The United States is negotiating a state of the art, twenty-first Century, Free Trade Agreement with eight countries in the Pacific Rim. This “TransPacific Partnership” or TPP, brings together countries with which we have free trade agreements (Australia, Peru, Chile, Singapore) and countries with which we do not yet have open access to their markets (New Zealand, Malaysia, Vietnam and Brunei).

The NAM believes that the TPP should be the beginning of the Free Trade Area of Asia and the Pacific– which would include Japan.  Asia is the fastest-growing area of the world, and American manufacturers need to have open access to that market. 

Yesterday, the United States Trade Representative published Federal Register notices requesting comments on the expression of interest that Canada, Japan and Mexico have shown in potentially joining TPP negotiations in light of the TPP’s high standards for liberalizing trade. It also asked for specific issues of concern to the United States regarding barriers to manufacturing trade, including non-tariff measures. 

The NAM has called on the Administration to negotiate the broadest and deepest agreement and work with negotiating partners and domestic stakeholders to address sensitivities and concerns in a way that ultimately ensures the most comprehensive outcome possible. 

We welcome the interest of Canada, Japan and Mexico but the negotiations cannot go back to the starting place and begin all over again.  All three will need to eliminate non-tariff barriers which are still significant impediments to American exports given that Japan’s tariffs are very low, and Canadian and Mexican tariffs have been eliminated under NAFTA. A key question is how this can be done without delaying the conclusion of the agreement, at least among the original participants.

We hope that the consultations with the three governments will address quickly any issues that arise as a result of this request for comments so that the three can join the negotiations as soon as possible in 2012 and truly make the TPP the pathway to a Free Trade Area of the Asia-Pacific.

Stephen Jacobs is senior director of international business policy, National Association of Manufacturers.

The NAM has been making the point for some time now that manufactured goods trade with current Free Trade Agreement (FTA) partners is in surplus.  Our manufactured goods trade deficit is with countries that DON’T have FTAs with us.  It is amazing how many people have fallen for the myth that trade agreements are bad for us without bothering to seek the facts.

Third Way has just made understanding the facts easier.  They have come out with a terrific “infographic,” titled “Black is the New Red,”  that nails down the point that oil imports drive trade deficits: trade deals don’t.

Third Way’s graphic makes this point in an outstanding and instantly recognizable way. Everyone should look at it.  It reinforces what pro-trade agreement advocates know, and should be a real eye-opener for those who oppose trade deals because they think they are bad for American manufacturing and jobs.

Thanks, Third Way!

Also, it is important to know that the Commerce Department has begun posting the trade statistics with FTAs on their website www.trade.gov/fta .  Click on Trade Tables, at the left of the page.  The lower left hand part of page two of the trade tables shows clearly that we have a manufactured goods trade surplus with our current FTA partners.  As Third way points out, the overall balance with FTA partners is in deficit because of all the oil we get from NAFTA.

Frank Vargo is vice president for international economic affairs, National Association of Manufacturers.  

Today the Senate is continuing debate on legislation to extend the Generalized System of Preferences (GSP) and Trade Adjustment Assistance (TAA) programs.  We expect the Senate to wrap up debate later today and then vote on final passage which will move us another step closer to being able to pass the three pending free trade agreements.

This morning the National Association of Manufacturers sent a Key Vote letter on the GSP/TAA bill to Senators urging them to support the bill.

Manufacturers support the extension of GSP, which provides preferential access to certain imports from selected developing countries. Last year, $23 billion of imports came into our nation duty-free under GSP, nearly three-quarters of which were raw materials, components, parts, or other inputs used to manufacture goods here in the United States. GSP reduces these companies’ input costs, making their products more competitive with their global counterparts. Moreover, it is estimated that nearly 82,000 U.S. jobs are directly or indirectly associated with the importation and use of GSP-eligible imports.

The Senate Banking Committee approved legislation today to reauthorize the U.S. Export-Import Bank through 2015. The reauthorization measure, which was approved by a voice vote, would gradually increase the loan ceiling to $140 billion. In addition to increasing the Bank’s exposure cap, the bill would also direct the Bank to review its current domestic content requirements, with due consideration for maintaining and creating jobs in the United States, and encourage the Bank to increase financing of exports for renewable energy and energy efficient technologies.

Ex-Im Bank, which is self-sustaining, provides financing to U.S. exporters through direct loans, guarantees and payment insurance. Last year alone, Ex-Im authorized more than $26 billion in exports that supported an estimated 230,000 jobs at more than 3,300 companies across the country. 

Additionally, more than 80 percent of Ex-Im Bank’s transactions directly involve small businesses. Congress must swiftly move to reauthorize the Ex-Im Bank before it expires on September 30.

Lauren Airey is director of trade facilitation policy, National Association of Manufacturers.

The Canada-Colombia free trade agreement went into effect today. Canadian exports are now duty-free in Colombia.  Since the effective duty on manufactured imports into Colombia is 15 percent, that gives Canadian manufacturers an attractive advantage.

