Recently in Nov 2010 Category

U.S. Chamber's International Policy Update (November 12, 2010)

International Policy Update

In this Newsletter...

Deadline Passes on Korea-U.S. FTA, Negotiations Continue
Administration Advances Export Control Reforms
Chamber Urges Congress to Extend Trade Preferences
Business Groups Weigh in with USTR on MTB
The Week in Trade

U.S. Chamber Urges Swift Action to Complete Pending Korea-U.S. Free Trade Agreement (November 11)

In Seoul, Donohue Calls for Action on Pending Korea-U.S. Free Trade Agreement (November 8)

ChamberPost Blog: The Week in Trade

A KORUS Outcome "Sooner than people think"
by Tami Overby

Weeks, Not Months
by Tami Overby

Favorable Trade Winds Are Blowing
by Pat Cleary

Chamber's India Council Hosts President Obama in Mumbai
by John Murphy

On November 5, the Chamber and eleven other business associations sent a letter  to U.S. Trade Representative Ron Kirk warning that USTR opposition to the inclusion of certain tariff-suspension bills in a second Miscellaneous Tariff Bill (MTB) could jeopardize passage in the near term of the MTB. USTR has objected to inclusion of roughly 40 duty suspensions for textile and footwear products, arguing that their inclusion could undermine trade negotiations or U.S. trade preference programs. The letter states: "We all share USTR's goals of negotiating strong, market-opening trade agreements and administering fully the U.S. trade preference programs, but we simply do not see any basis through which the MTB process could seriously undermine those objectives." Separately, House Ways and Means Trade Subcommittee Ranking Member Kevin Brady (R-TX) has signaled publicly that he supports a second MTB advancing in the upcoming lame duck session of Congress.  Several House Republicans opposed the first MTB last summer citing House earmark rules.  

On November 11, the Chamber sent Congress a letter urging lawmakers to support legislation extending the Generalized System of Preferences (GSP) and the Andean Trade Preference Act (ATPA) for Colombia and Peru, both of which will expire on December 31. The letter questioned Ecuador's eligibility for participation in the Andean preferences given the statute's criteria relating to the rule of law.

For more than three decades, GSP has provided duty-free treatment to selected goods imported from more than 130 developing countries. Approximately three-quarters of U.S. imports using GSP are raw materials, parts and components, or machinery and equipment used by U.S. companies to manufacture goods in the United States for domestic consumption or for export. A Chamber study found that moving GSP imports from the docks to the retail shelves supports tens of thousands of U.S. jobs.

Similarly, ATPA has a proven record generating trade, growth, and jobs. Created with the goal of fostering legitimate development alternatives to narco-trafficking in the Andean countries, ATPA has boosted trade and today sustains hundreds of thousands of jobs in Colombia and Peru. The letter stated: "If Congress elects to extend Ecuador's benefits under ATPA, the Chamber urges that at a minimum Congress include in the legislation a similar requirement for an evaluation specific to Ecuador on at least an annual basis."

Although the mid-term elections are widely viewed as having diminished the likelihood that export control modernization legislation will be brought to the floor in the next year, Obama Administration efforts to reform the system through administrative actions are ongoing, with two significant developments this week. First, President Obama announced a relaxation of export controls for India, removing India's defense and space organizations from the U.S. "entities list," which restricted their business with the United States. As Deputy National Security Advisor for International Economic Affairs Michael Froman told reporters in Mumbai, "removing these entities from the list will allow for greater trade and cooperation in civilian space and defense, and enable our governments to focus on other outstanding barriers."

Second, President Obama issued an executive order on November 9 establishing an export enforcement coordination center.  The center will be funded, directed by and housed in the Department of Homeland Security, with deputy directors from the Departments of Commerce and Justice.  The export enforcement coordination center will facilitate government-wide communication and activity related to export controls enforcement, serving as the primary point of contact between State, Treasury, Defense, Justice, Commerce, Energy, Homeland Security, the directorate of National Intelligence and other relevant agencies.

In a highly anticipated meeting, President Obama and President Lee of South Korea were unable to bridge remaining differences on the pending Korea-U.S. (KORUS) Free Trade Agreement, telling reporters in Seoul on November 11 that negotiations will continue over the coming weeks. The two presidents missed a deadline set by President Obama to resolve outstanding issues regarding access to South Korea's market for U.S. autos and beef, and the two leaders said they had decided to give their trade ministers more time to work out technical issues. "We don't want months to pass before we get this done, we want this to be done in a matter of weeks," President Obama said. Korean Trade Minister Kim reportedly has agreed to come to Washington to continue talks with U.S. Trade Representative Ron Kirk.

"Time is of the essence. American jobs are on the line. Since South Korea will soon implement a similar arrangement with the EU, American workers stand to lose 340,000 jobs without this agreement," said U.S. Chamber President Tom Donohue. "The Chamber is ready to pull out all the stops to explain the benefits of this agreement to the American people and help move the pact through Congress. The sooner we get this deal done, the sooner it will start creating new American jobs."

While on the four-day trade mission to South Korea, Donohue also addressed the American Chamber of Commerce in Korea to highlight the benefits of implementing the Agreement. "If we're serious about creating jobs in the United States, we need to see action on this agreement," said Donohue. "The linchpin to reaching our goal of doubling exports in the next five years is going to be passing this deal."