Tag: Trade

Growing Manufacturers’ Opportunities in the Asia Pacific: U.S. Push for Ambition and Market Access in TPP Must Continue

With President Obama’s Asia visit kicking off in Japan today, manufacturers are hopeful that the President and Japanese Prime Minister Shinzo Abe will make meaningful progress towards achieving ambitious and market-opening outcomes in the Trans-Pacific Partnership (TPP) negotiations, and that work will continue during the President’s visit to Malaysia to meet Prime Minister Najib Razak later this week. Manufacturers have long supported the negotiation of the TPP that TPP Leaders described in November 2011 that “will be a model for ambition for other free trade agreements in the future, forging close linkages among our economies, enhancing our competitiveness, benefitting our consumers and supporting the creation and retention of jobs, higher living standards, and the reduction of poverty in our countries.” Already, comprehensive, high-standard U.S. free trade agreements help propel nearly 50 percent of manufacturing goods exports around the world.  A TPP done right will boost the United States’ already record manufacturing exports, as well as other sales and other commercial opportunities, by linking America’s highly productive manufacturers to new consumers around the world.

As recognized by each of the TPP countries then and as manufacturers have long advocated, such an agreement must:

  • provide comprehensive market access that concretely levels the playing field;
  • ensure high standards on issues such as intellectual property, transparency and investment;
  • address new trade challenges such as cross-border data flows and longstanding issues such as competition from state-supported enterprises; and
  • incorporate strong enforcement mechanisms so that the agreement is more than words on a piece of paper.

When Japan joined the TPP talks in 2013, it committed to negotiate on the same ambitious basis that the existing TPP negotiating countries had already agreed. U.S. Trade Representative Ambassador Mike Froman said today in Japan, the talks are at a “crossroads” and now is the time for Japan “to choose a bold path.”  Manufacturers agree.  Similarly bold choices must also continue in the capitals of all TPP partners to achieve an ambitious and fully market-opening outcome. Manufacturers urge Japan, Malaysia and all other TPP countries to continue to focus on that ambition this week and in the weeks to come so that the momentum of the TPP talks can be regained and that the TPP  countries’ commitment to an “ambitious, high standard and comprehensive”  agreement that was renewed in December 2013 can be achieved.

A successful TPP agreement that truly opens markets and improves the competitiveness of manufacturers in the United States represents an unprecedented opportunity to boost commercial ties throughout the Pacific Rim and beyond. The NAM continues to urge the immediate and comprehensive elimination of tariffs and non-tariff barriers, strong protections consistent with U.S. practice on intellectual property and investment for all products, new provisions to permit the movement of data cross border and new disciplines to ensure fair commercial competition with state-owned enterprises. These provisions all must be backed up by state-of-the-art enforcement provisions from state-to-state to investor-state mechanisms. Ultimately a successful, growth-producing TPP agreement will be one that ensure that manufacturers in the United States will be put on a fair and competitive footing in each of the TPP markets.

President Obama, Prime Minister Abe and Prime Minister Najib Razak have a critical opportunity this week to inject new vitality into the TPP talks. Manufacturers hope they will seize this occasion to move the negotiations closer to a pro-growth and pro-competitive conclusion.

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


Ex-Im Critics Ignore Reality; Re-Authorization is Really about Jobs and Competitiveness

Over the last days and weeks, critics of the Export Import Bank (Ex-Im) have talked about lots of issues and attempted to smear lots of mud. Yet, they continue to ignore the crux of the Ex-Im issue: American jobs and American manufacturing competitiveness.

While critics may enjoy debates inside isolated ivory towers, our nation’s manufacturers have no such luxury. Manufacturers big and small, in communities across the country, face a highly competitive global economy every single day. Every sale made can mean jobs that are saved or new jobs are created. When they lose out to foreign competitors for sales, our nation’s manufacturers are faced with tough choices as they struggle to make payroll and keep their business on track.

Critics of Ex-Im’s reauthorization seem to ignore a basic fact of the global economy when complaining about sales of airplanes to foreign airlines or sales of capital equipment to foreign mining projects. The fact is that other countries are building up their infrastructure and striving to meet growing domestic demand for energy, transportation, water, crops and telecommunications. These projects are moving forward regardless of what the U.S. Congress does or doesn’t do on Ex-Im Bank reauthorization. The issue that Ex-Im reauthorization presents is whether those foreign projects will use products made in the United States by American workers or whether those sales will go to our competitors in Asia, Europe or elsewhere.