This adds further to the imperative of passing and implementing the U.S. – Colombia trade agreement.  Distributors, wholesalers, and retailers in Colombia may be willing to bear a 15 percent disadvantage in importing U.S. goods for a short time; but if they see that time difference persisting, many of them will consider shifting to Canadian suppliers wherever Canadian and American products compete with each other.

Passage of the U.S. – Colombia trade agreement by Congress does not mean the agreement goes into effect the next day.  Some months are needed after passage to ensure that both governments have done what they said they would do, that customs officials have their procedures and systems in place, and that necessary regulations have been published. So every day of legislative delay pushes implementation of the U.S. – Colombian agreement one more day into the future – adding to the risk of losing U.S. business.

Also, every day the pending trade agreements with Colombia, Korea, and Panama languish, American workers lose another $8 million in wages and benefits.  That adds up.  As of the afternoon of August 15, 2011, their cumulative loss was a staggering $12 billion.

Opponents of trade agreements are badly mistaken in thinking they hurt our trade. Over the past three years, American manufacturers have enjoyed a cumulative surplus of over $70 billion with our existing trade agreement partners.  During that same time, however, manufacturers faced a cumulative deficit of $1.3 trillion with countries that have not entered into trade agreements with us.

It is time to open more markets to American goods and services, starting with quick action by Congress to pass the three pending agreements.

This morning the National Association of Manufacturers joined by the American Farm Bureau Federation, Business Roundtable, Coalition of Services Industries, Emergency Committee for American Trade, National Foreign Trade Council, U.S. Chamber of Commerce and the U.S. Council for International Business issued a joint statement about the lack of progress in the Doha Round. Over the past few weeks talks in Geneva have stalled. Here is the joint statement issued today:

We deeply regret that the WTO Doha Development Agenda trade round has not yet been able to achieve its intended objective of promoting world economic growth by expanding trade.

Since 2001, the United States and the U.S. manufacturing, services, and agriculture communities have been steadfast in their support for the Doha Round and of efforts by U.S. and other negotiators to try to break the negotiating deadlock by offering constructive alternatives in each negotiating area. We continue to seek an outcome that would open markets around the world, produce new trade flows, grow our economies and sustain and create jobs. But an agreement will not be possible unless all major economies make meaningful contributions.
(continue reading…)

We have some sense of optimism on the state of the U.S. trade agenda today. On Friday The New York Times ran an editorial urging the Administration to move quickly on all three pending free trade agreements (FTAs) with Colombia, Korea and Panama.

The Colombian government is facing the first of several deadlines as laid out in the “action plan” they reached with the Obama Administration recently – and I’m betting they’ll deliver completely and flawlessly. And when they do, we would argue that there should be no delay in beginning the approval process of that agreement in Congress. The Korea FTA is ready to go as well, and it can join the Colombian agreement in receiving quick Congressional consideration (they can share a cab to the Hill, perhaps).

But leave room in that cab for the Panama agreement. Today USTR Kirk sent a letter to Congress indicating that USTR “has completed its preparatory work on the Agreement and stands ready to begin technical discussions with Members of Congress on the draft implementing bill and draft Statement of Administrative Action.” That means, let’s get to work on Panama. USTR Kirk has already sent such a letter on Korea. Following the April 22 action plan efforts by Colombia, could we see such a letter on the Colombia FTA as well? Within a few days, all three free trade agreements could be able to begin the journey to Congress for approval. We think “should” rather than “could.”

And it should be swift and bipartisan approval – there is strong support for all three agreements in Congress. President Obama has spoken in support of Korea and Colombia, and we expect he might have something similar to say about Panama now that the Tax Information and Exchange Agreement (TIEA)  has been ratified. The longer we wait, the longer barriers to our manufactured goods exports remain in place, even as some of our competitors race to implement their own agreements that will give them preferential treatment. The U.S. International Trade Commission estimates that $13 billion annually in new exports will be the result of the three agreements. $9 billion or so of that will be in manufactured goods exports. That means jobs in factories all around the country.

As Ways and Means Chairman David Camp says in a news release today, “The more we delay, the more we lose. The time to act is now.” Ways and Means Trade Subcommittee Chairman Kevin Brady adds “We are on the home stretch, and I welcome the opportunity to show the world that we once again have a market-opening trade agenda that creates U.S. jobs.” The NYT editorial noted “[t]hese agreements are good for the American economy and good for national security. Congress should waste no more time and approve them.”

We couldn’t agree more. Congratulations to the Martinelli Administration in Panama for quickly moving the TIEA through its ratification process. They’ve delivered what they were asked to do. We fully believe the Santos Administration in Colombia will just as quickly deliver what they’ve been asked to do in the recent action plan before April 22. With these actions, they should join Korea and move to Congress, where they will have a warm reception. Chairman Camp has repeatedly called for passage of all three FTAs by July 1, a proposal we strongly endorse. Put all three FTAs in a cab and drive them straight to Capitol Hill. Because when it comes to removing foreign barriers to U.S. manufactured goods — the meter’s running.

