July 2008 News

U.S. Trade Representative Schwab’s Statement on WTO Negotiations

View the text of U.S. Trade Representative Susan C. Schwab’s statement regarding the results of the WTO Trade Negotiations Committee meeting in Geneva. While noting the progress made during the talks, Schwab stated that the participants “will not be able to reach a breakthrough at this time.” Ambassador Schwab said that talks “deadlocked on the scope of a safeguard mechanism to remedy surges in imported agricultural products.” The United States “could not agree to a result that would raise more barriers to world food trade” in the midst of a global food price crisis. She stated that the United States “will continue to stand by our current offers… (which) are still contingent on others coming forward with ambitious offers that will create new market access. So far, that ambition is not evident.”

Gutierrez Calls on Congress to Pass FTAs at “America Wins with Trade” Bus Stop

On July 24, Secretary of Commerce Carlos M. Gutierrez welcomed the Consumer Electronics Association’s “America Wins with Trade” bus to Washington. He highlighted export growth and the need for Congress to pass FTAs with Colombia, Panama and South Korea. “In 2007, our country exported a record of $1.6 trillion dollars,” Gutierrez said. “That’s 12 percent of our economy. Free trade agreements are good for jobs, are good for exports, are good for the economy, and there’s no excuse to not pass these agreements now.”

View text of Secretary’s remarks

View video of Secretary’s remarks

U.S. Manufacturing Exports Swing from Deficit to Surplus with FTA Countries

On July 23, Secretary of Commerce Carlos M. Gutierrez announced new data showing that the United States is running a trade surplus in manufactured exports with our 14 free trade agreement (FTA) partners. In the first five months of 2008, the trade balance in manufactured goods rose to a $2.7 billion surplus with our FTA partners from a $12.3 billion deficit during the same period last year. “These figures show that our FTAs are succeeding and that Americans benefit from open markets,” Gutierrez said. This improvement in the trade balance is due to the increasing competitiveness of U.S. manufactured goods. Since 2002, FTAs have helped U.S. manufactured exports grow steadily and at a faster rate than imports — 63 percent compared to only 42 percent, respectively, year-to-date through May 2008 (compared to same period of 2002).

View FTA Manufacturing Trade Surplus Fact Sheet

Schwab Announces Implementation of Two CAFTA-DR Textile Provisions

U.S. Trade Representative Susan C. Schwab announced on July 22 that the United States plans to implement two textile provisions in the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR) with respect to materials made in Mexico . The textile cumulation provision and the pocketing amendment, when implemented on August 15, will change the CAFTA-DR Rules of Origin to promote regional production. “The implementation of the CAFTA-DR textile cumulation provisions and the pocketing amendment marks another important step forward in the integration of apparel manufacturing in the region,” said Schwab. “The provisions will strengthen our already strong economic relationship with our trading partners in the region, and will create new opportunities for the use of U.S. fabric and yarn in apparel production in the region.”

View text of USTR press release

United States Offers Further Cuts in Agricultural Subsidies in Trade Talks

View the text of U.S. Trade Representative Susan Schwab’s July 22 remarks at the WTO Trade Negotiations Committee meeting in Geneva, during which she stated that the USG is ready to cut allowable agricultural subsidies to $15 billion in order “… to move these negotiations forward … and in exchange for an ambitious market access outcome in agriculture and NAMA [Non-agricultural Market Access].” Noting that this offer is a “strong sign of our commitment to achieving a successful outcome,” Schwab added “…for this Round to succeed as a development round, all of the main developed and developing country players will be faced with hard decisions, and all of us – developed and emerging markets – must be prepared to make tough decisions.”

USTR Schwab’s Statement to WTO Trade Negotiations Committee Meeting

View the text of U.S. Trade Representative Susan C. Schwab’s statement to the WTO Trade Negotiations Committee on July 21. Ambassador Schwab reminded the participants that progress in the Doha trade negotiations will not be achieved by falling back on tired rhetoric aimed only at perpetuating old divisions or creating new ones. At the same time, she is aware “that most, if not all of us share the objective that this week produce an outcome that will place the Doha negotiations on a path that results in a contribution to global economic development, growth, and poverty alleviation.”