Outside the United States, at least 59 foreign export credit agencies (ECA) are working intensively to give our foreign competitors a leg up in sales in fast-growing overseas markets. Those ECAs do not hesitate to support all types of projects, with far less rigor than Ex-Im already places on the sales for which it provides financing, insurance, loan guarantees and other services.

The United States has led efforts to impose important disciplines on ECAs, particularly those for member countries of the Organization for Economic Cooperation and Development (OECD). In 2011, the United States negotiated a new Aircraft Sector Understanding to bring official ECA financing rates more in line with commercial rates, taking away incentives for credit-worthy airlines to use ECA financing. That new agreement went into effect in 2013, and we’ve seen the commercial markets respond by picking up more financing for aircraft. But U.S. leverage has waned as critics seek to have the United States unilaterally disarm its own Ex-Im activities.

While the critics focus on a few large companies that use Ex-Im services (which not only support jobs in their own companies but also in thousands of small and medium-sized companies throughout their supply chains), they ignore the nearly 90 percent of Ex-Im transactions in FY2013 – some 3,413 transactions – that directly supported small businesses. As the NAM’s new Exporters for Ex-Im blog post series will highlight in the days and weeks to come, small and medium-sized businesses make up the lion’s share of Ex-Im’s activities. Ex-Im’s support of dynamic small business exporters like Wallquest has helped small businesses enter and expand export sales – thereby growing not only their manufacturing production, but the number of their employees.

At a time when the global economy is starting to show some growth, and we know our global competitors are seeking to win every sale, the question for lawmakers voting on Ex-Im reauthorization this year is actually quite simple: Do you want foreign purchasers to buy products manufactured in the United States with U.S. workers? If so, support Ex-Im reauthorization. Manufacturers do.

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


Growing Manufacturers’ Opportunities in the Asia Pacific: Seizing Huge Growth Potential

The President’s visit to Asia this week should highlight the value of strengthening trade and investment ties and identifying areas for increased commerce and cooperation throughout the Asia-Pacific region. We believe that increased American economic and commercial engagement in the Asia-Pacific is critical unlocking numerous growth opportunities for manufacturers in the United States.  The Asia-Pacific represents a huge market with an even greater growth potential that we hope the President’s trip can help catalyze.

Already, the Asia-Pacific region is a strong and growing purchaser of U.S. manufactured goods. Three of the top ten export destinations for U.S. manufactured goods are in Asia (China, Japan and South Korea). Total U.S. manufactured goods exports to Asia grew from $213.25 billion in 2009 to more than $331.56 billion in 2013. More specifically, transportation equipment exports from the United States to Asia nearly doubled from $30.21 billion in 2009 to just over $60 billion last year. Computer and electronic product exports also grew from roughly $55.61 billion in 2009 to $67.08 billion in 2013. Chemical exports to Asia also increased by $13.4 billion over the last five years.

Yet the potential for greater growth for manufacturers in the United States is substantial The Asia-Pacific region boasts nearly 60 percent of global GDP and is the fastest growing region in the global economy. The Asia-Pacific also makes up roughly half of the world’s population, making it a market ripe for more U.S. export growth.

To boost manufacturers’ export and sales opportunities in the region, more work is needed to eliminate tariff and non-tariff barriers, expand commercial relationships and ensure our trading partners play by the rules of the international trading system. The United States is seeking to negotiate a comprehensive, high standard and market-opening Trans-Pacific Partnership (TPP) agreement that would include our Asia-Pacific partners (Australia, Brunei, Japan, Malaysia, New Zealand, Singapore, and Vietnam) along with several Western Hemisphere partners (Canada, Chile, Mexico and Peru). The United States is also negotiating a bilateral investment treaty (BIT) with China, and efforts are underway to expand relationships with the Association of Southeast Asian Nations (ASEAN). More broadly, the United States has cooperated with 20 of our Asia-Pacific trading partners through the Asia Pacific Economic Cooperation (APEC) forum to expand economic ties and develop stronger frameworks in numerous areas, from trade in environmental goods and transparency to creating a stronger enabling environment for infrastructure investment. At the same time, though, there are over 130 other trade agreements in the Asia-Pacific that exclude the United States and put manufacturers at a substantial disadvantage in other Asian markets.

