President Obama’s Trade
Agenda
Dale Jones – ITRN 701 Global Trade Politics Seminar
Dr. Stewart Malawer
Presentation #2 / April 23, 2013
Key Articles and Links
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USTR – The Presidents 2013 Trade Policy Agenda http://www.ustr.gov/sites/default/files/Chapter%20I%20%20The%20President%27s%20Trade%20Policy%20Agenda.pdf
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Acting USTR Marantis address to Senate, March 19, 2013
http://iipdigital.usembassy.gov/st/english/texttrans/2013/03/20130319144447.html#axzz2PUmunywX
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Wall Street Journal “A New Economic Strategy” Feb 6, 2013 (posted on Dr. Malawer’s Web Site) (An
Alternative to the Administrations Agenda with some potentially strong arguments)
http://www.internationaltraderelations.com/Article.New%20U.S.%20Int%27l%20Eco,%20Strategy%20%28
Zoellick%29%20%28WSJ%202.6.13%29.pdf
•
The American, The American Enterprise Institute, “Not So Fast: Conflicting Deadlines for the TPP and USEU FTA”, Claude Barfield, March 8, 2013 (Some concerns about the potential timing and success of the
President’s agenda) http://american.com/archive/2013/march/not-so-fast-conflicting-deadlines-for-the-tppand-us-eu-fta
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World Politics Review, “Opportunity Knocks for Obama on Trade”, January 8, 2013 (An optimistic outlook
on the President’s trade agenda and the potential for it)
http://www.worldpoliticsreview.com/articles/12604/opportunity-knocks-for-obama-on-trade
President Obama’s International
Trade Agenda Focus
First Term
Second Term
“Expand Exports”
“Expand Trade Overall”
• National Export Initiative
• Enforcement of US
Protections
• Finalized pending Bush
Administration Agreements
• South Korea
• Colombia
• Panama
Expand Trade Overall through
focus on FTAs
• Trans Pacific Partnership
• US – EU Transatlantic
Trade and Investment
Partnership
• Trade Promotion Authority
WTO Focus –
• Trade Liberalization
• IT and International
Services Agreements
USTR report to Senate in
March 2013
Key Accomplishments
• Since2009, increased U.S. exports have
supported 1.3 million additional American
jobs.
• Last year, U.S. exports @ record high
• Since 2009, manufacturing exports up 47
percent; agricultural exports up 44 percent;
and services exports up 24 percent
Three Pending Free Trade
Agreements Finalized
October 12, 2011 WASHINGTON – “Congress
approved free trade agreements Wednesday with
South Korea, Colombia and Panama, ending a fouryear drought in the forming of new trade
partnerships and giving the White House and
Capitol Hill the opportunity to show they can work
together to stimulate the economy and put people
back to work.” CBS News
President’s 2013
Trade Policy Agenda
The President’s Trade Policy Agenda for 2013 describes how the Administration will continue to use every
available policy tool over the next year – and develop new tools as necessary – to pursue the most efficient
and productive pathways for trade liberalization in order to support greater economic growth and jobs. Moving
forward, the Administration will continue to work with willing trading partners as we constantly seek ambitious,
comprehensive, and high-standard trade and investment commitments that will enhance the ability of U.S.
workers and firms to compete here at home and on a level playing field around the world. We will continue to
enforce our trade agreements rigorously to bring home their economic benefits, preserve and support
additional U.S. jobs, and discourage trade-inhibiting actions that diminish economic growth. We will strengthen
trade relationships in every region, partner with developing countries to share the benefits of trade more
broadly, and continue to reflect and uphold American values in trade policy.
Our efforts in 2013 will build on many successful 2012 initiatives to enable continued progress toward
President Obama’s National Export Initiative goal to double U.S. exports in support of up to two million
additional U.S. jobs by the end of 2014. We will further intensify negotiations with Trans-Pacific Partnership
(TPP) countries to secure a next-generation, high-standard trade agreement in the world’s fastest growing
region. We will launch negotiations with the European Union toward a Transatlantic Trade and Investment
Partnership agreement to further strengthen the world’s largest trade relationship. At the WTO, we will
continue to advance promising pathways for 21st century trade liberalization and to seek to revitalize
Members’ work in Geneva, including on trade facilitation, expansion of the Information Technology Agreement,
and negotiations on a new International Services Agreement.
