congressional proposals to repeal China's normal trade relations (NTR) status and to impose a 27.5 percent tariff on Chinese exports to the U.S. While stating that the Administration "…opposes these proposals because free trade is the best policy for American workers in the long run," he added that the proposed tariffs "should serve as a warning to the Chinese government that progress [on World Trade Organization commitments], not promises, is required." According to Evans, the American Chamber of Commerce in China chose 14 benchmarks to test China's WTO commitment performance. As of July, China had "made good" on two, had made some progress on seven, and had "significant problems" with the other five. View text of Secretary Evans’ remarks (no longer available)

USTR Zoellick Hosts Latino Coalition for Free Trade

One week prior to meeting with hemispheric trade officials in Miami, U.S. Trade Representative Robert Zoellick hosted over 100 prominent Latino business and community leaders from across the U.S. at a November 12 White House event to launch the Latino Coalition for Free Trade, according to a USTR press release. Joining Zoellick were representatives from throughout Latin America, including many from the five Central American nations currently negotiating the U.S.-Central American Free Trade Agreement (CAFTA). "As President Bush has stated, the future of our hemisphere depends on the strength of our commitment to free markets, economic opportunity, and democracy. Latinos in the United States contribute daily to the prosperity of this country, and understand the promise that these values hold for the rest of the hemisphere," said Zoellick. View USIS Washington File report (includes text of USTR press release)

U.S. Has No Plans to Lift Cuba Embargo, Says Commerce Official

According to a Tuscaloosa News article, Commerce Assistant Secretary for Market Access and Compliance William Lash III stated on November 6 that, despite a loosening of the trade embargo the U.S. has maintained against Cuba since 1961, the embargo will not be lifted until Cuban leader Fidel Castro allows free elections in the island country. Lash said that the U.S. currently allows cash sales of agricultural and medical supplies to Cuba because they are deemed items that will benefit Cuban citizens. Any further lifting of the embargo to allow other goods would only serve to enrich Castro, he said. Lash addressed state and local business leaders on international trade at a closed-door roundtable forum at the University of Alabama. He said afterward that some business leaders at the roundtable were concerned about the implications of international free trade on their own businesses, including new trading partners, illegal competition and standardization of trade regulations. Lash said the Bush administration has been pushing to open up trade opportunities with South Africa, Bahrain and Central America, among other areas, to ensure that their tariffs remain low and their economies open to exports from the U.S.

View text of Tuscaloosa News article

USTR Comments on WTO Appellate Body Report in Steel Safeguard Case

In a November 10 press release, USTR spokesperson Richard Mills commented on the WTO Appellate Body report in the steel safeguard case. Mills stated, "The temporary steel safeguard measures the President imposed over a year and a half ago were intended to provide the domestic industry with the breathing space needed to restructure and consolidate, thereby becoming stronger and more competitive.” He added, "While we are pleased to see the Appellate Body upheld the Panel's rejection of some of the arguments raised by the complainants, we disagree with the overall Appellate Body findings. We will be reviewing the WTO report carefully." View USTR press release (no longer available)

WTO Establishes Dispute Panel in U.S. Challenge to Mexican Antidumping Order on Rice

On November 7, USTR announced that the WTO has established a dispute settlement panel to review the U.S. challenge to Mexico’s antidumping order on U.S. long-grain white rice. The panel, which will also review certain provisions of Mexico’s Foreign Trade Act and its Federal Code of Civil Procedure, was established in response to a request by the U.S. View text of USTR press release (no longer available)

Philippines Increases Tariffs

In October, Philippines President Gloria Macapagal Arroyo signed an executive order lifting the rates on 464 tariff lines, to go into effect on November 16, 2003. In addition, a review committee recommended maintaining the existing tariff rate on an additional 828 product lines. The tariff increases affect nearly 10 percent of the country’s 5,700 total tariff lines. Products affected include industrial goods that have domestic producers, such as footwear, chemical fertilizers and cements. Executive Order 241 raises rates on these products from the current 3 to 7 percent to between 5 percent and 15 percent. According to language in the order, “Developments in the domestic and global economic environments warrant the modification in the rates of duty on certain products to provide temporary relief to local manufacturers and enable them to further enhance their competitiveness.” These new rates are expected to remain in effect until 2007. The raising of the rates was expected, and appears to be in line with other efforts by the Philippine government to provide protection to domestic producers. Despite the tariff increases, the Philippines still remains in compliance with its WTO obligations, since these new tariffs fall below the bound tariff rates.

Secretary Evans Urges Fair Trade for U.S. Manufacturers in Minnesota Visit

Commerce Secretary Don Evans will visit Minneapolis and St. Paul, Minnesota on Thursday, November 6, 2003, where he will discuss his recent trip to China and the negative impact China’s unfair trading practices is having on U.S. manufacturers, and highlight President Bush’s manufacturing initiative to help create new jobs. Evans and Governor Tim Pawlenty will tour the Twin Cities Die Casting Company, a die casting manufacturer in Minneapolis, which will be followed by a roundtable discussion with company employees. Following the tour and roundtable discussion, Evans will deliver an address to area business leaders at the Chamber of Commerce luncheon in St. Paul. View transcript of Secretary Evans' remarks (no longer available)

China Must Play by Same Trade Rules as U.S., Evans Says

View the text of Secretary of Commerce Don Evans’ Wall Street Journal column, in which the Secretary stated, “If you believe in free trade you must also insist on a level playing field and you must take issue with trading partners that tolerate or facilitate an unequal relationship.” During his recent trip to China, the Secretary told his hosts, “If you value access to American markets, the Chinese government must accelerate the pace of reform by dropping trade barriers, ending state-subsidies and speeding up its transition to an open, fully market-based economy.”