To move successful trade negotiations forward and eliminate the competitive disadvantage that manufacturers in the United States face in many Asian markets, enactment of Trade Promotion Authority (TPA) is critical. Both the President and Congress need to work closely together to move a strong TPA bill. In January, the Bipartisan Congressional Trade Priorities Act was introduced to facilitate the negotiation and implementation of comprehensive and ambitious trade agreements and require intensive consultations throughout the negotiating process. Despite repeated calls by manufacturers and the broader business community, no further action has been taken on this or any other TPA legislation. To grow substantial new commercial opportunities in the Asia-Pacific, action on TPA is critical.

As Commerce Secretary Pritzker so aptly stated in a speech last week at Johns Hopkins School of Advanced International Studies: “We can act now to advance American values and interests in setting the rules for trade in a region representing 40 percent of the world’s economy, or we can let others with different values and interests take the lead.” Manufacturers agree that the time is now for the United States to lead in this region, where significant growth opportunities are awaiting U.S. exporters.

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


Manufacturers Testify Before House Ex-Im Panel

Yesterday, manufacturers like Boeing and FirmGreen participated in a panel hosted by House Financial Services Committee Ranking Member Maxine Waters (D-CA) to highlight the critical importance of reauthorizing the U.S. Export-Import (Ex-Im) Bank. Ex-Im Bank faces a tough reauthorization fight in Congress this year.

Manufacturers, especially small and medium-sized manufacturers, cannot afford a lapse in the financing support that helps them stay competitive in the global marketplace. Most of the Bank’s financing deals help small businesses, Ex-Im Chairman and President Fred Hochberg told the panel. Hochberg spoke with the NAM’s Member Focus magazine last year about efforts to help businesses of all sizes.

Unfortunately, manufacturers are already facing the consequences of the uncertainty surrounding Ex-Im’s reauthorization. FirmGreen CEO Steve Wilburn told lawmakers that his company lost a $57 million contract to a South Korean competitor because reauthorization legislation faces an uncertain future in Congress. “I just want you to understand the impact on people in my company, me personally and the people in the Midwest that I can’t give those jobs to,” he said. “To me, it’s unconscionable that we allow this debate to rage on a partisan basis.”

Ted Austell, Boeing’s vice president of executive, legislative and regulatory affairs, said that Ex-Im supports the company’s 160,000 employees, 15,000 suppliers and vendors, and hundreds of thousands of workers connected to the aerospace sector. “In a word, it’s jobs,” he said.

House Democratic Whip Steny Hoyer (MD) addressed the panel yesterday afternoon, and he indicated that he will make Ex-Im a legislative priority. The NAM appreciated Rep. Hoyer’s outstanding leadership during the last reauthorization of Ex-Im, and we are very pleased that he continues to make this issue a priority. It is a critical tool that allows our small, medium and larger manufacturers to compete globally. Rep. Hoyer announced at a press conference earlier today that he is including Ex-Im Bank reauthorization in his manufacturing initiative.

This evening, Rep. Denny Heck (D-WA) and other members of the New Democrat Coalition will take to the House floor to discuss the Ex-Im Bank’s positive impact on American jobs during a “special order.” You can follow along with the New Dems on Twitter here.

The NAM will continue to advocate for Ex-Im Bank’s reauthorization on Capitol Hill and with the Administration. In March, we spearheaded a letter that was joined by more than a dozen other business leaders to urge the Senate Banking, Housing and Urban Affairs Committee and the House Financial Services Committee to take immediate action on legislation. We’re also engaging our members to add their voices and influence. Click here to learn more about what manufacturers can do today.

VN:F [1.9.22_1171]
Rating: 5.0/5 (1 vote cast)


NAM’s President and CEO Jay Timmons Voices Manufacturers’ Priorities in Europe

This week, the NAM’s President and CEO Jay Timmons and I are in Brussels, Belgium and Berlin, Germany to advance manufacturing priorities in the Transatlantic Trade and Investment Partnership (T-TIP) negotiations and to strengthen U.S.-European trade and investment ties.