Key Components to the
President’s Second Term
Trade Agenda
• Trans-Pacific Partnership (TPP)
• US – EU Trade Agreement
(AKA The Transatlantic Trade and
Investment Partnership (TTIP)
• Trade Promotion Authority (Fast Track)
USTR to Senate, March 2013
Administration’s Trade
Agenda
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Consult with Congress on U.S negotiating objectives
Hold trade partners accountable
Intensify Trans-Pacific Partnership negotiations
Trans-Atlantic Trade and Investment Partnership with the
European Union
• Geneva Discussions at WTO - advance trade liberalization;
include trade facilitation and expansion of the Information
Technology Agreement and Trade Services provisions.
• Seek Trade Promotion Authority
Continue the Export
Initiative
• Exports continued to climb, hitting record highs in all major
sectors in 2012;
• services exports were up 24 percent over 2009;
• manufacturing exports were up 47 percent; and
• agricultural exports were up 44 percent.
• Consequently, overall U.S. exports of goods and services
have increased by more than 39 percent above the level of
exports in 2009, and this has supported more than 1 million
additional American jobs;
Challenges to the Objectives
• Replacement of the US Trade
Representative – Ron Kirk
• Congressional Interest in participating in
the determination of international trade
policy
• Objections and time required to gain Trade
Promotion Authority
• Complexity of TPP and EU Negotiations
The Battle for “Fast Track”
House of Representative Ways and Means Committee Chairman Dave Camp, a Michigan
Republican, urged President Barack Obama to "demonstrate his commitment to a vigorous
and productive trade policy" by opening talks with Congress on the "fast track" powers and
"nominating a qualified and committed U.S. trade representative.“
The current U.S. trade representative, Ron Kirk, plans to step down soon. That will leave the
position of chief U.S. trade negotiator vacant as the United States prepares to launch trade
talks with the European Union and as it seeks to finish talks on a Trans-Pacific Partnership
pact by the end of the year.
It is considered essential to assuring other countries that any deal they reach with the United
States will not be picked apart by U.S. lawmakers during the approval process.
Both Camp and Senate Finance Committee Chairman Max Baucus, a Democrat from
Montana, have announced plans to pursue TPA legislation. But many lawmakers believe a
strong push from Obama is needed because trade bills are unpopular with many Democrats.
Fast Track and the USTR
US Business Roundtable Today with Business
Roundtable President John Engler
And how might the administration win passage of TPA?
One, they could name the new USTR head, and that person, as part of the
confirmation hearing could then be testifying as to the important need to have that, and
saying that would be one of their priorities as the head of the USTR: "That the
president has said, 'Help me get this renewed.'
Indeed, Engler used his opening remarks to call on the President to nominate a U.S.
Trade Representative as soon as possible, get that person confirmed, and get working.
The WTO agenda?
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To realize the enormous potential of more open markets for trade in services to
support additional jobs and economic growth worldwide, the United States is joining
like-minded WTO Members this year in launching multi-party negotiations toward an
ambitious international services trade agreement (ISA).
Protectionism - Agriculture and the WTO – a case by case approach seems to be the
trend
The United States is currently the world's largest services trader. U.S. exports of
private services measured almost $600 billion in 2011, and sales through foreign
affiliates exceeded $1 trillion in 2010. Taken together, international sales of services
by U.S. companies are on the order of $1.7 trillion per year, which is equivalent to
approximately 11 percent of U.S. Gross Domestic Product (GDP).
ISA talks in Geneva include 20 trading partners and the United States has trade
agreements with 10 of these negotiating partners. The ISA offers a unique platform to
work on deeper services integration simultaneously with diverse partners such as
Japan, Chinese Taipei, Israel, Norway, Pakistan, andTurkey, and to help influence the
development of the global services architecture.
Participate in negotiations to expand the scope of the WTO Information Technology
Agreement (ITA) of 1997 that now covers over $4 trillion in annual global trade.
The Trans Pacific
Partnership
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More than 40 percent of global trade, and experts estimate that economies around
the Pacific Rim will continue to grow faster than the world average through 2016.
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TPP partners now include Australia, Brunei Darussalam, Canada, Chile, Malaysia,
Mexico, New Zealand, Peru, Singapore, and Vietnam
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The “ambitious, comprehensive and high-standard” Transatlantic Trade and
Investment Partnership (TTIP) TPP, APEC and the APEC’s ultimate goal of a Free
Trade Area of the Asia-Pacific (FTAAP)
APEC and the TPP
TPP market snapshot (including Australia)
GDP: US$20,734 billion (2011)
GDP per capita: US$31,491 (2011)
Population: 658.4 million (2011)
Trade with Australia: AU$135.303 billion (2011)
Transpacific Partnership
GDP Potential, 2010
The Economist “Opening up the
Pacific” November 12, 2011
Accessed and downloaded
March 26, 2013 from;
http://www.economist.com/blogs/
banyan/2011/11/free-tradeagreements
The EU Transatlantic Trade
and Investment Partnership
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Even though tariffs are already low, with an average of 3%, the sheer size of the transatlantic
economy and trade means that removing these barriers would have a positive impact on both jobs
and growth. However, the real benefits would come from removing NTBs
For the EU, the added value of increased economic cooperation and representation on the world
stage. A country like the UK would never be able to negotiate a deal with the US on the same terms
as the EU as a bloc can.