Listen to Schwab’s remarks/view transcript of remarks

Ambassador Schwab Signs Historic Trade Agreement with the Countries of the Southern African Customs Union

On July 16, U.S. Trade Representative Susan C. Schwab signed the very first Trade, Investment and Development Cooperation Agreement (TIDCA) with the Southern African Customs Union (SACU) in an official ceremony with SACU Trade Ministers from Botswana, Lesotho, Namibia, Swaziland and South Africa. Schwab stated, “This important agreement will provide a framework for the United States and SACU to work together to create the building blocks that strengthen and deepen our trade ties and that could lead to a free trade agreement in the long term.” The TIDCA will be a formal mechanism for the United States and SACU to conclude a range of interim trade-related agreements, cooperative work and other trade-enhancing initiatives. It also will allow the United States and SACU to develop work plans on key issues such as sanitary and phytosanitary barriers, technical barriers to trade, trade facilitation and investment promotion that should lead to increased U.S.-SACU trade and investment in the near future.

View USTR press release

Ambassador Schwab Signs Trade and Investment Agreement with East African Community

On July 16, U.S. Trade Representative Susan C. Schwab signed a Trade and Investment Framework Agreement (TIFA) aimed at deepening U.S. economic engagement with the East African Community (EAC). EAC Director-General for Customs and Trade Peter Kiguta signed the agreement on behalf of the EAC, witnessed by trade ministers and other senior officials from EAC member states Burundi, Kenya, Rwanda, Tanzania and Uganda. Schwab commented, “We see the TIFA as a major step toward deepening the U.S.-EAC trade and investment relationship, expanding and diversifying bilateral trade, and improving the climate for business between U.S. and East African firms.” The U.S.-EAC TIFA will establish regular, high-level talks on the full spectrum of U.S.-EAC trade and investment topics, including the African Growth and Opportunity Act (AGOA), the WTO’s Doha Round, trade facilitation issues, and trade capacity building assistance.

View USTR press release

WTO Panel Finds Against China’s Taxation of U.S. Auto Parts

U.S. Trade Representative Susan C. Schwab announced on July 18 that the first WTO dispute settlement panel to address a dispute against China has issued a report finding that China’s treatment of U.S. and other imported auto parts is inconsistent with China’s WTO obligations. Schwab, who said that she is “extremely pleased with the issuance of a very strong report by the WTO panel,” added “The auto industry is an important part of the U.S. economy, and we will continue our efforts to ensure that U.S. manufacturers and workers in this and other industries enjoy the benefits of open markets and a level playing field.” The United States was joined by the European Union and Canada, which also pursued dispute settlement proceedings with China on the same matter.

Secretary Gutierrez Lauds Record Exports, Calling on Congress to Approve Trade Agreements for America

On July 11, Commerce Secretary Carlos M. Gutierrez issued a statement on the release of the May 2008 U.S. International Trade in Goods and Services report, which shows that U.S. exports increased 18.2 percent to $768 billion year-to-date (through May) over the same period in 2007. Imports also increased 12.0 percent to $1,063 billion and the trade deficit narrowed 1.3 percent during the same time period. Commenting that the data “highlights the strength of American exporters in the global marketplace,” the Secretary stated that “Free trade agreements... benefit close allies who are pursuing policies to increase their own openness to trade.” Declaring, “Now is not the time for America to give into calls for increasing economic isolationism,” Secretary Gutierrez urged the Congress to “work with us and pass the pending FTAs with Colombia, Korea and Panama, so we can have fair, two-way trade with our allies and friends.”

View Commerce press release

Gutierrez Calls Colombia FTA Economic and National Security Issue

Citing the trade benefits to U.S. exporters, the courageous rescue of the 15 hostages held by the FARC as the result of efforts by the Colombian government, and the dynamic turnaround of the Latin American nation, Commerce Secretary Carlos M. Gutierrez urged Congressional approval of the U.S.-Colombia Free Trade Agreement in remarks to the League of United Latin American Citizens (LULAC) on July 9. The Secretary noted Colombian President Uribe’s statement that the single biggest thing the United States can do to help Colombia continue to make progress is to approve the FTA.