Our first meeting on April 2 was with Member of the European Parliament Robert Sturdy, vice chair of the European Union (EU) Parliament’s International Trade Committee. We discussed ways to strengthen our collaboration in advocating for an ambitious, high-standard, comprehensive T-TIP agreement. Jay and I also discussed critical trade issues with U.S. Ambassador to the EU, Anthony Gardner, and EU Trade Commissioner Karel DeGucht.  We also discussed manufacturers’ T-TIP priorities and opportunities to strengthen our partnership with Business Europe and other leading business organizations and manufacturers. In Berlin, we’ll be meeting with a range of government and business leaders as well as U.S. Ambassador to Germany John Emerson.

Throughout this trip we have been advocating for a T‑TIP agreement that will significantly expand trade and investment between the United States and the EU and address global issues of common concern.  A comprehensive T-TIP would strengthen both our economies, which account for nearly half of global output of goods and services and 30 percent of global trade.

Jay has been emphasizing the importance of an agreement that further opens the transatlantic market, protects innovation and eliminates unnecessary barriers. He has also been identifying key priorities for manufacturers from regulatory coherence and transparency, to tariff elimination, intellectual property and investment protections and data flows, as well as highlighting opportunities for the EU and United States to work together to address common trade and investment challenges in markets around the world.

Next week, we head to Hannover, Germany, where Jay will speak at Hannover Messe 2014, the world’s largest industrial trade fair. In Hannover we will also meet with key policymakers and industry leaders to discuss the challenges and opportunities facing manufacturers on both sides of the Atlantic, including advanced manufacturing, export models and skills training.

Jay will continue strongly voicing the high priority that manufacturers place on expanding international trade and investment ties with the EU and U.S. government leaders, leading European business associations and NAM member companies that are key to shaping the T-TIP negotiations.

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


A Better Way to Do Business in India: Scrap Discriminatory Policies and Engage on Constructive Solutions

How can India grow its emerging electronics equipment and ICT manufacturing sector? Not with a costly and discriminatory Preferential Market Access (PMA) policy. That’s what Stephen Ezell concludes in a paper released by the Information Technology and Innovation Foundation.

India’s PMA policy mandates local content requirements for as much as much as 30 percent of India’s $20 billion ICT market. By the end of next year, a quarter of the value of mobile phones and computer tablets, desktops, printers, keyboards, servers, memory cards and network equipment must be added in India. That share will rise to 45 percent in 2015 and to 80 percent by 2020.

PMA would block U.S. exporters from a large segment of India’s fast growing ICT market. India boasts the world’s second largest telecommunications network, with a subscriber base that has ballooned from less than 40 million in 2001 to nearly 850 million in 2011. Even without trade distorting preferences, the value of India’s ICT equipment production more than doubled between 2004 and 2009.

But, as Ezell points out, PMA is just as bad for India. Beyond the damage to U.S. and other overseas suppliers, the policy would “impose costs on India’s economy and citizens” without delivering production growth, increased security or better products or services. Overseas investors are already fleeing the sector. FDI in India’s telecommunications sector fell from $2 billion in the period from April 2011-March 2012 to just $300 million from April 2012-March 2013.

Ezell calls on the Indian government to repeal PMA and replace it with measures that can truly drive manufacturing growth and competitiveness. Specifically, he urges India to invest in infrastructure, workforce training and scientific research. He recommends tax and investment incentives to lure overseas firms and an end to an inverted Indian tariff structure that makes it more costly to import component parts than finished equipment.

Manufacturers in the United States are eager to engage on these and other constructive solutions. We continue to seek meaningful dialogue. But to get there, India must end its destructive “talk to the hand” approach to bilateral trade and commercial concerns. The U.S.-India Trade Policy Forum has not met since 2010. No other relevant forum, such as the High Tech Cooperation Group, or the ICT working group has met since 2011.

Early next month, the Indian people will go to the polls to choose new leadership. Manufacturers look forward to working closely with India’s next government. Together, we can find a better way of doing business.