Developing Countries Urged to Integrate Into Global Trade System

Under Secretary of State for Business, Economic and Agricultural Affairs Alan Larson told a UN meeting on financing for development that developing countries which integrate most rapidly into the global trading system grow substantially faster than countries that remain closed to international market opportunities. He said that the U.S. is committed to helping countries integrate by providing effective, targeted development assistance. Larson stated that, although the U.S. is the largest aid, trade and investment partner with developing countries, these countries have the "primary responsibility for their own development." He said, for instance, that the full poverty reduction benefits of trade can happen only if countries at all income levels contribute to reducing trade barriers. Larson stated that foreign investment will grow fastest in developing economies that protect property rights and the rights of individuals and that invest in a skilled and healthy work force.

View USIS Washington File report

U.S. Restores Normal Trade Relations Status for Serbia and Montenegro

Secretary of State Powell has determined and certified that Serbia and Montenegro has met the criteria set forth in Public Law 102-420 for restoration of Normal Trade Relations (NTR) status. The statute provides for a 30-day waiting period following certification before restoration of Normal Trade Relations takes effect. This decision has been conveyed to Congress, and a notice will be published in the Federal Register. Restoring Normal Trade Relations status underscores United States support for these reforms and will help encourage economic growth, a key component to maintaining stability in the region. According to a Tanjug report, Commerce Assistant Secretary for Market Access and Compliance William Lash III met with Serbia and Montenegro (SCG) Minister of International Economic Relations Branko Lukovac and Minister of Internal Economic Relations in Belgrade on October 31. They discussed commercial issues and the overall SCG-US economic relations, the SCG Information Directorate said. Talks covered issues of promoting the scale and quality of SCG-US trade in view of the imminent adoption of decisions to grant the state union normal trade relations status which will replace the former most favored nation status, said a statement received by Tanjug.

View State Department press release

View Tanjug article

Commerce Department Encourages Removal of Standards Related Trade Barriers

Commerce Deputy Secretary Sam Bodman awarded $399,853 to the Advanced Television Systems Committee (ATSC) Forum to help fund its Hemispheric Digital Television (DTV) Initiative. The awarded funds are expected to help generate nearly $7.8 billion in exports to Latin America and create close to 156,000 jobs for the American people by 2014. “The Department of Commerce is pleased to partner with the ATSC Forum on this project,” said Bodman. “This partnership reflects the Bush Administration’s commitment to opening new markets, creating and sustaining high-quality jobs, and encouraging the right conditions for American businesses to innovate, compete and prosper.” The money will help give ATSC Forum the maximum leverage in encouraging policy makers and industry leaders in Latin America on the adoption of its standards. It will also help increase exports from small- and medium-sized businesses in the U.S. television industry, including broadcasters, software producers, and manufacturers of transmission equipment, receivers, semiconductors and other components. View text of Commerce Department press release (no longer available)

Request for Comments on National Trade Estimate Report

View the text of a Federal Register notice requesting interested parties to assist the Trade Policy Staff Committee (TPSC) in identifying significant barriers to U.S. exports of goods, services and overseas direct investment for inclusion in the annual National Trade Estimate (NTE) report. Public comments are due not later than Friday, December 12; no submissions will be accepted after December 12. In order to ensure the most timely processing of submissions, the Department of Commerce will receive comments in response to this Notice. ADDRESSES: Paper submissions: NTE Comments, Office of Trade and Economic Analysis, Room H-2815, U.S. Department of Commerce, Washington, DC, 20230. Submissions by electronic mail: http://www.ntecomments@ita.doc.gov.

Democratic Republic of the Congo Eligible for AGOA Benefits

In a Federal Register notice, USTR advised that it has designated the Democratic Republic of the Congo as a beneficiary sub-Saharan African country eligible to receive the trade benefits provided for in the African Growth and Opportunity Act (AGOA) for articles other than textiles and apparel.

Secretary Powell Discusses CAFTA, FTAA, in CNN Espanol Interview

During an October 30 interview with CNN Espanol, Secretary of State Colin Powell discussed Western Hemisphere relations and developments. Secretary Powell said U.S. relations with Central America are excellent and cited economic development (the U.S.-Central American Free Trade Agreement, in particular), ending corruption, and strengthening the rule of law as important issues that the U.S. and Central American nations must work on collectively. Discussing efforts to create a Free Trade Area of the Americas (FTAA), Powell said that despite the recent collapse of global trade talks in Cancun and differences regarding agricultural subsidies, the U.S. will continue to push for free trade. "We'd like to see free trade from the top of our hemisphere to the bottom of our hemisphere," Powell said. "We believe that's in the best interest of all Americans, no matter what country of the Americas you happen to be living in." View text of Washington File report (includes transcript of Secretary Powell’s interview)