El Tiempo: Obama-Santos agreement on FTA, with 4 key points

Washington Post editorial, “Mr. Obama’s free-trade deal with Colombia“:

PRESIDENT OBAMA will welcome a bruised American ally to the White House on Thursday and take a step toward mending relations. For the past decade, Colombia has been a strong and steady U.S. friend at a time when leftist demagogues — including the presidents of two of its neighbors — have dedicated themselves to turning Latin America against the United States. Colombia’s reward was to be vilified by labor unions intent on torpedoing the free-trade agreement that it negotiated with the Bush administration and that has been neglected by Mr. Obama, who skipped Colombia during his recent tour of the region.

Mr. Obama’s agreement with Colombian President Juan Manuel Santos on an “action plan” for obtaining congressional ratification of the free-trade agreement could augur both a political and a foreign policy breakthrough for his administration. Mr. Obama, who will endorse the deal just days after launching his reelection campaign, gets points for political bravery: Though Colombia made substantial concessions to win the White House’s support, the pact will still be opposed by most unions and many Democratic members of Congress.

Bravery belated, perhaps, but very good in any case. As for the unions and anti-trade members of Congress, one doubts there would ever be a possible “compromise” that would lead them to support an agreement. Protectionism is a matter of core philosophy.

Rep. Steny Hoyer (D-MD), the House Democratic whip, issued a statement lauding the developments.

Today’s development on issues of worker rights and violence against workers is a positive and important step towards passage of the Colombia FTA. These issues needed to be addressed, and I am pleased the Administration and Colombian government have agreed to a concrete action plan. Colombia is a key ally in South America, and it is in our economic and national security interests to further strengthen that relationship. I look forward to working with the Administration to advance the Colombia FTA, which I continue to support. As we work to enact the three pending trade agreements, we must also extend expired provisions of the Trade Adjustment Assistance program that help American workers who have lost their jobs as a result of trade.”

Rep. Hoyer has been a clear and consistent supporter for many years, which also warrants mention as political bravery.

Of course, we knew about these benefits several years ago, back when the agreement between the two countries was first negotiated and concluded.

From the White House Fact Sheet:

The Agreement will remove significant barriers to U.S. goods from entering Colombia’s market:

• Over 80 percent of U.S. exports of consumer and industrial products to Colombia will become duty free immediately, with remaining tariffs phased out over 10 years. With average tariffs on U.S. industrial exports ranging from 7.4 to 14.6 percent, this will substantially increase U.S. exports.
• Key U.S. exports will gain immediate duty-free access to Colombia, including almost all products in these sectors: agriculture and construction equipment, aircraft and parts, auto parts, fertilizers and agro-chemicals, information technology equipment, medical and scientific equipment, and wood.

And, on IPR:

Greater Protection for Intellectual Property Rights: The Agreement provides for improved standards for the protection and enforcement of a broad range of intellectual property rights, consistent with U.S. and emerging international standards of protection and enforcement. Such improvements include requirements for IPR protections that are critical to protecting copyrighted works like music, movies, and software from piracy in the digital environment; requirements for strong, deterrent criminal penalties against copyright piracy and trademark counterfeiting; requirements for robust patent and test data protection that respects the Doha Declaration on TRIPS and Public Health; and state-of-the-art protection for U.S. trademarks.

And …

From The White House, a statement and fact sheets.

President Obama is committed to pursuing an ambitious trade agenda that will help grow our economy and support good jobs for U.S. workers by opening new markets.  To achieve that objective, we seek to provide a level playing field that creates economic opportunities for U.S. workers, companies, farmers, and ranchers, and that ensures our trading partners have acceptable working conditions and respect fundamental labor rights.  As part of this broader trade agenda, the Obama Administration has worked closely with the government of Colombia to address serious and immediate labor concerns.  The result is an agreed “Action Plan Related to Labor Rights” that will lead to greatly enhanced labor rights in Colombia and clear the way for the U.S.-Colombia Trade Agreement to move forward to Congress.  The U.S.-Colombia Trade Agreement will expand U.S. goods exports alone by more than $1.1 billion and give key U.S. goods and services duty free access in sectors from manufacturing to agriculture.  It will increase U.S. GDP by $2.5 billion and support thousands of additional U.S. jobs.

• FACT SHEET: Benefits of the U.S.-Colombia Trade Promotion Agreement
• FACT SHEET: Leveling the Playing Field: Labor Protections and the U.S.-Colombia Trade Promotion Agreement
• FACT SHEET: Trade & the U.S.-Colombia Partnership
• FACT SHEET: U.S.-Colombia Trade Promotion Agreement: Expanding Markets for America’s Farmers and Ranchers