From a global perspective, a transatlantic partnership would be able to set standards for future world
trade- and it would be an incentive for (re)emerging economies or developing countries to step up
their game, improve their competitiveness and prosperity by opening up markets and working
towards meeting the new TTIP global standards.
Eliminating tariffs would already offer some gains but greater potential from eliminating “behind-theborder” obstacles ; as much as 80% of the total potential GDP gains come from cutting costs
imposed by bureaucracy and regulation, as well as from liberalizing trade in services and public
procurement.
The TTIP would boost exports in almost all sectors, but would be especially beneficial to certain
sectors in both the EU and the US. In the motor vehicles sector, EU imports are expected to go up by
42% and exports by 43%. EU exports of motor vehicles to the US would increase by 149%. Other EU
sectors that have a lot to gain from the TTIP by increased sales to the rest of the world would be the
metal products (+12%), processed foods (+9%), chemicals (+9%), other manufactured goods (+6%)
and other transport equipment (+6) sectors.[3]
The Dynamics & the US
Relationship with China
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In 2013, the United States will address trade objectives with China using all available
tools including dialogue, negotiation, and enforcement when appropriate. We will seek
to increase transparency and eliminate market access barriers across all sectors.
We will advance Bilateral Investment Treaty (BIT) negotiations with China to secure
improved market access, important investor protections, and increased certainty for
US investors.
work to obtain a comprehensive offer from China, commensurate with other Parties‘
coverage, to join the WTO Government Procurement Agreement to provide substantial
access for U.S. and international exporters to one of the world’s largest government
procurement markets.
Closely monitor implementation of China’s bilateral and WTO commitments to respect
and protect U.S. intellectual property, and will work with China to improve intellectual
property protection and enforcement, recognizing that strong rule of law is essential to
encourage and support continued innovation.
Continue to hold China accountable for its other WTO commitments through
appropriate enforcement efforts that aim to end discriminatory policies wherever they
are discovered in China.
A worker in the Port of Qingdao in March. China's Ambassador to the
WTO Yi Xiaozhun warned that the nation's exports situation this year
is not positive and trade frictions targeting China will continue in the
long term. Yu Fangping / For China Daily
The BRIC(S) Evolving
Influence
• To engage or ignore?
• Russian Relationships and trade
status
• Brazil – overtures of interest in a US
Trade Agreement
• India’s Momentum and Challenges
The State Department Role
• The Clinton Model
• John Kerry’s Approach
• Distractions
– Iran
– North Korea
– Syria
National Export Initiative
• NEI Video
Trade and Regulatory
Change Initiatives
Interagency Trade Enforcement Center
(ITEC) to take a “whole-of-government”
approach to monitoring and enforcing
Americans’ trade rights around the world.
ITEC uses expertise from across the federal
government to assert U.S. trade rights
obtained through various international trade
agreements.
Key Export Initiative Pieces
• Interagency Trade Enforcement
Center (ITEC)
• Export Promotion Cabinet (EPC)
• Trade Promotion Coordinating
Committee (TPCC)
• 70 NEI recommendations
The Export Promotion Cabinet and
the Trade Promotion Coordinating
Committee
In 2013, the EPC will coordinate through the TPCC the launch of innovative initiatives
including: a national marketing campaign targeting small and medium-sized exporters; an expanded
Export University Program; the “Global Business Solutions” trade financing packaging that will work
with community banks to expand the U.S. financial infrastructure offering trade-related products;
commercial statecraft training for foreign service officers; and public-private partnerships that will
deliver commercial services for U.S. businesses overseas. The Administration will also implement
the operational plans of the President’s Commercial Advocacy Task Force, which was created by
Executive Order in December 2012, including assembling deal teams and developing robust trade
leads for U.S. businesses. In 2013, the Administration will continue to increase collaboration with
U.S. cities and states to develop their own export plans, integrate Export.gov with BusinessUSA.gov
to better deliver online services, and continue implementing a national tourism strategy to boost U.S.
services sector exports.
Policy Recommendations
• Stay the Course on the primary trade
agenda objectives – be aggressive
• Clarify and focus the “enforcement
approach” to international violations
• Formalize and reiterate the State
Department’s “Trade Advocacy Role”
• Formulate a strategic approach to
combat protectionism in WTO and FTAs