The National Association of Manufacturers is co-chair of the Alliance for Fair Trade with India (AFTI). Click here for more information.

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


KORUS Agreement Has Shown Strong Results on Two-Year Anniversary

March 15th marked the two-year anniversary of the Korea-U.S. Free Trade Agreement’s (KORUS FTA) entry into force and the facts are clear. Despite what some trade critics say, exports of U.S. manufactured goods to Korea have increased.  Thanks to KORUS, more than 95 percent of U.S. industrial and consumer goods are entering the Korean market duty-free, and as a result, exports of U.S. manufactured goods to Korea have gone up 3.1 percent or $1 billion since the agreement was implemented. Specifically, exports of electrical equipment, appliances and other components jumped 22.5 percent and exports of pharmaceuticals experienced a huge increase of 52 percent! Moreover, U.S. manufactured goods saw an increase in exports to Korea of 9.2% from January 2013 to January 2014, while manufactured goods exports from Korea to the U.S. only increased 3.1 percent.

The U.S. Trade Representative’s (USTR) Office released a fact sheet on the enhanced opportunities the KORUS agreement has created over the last two years. “In its second year, this landmark agreement continues to provide tangible benefits for American businesses, workers, and farmers exporting to our sixth-largest trading partner,” USTR stated.  As USTR notes, the overall U.S.-Korea trade balance has been negatively impacted by decreases in corn and fossil fuel exports due to the U.S. drought in 2012, but those events are unrelated to the agreement’s implementation. USTR also noted slowed economic growth in Korea over the past two years was associated with decreased demand for all of its imports – not just those from the United States. In addition, the European Union’s free trade agreement with Korea entered into in July 2011, so it is likely that manufacturers in the EU had the advantage of moving their products into Korea’s market first.  As the global economy continues to improve, we hope to see even stronger U.S. exports to Korea.

At the same time, the NAM is working closely with our members, USTR and the Korean government to resolve some key issues with KORUS implementation including customs issues for certain U.S. exports to Korea and an array of non-tariff barriers, especially in the auto sector, which greatly impede manufacturers’ access to the Korean market. Last week, Korean ambassador to the United States Ahn Ho-young expressed a commitment to addressing any outstanding issues with implementation of the KORUS agreement. It is critical that Korea remain focused on resolving these challenges and that the Korean government continue working with the U.S. government to respond to market access concerns from manufacturers in the United States – especially if it is serious about seeking accession to the Trans-Pacific Partnership (TPP) agreement.

Additionally, more work needs to be done to ensure that manufacturers in the United States are aware of the new export opportunities in Korea resulting from the KORUS FTA. Manufacturers can visit FTA Tariff Tool to determine tariff levels for their exports to Korea.

While it’s still too early to determine the full impact of KORUS on U.S. manufactured goods exports, a closer look at the numbers reveal that they are headed in the right direction, and manufacturers believe that continued cooperation with Korea will only strengthen our economic ties and expand the benefits of the KORUS agreement.

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


Ex-Im Bank Levels the Global Playing Field for U.S. Manufacturers

In the face of tough competition overseas, the Export-Import Bank (Ex-Im) is a critical tool the U.S. government has to boost U.S. exports and grow manufacturing jobs.

Opponents continue to paint Ex-Im Bank as a costly and unnecessary entity focused solely on providing credit to our nation’s largest exports. That is simply false.

Ex-Im Bank helps U.S. companies, many of them small and medium-sized manufacturers, offset some of the financing support that their foreign competitors receive from their governments. The Bank also helps U.S. companies to secure new customers and increase market share in emerging markets.

In FY2013, nearly 90 percent of Ex-Im Bank’s transactions directly supported small business — providing $5.2 billion in direct support for small business exporters. Small businesses like BTE Technologies in Maryland and Polyguard Products in Texas rely on Ex-Im export financing and insurance to grow their exports and add U.S. jobs. Lion Precision in Minnesota turned to Ex-Im Bank’s single buyer insurance program to bolster exports to countries like China and Japan. A small company with 35 employees, Lion Precision designs, manufactures, tests and ships high-tech sensors. Last year, more than 60 percent of the company’s sales were outside the United States.

