The NAM applauds today’s announcement that the U.S. Trade Representative (USTR) is seeking to improve how trade policy can bolster the export opportunities of small and medium-sized enterprises (SMEs). As SMEs account for one-third of all U.S. exports, this is a very important step on the part of USTR. The NAM represents thousands of SME exporters and looks forward to working with USTR, Commerce, and other agencies on this very welcome initiative.

SMEs already benefit greatly from U.S. trade policy. For example, SMEs account for 95 percent of all U.S. exporters to NAFTA, and ship an average per company of $630,000 a year to that market – pretty important sales to smaller companies. And SMEs account for 44 percent of U.S. exports to the nations of CAFTA — averaging $440,000 per company.

However, while SMEs benefit strongly from Free Trade Agreements and multilateral tariff-cutting negotiations, some aspects of trade policy bear more heavily on SMEs than large exporters. For example, complex and confusing rules of origin (where a product is produced) and labeling requirements are extremely difficult to comply with for small firms. Different foreign product standards and costly testing and certification requirements can pose insurmountable obstacles for some smaller firms. Focusing new trade policy initiatives on these obstacles in addition to continued market opening could really boost smaller company exports.

USTR’s request that the International Trade Commission examine export obstacles and opportunities is a great next step. Expanded policy attention to the particular export challenges faced by SMEs can pay big dividends, particularly if coupled with expanded export promotion services to get the job done. The NAM thinks that doubling smaller company exports would be a great goal, adding over $300 billion to U.S. exports, and lots of high-paying jobs.

Perhaps overlooked in the holiday rush, the winter storms and media slumber was the U.S. recognition of Costa Rica’s official entry into Central American Free Trade Agreement, also known as CAFTA-DR (the DR being Dominican Republic). The completion of CAFTA represents an important reaffirmation of trade’s economic value and importance in supporting Latin America’s democracies. We hope the Obama Administration recognizes the opportunities that should be embraced.

Reuters, “Bush clears way for Costa Rica to join CAFTA“:

WASHINGTON (Reuters) - President George W. Bush cleared the way on Tuesday for Costa Rica to formally join a regional free trade agreement between the United States, the Dominican Republic and four other Central American countries.

Bush issued a proclamation that brings the pact into force between the United States and Costa Rica on January 1.

“This step marks an important milestone in our relationship with Costa Rica, building on our strong economic and political partnership,” U.S. Trade Representative Susan Schwab said.

More…

• Presidential proclamation, “To Implement the Dominican Republic-Central America-United States Free Trade Agreement with Respect to Costa Rica and for Other Purposes.“
• U.S. Trade Representative, “Statement of U.S. Trade Representative Susan C. Schwab Regarding Entry into Force of the CAFTA-DR for Costa Rica.“
• The USTR’s website with the text and background of CAFTA-DR is here.

Usually this sort of Christmas week release is designed by the releasing party, in this case the White House, to bury the news. That seems less likely this time, as various delays and process steps ran up against a December 31, 2008, deadline for action. (See this article from Inside Costa Rica for the timeline.)