View text of Secretary Gutierrez’s remarks

Gutierrez Hails Intellectual Property as the “Lifeblood of our Economy” at New IP Coordination Center

On July 10, Secretary of Commerce Carlos M. Gutierrez joined Secretary of Homeland Security Michael Chertoff at the grand opening of the National Intellectual Property Rights Coordination Center. The new Center is an effort to enhance coordination among federal agencies tasked with protecting intellectual property both domestically and internationally. Gutierrez said that intellectual property enforcement would be increasingly “important as we rely more on high technology, on innovation, on patents, on trademarks. This is really the lifeblood of our economy.”

View text of Secretary’s remarks

Under Secretary Padilla Stresses Openness as Key Principle for Successful International Trade

Under Secretary Christopher Padilla addressed the importance of an open economy to America’s competitiveness in the global economy as well as the pending free trade agreements with Colombia, Korea, and Panama at a Hudson Institute conference in Washington on July 9. "America’s openness gives us a leg up in the global economy—we are stronger as a nation because we welcome the world’s products, ideas, investment, and people," said Padilla. He noted that the United States’ “leadership for openness also means that we should work for a successful conclusion to the Doha Round of negotiations in the World Trade Organization.” Padilla stated that the United States “must continue our policy of positive engagement with China,” calling it “our most important economic relationship of the 21st Century.” He said that the U.S. challenge is to help China maintain its openness, which, he added, is in the United States’ national interest.

View text of Padilla’s remarks

Under Secretary Padilla Addresses Asian Economic Integration

Under Secretary of Commerce for International Trade Christopher Padilla discussed Asian economic integration in a July 7 speech at the American Enterprise Institute’s forum, “Asian Economies in Transition: Will the United States Be Left Behind?” In his remarks, Mr. Padilla stated, “America is more dependent than ever on trade with Asia; the region accounts for about one-third of U.S. merchandise trade, more than any other single region of the world.” Noting the growth of intra-Asian trade, Padilla observed that the United States is losing market share in Asia: the United States is the source of approximately 10 percent of Asia’s imports, down from 20 percent two decades ago.  Padilla called on the United States to be the driver in pushing forward “an inclusive pan-Pacific economic architecture,” bringing “its traditional advocacy of open markets to a region that is still taking only partial steps toward free trade and investment.” Stating that the United States does not view Asian economic integration as threatening, Padilla observed, “if there is a danger associated with Asian economic integration it is that an isolationist America will exclude itself from regional mechanisms, failing to lead the way toward expanded trade both with – and within – Asia.”

USTR Schwab Calls on Japan to Reinvigorate Regulatory Reform
On July 5, U.S. Trade Representative Susan C. Schwab announced the results of this year’s work under the U.S.-Japan Regulatory Reform and Competition Policy Initiative.  She also urged Japan to devote greater attention to promoting new structural and regulatory reform measures. In the Initiative’s Report to the Leaders, the United States welcomed Japan’s latest initiatives to improve the environment for foreign direct investment.  If translated into concrete actions, recent policy pronouncements such as those made by Japan’s Council on Economic and Fiscal Policy could bring important new progress in the coming months, such as improvements to the rules relating to new mergers and acquisitions in Japan.  Separately, the report identifies a series of specific new steps that Japan is already taking, including liberalizing the sale of insurance products through banks, thereby enabling insurance providers to improve convenience and choice for consumers. The United States was strongly disappointed by Japan’s failure to implement a science-based approach consistent with international standards and requirements to fully resolve several agricultural issues, including improving its enforcement regime for maximum residue limits.  The same concern extends to Japan’s beef market.  View USTR press release View fact sheet on seventh report to leaders

United States and China Launch Investment Treaty Negotiations

The United States and China agreed to launch negotiations of a bilateral investment treaty (BIT) on June 18 during the fourth meeting of the United States-China Strategic Economic Dialogue. In negotiating the BIT, the United States would seek to secure for U.S. companies important legal protections, including the right to: non-discriminatory treatment; fair and equitable treatment, including the right to due process; and submit disputes to independent international arbitration. These protections would help level the playing field for U.S. companies. Chinese investors in the United States already enjoy these protections under U.S. law. In addition, many of the European and Asian competitors of U.S. companies also enjoy these protections in China under BITs that their governments have already signed with China.