Simply put, our foreign competitors use every tool available to aggressively pursue greater market share by offering enticing financing terms. The playing field needs to be level, and Ex-Im Bank is crucial in achieving that. At least 59 other foreign export credit agencies provide significant support to our competitors around the world. And in some cases, foreign customers insist on official export credit agency support for projects.

In the aerospace sector, Ex-Im has helped ensure that the U.S. industry remains competitive, enabling the aerospace sector to produce a positive trade balance of trade of $73.5 billion in 2013. These exports support U.S. jobs at large companies and small, both directly and indirectly. As Ex-Im Bank Chairman Fred Hochberg noted earlier this week, aerospace is the top U.S. export after agriculture. Given the high value and high volume of sales, general aviation and commercial aircraft can — in some years — make up a large portion of Ex-Im Bank’s portfolio.

In the last five years (FY09 to FY13), Ex-Im Bank assisted in financing more than $188 billion of U.S. exports and supported 1.2 million American jobs – in a public-private partnership that actually generates revenue for the taxpayer. The Ex-Im Bank is a self-sustaining agency, generating more than $1 billion for the U.S. Treasury last year — after covering its own operating costs.

In September, the Bank’s charter will expire. Congress should act now to reauthorize Ex-Im Bank. Otherwise, U.S. manufacturers small and large will increasingly find themselves locked out of the competition in global markets, an outcome that would be bad for the economy and for jobs.

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


NAM Applauds Critical Step Taken by the Pacific Alliance

The NAM welcomes this week’s announcement by the Pacific Alliance – Chile, Colombia, Mexico and Peru – that they have signed an agreement to eliminate tariffs on 92 percent of goods. The other 8 percent of tariff eliminations will be phased in over time. The Alliance of these Latin American nations was kicked off in April 2011 and formalized in June 2012. Together, these four countries comprise 210 million people – more than a third of Latin America’s population and more than Brazil’s. Combined they boast an economic output of 35 percent of Latin America and the Caribbean’s GDP and roughly 50 percent of Latin America’s trade flows. The Alliance’s objectives include economic integration and a gradual move towards the free circulation of goods, services, capital and persons. But perhaps one of the Alliance’s primary goals is to deepen the region’s trade ties with Asia, whose markets are rapidly expanding.

This critical first step by the Alliance is substantial and much needed in a region where trade-liberalization has been under attack in recent years. For example, Argentina has broken a number of its core WTO commitments and the United States, Canada and others have a pending WTO case against them. There are also ongoing concerns about Brazil’s use of localization requirements to effectively close its market to U.S. and other exports. The four members of the Pacific Alliance, on the other hand, have long supported the ideals of free trade and market-opening agreements.

The Pacific Alliance is being characterized as a living agreement and Costa Rica has indicated its intention to sign on as a full member. A prerequisite of acceding to the Alliance is having free trade agreements in force with the other members. While Costa Rica has agreements with all four, its deal with Colombia has not yet been implemented. Notably, the United States has observer status, along with 22 other nations, including Germany, Great Britain, and Italy which will not be allowed to join as full members as they fail to meet the second requirement, which is having a coastline on the Pacific.

VN:F [1.9.22_1171]
Rating: 5.0/5 (1 vote cast)


Manufacturers Look South

Today, a delegation of 17 companies and U.S. Secretary of Commerce Penny Pritzker wrap up a five-day trade mission to Mexico. The delegation included manufacturers like Boston Scientific and Vermeer, who participated in meetings with high-level Mexican officials and business leaders to discuss commercial opportunities and promote U.S. exports.

Mexico is the United States’ second-largest export market, with over $200 billion in manufactured goods exports in 2013. The Department of Commerce recently announced Look South, an initiative designed to help companies access this market and the United States’ other 10 Free Trade Agreement (FTA) partners in Latin America. FTAs increase market access for manufacturers by lowering tariff and non-tariff barriers. Data released yesterday is evidence that manufacturers are benefiting from these agreements. Click here more information about Look South and here for information on how to take advantage of the program.

 

VN:F [1.9.22_1171]
Rating: 0.0/5 (0 votes cast)


A Manufacturing Blog

  • Categories

  • Connect With Manufacturers

            
  • Blogroll