The White House today released the President’s 2010 Trade Policy Agenda. The report is here and U.S. Trade Representative Ron Kirk issued a statement,”President’s 2010 Trade Policy Agenda Focuses on Growing American Jobs Through New Market Access and Enforcing Trade Rules.” The USTR bold-faced this paragraph in Ambassador Kirk’s statement:

“Ninety-five percent of the world’s consumers live outside the United States, and the President’s trade agenda will help to get American workers and businesses access to as many of those customers as possible - in ways that affirm our rights in the global trading system and that reflect American values on worker rights, the environment, and open dialogue here at home,” said Ambassador Kirk. “The priorities in this Agenda can work to strengthen the rules-based global trading system on which the nations of the world depend, while opening markets and ensuring that American businesses and workers receive the economic benefits of trade.”

Agreed.

The President’s Trade Policy Agenda is part one of the report. On the pending Free Trade Agreements with Panama, Colombia and South Korea, the report again offers the Administration’s general, but non-committal support that might lead to enacting the agreements, perhaps.

If these outstanding issues can be successfully resolved, we will work with Congress on a timeframe to submit them for Congressional consideration so our producers can take full advantage of the opportunities presented by these agreements.

Nothing new there, really.

UPDATE (2:15 p.m.): CQ Politics reports, “Little Indication of Movement on Stalled Trade Deals.” Unfortunately so.

(Frank Vargo, the National Association of Manufacturers’s vice president for international economic affairs, has blogged from Geneva this week at the ministerial meeting of the WTO.  This is his final report.)

Ah well, the strangeness and wonder of the WTO negotiating process continues. Consider, for example, the Chairman’s report at the conclusion of the 7th WTO Ministerial meeting that ended yesterday. (Report available here as .doc.)

The report states, “There was wide support for building on progress made to date. There was also support for not attempting to reopen stabilized texts.” (My emphasis.) This statement refers, among other texts, to the Non-Agricultural Market Access (NAMA) text that the U.S. has not accepted. The clear implication from yesterday, though, is that many consider the text to be done, agreed, and not to be revisited.

Stabilized texts? Excuse me, but when the NAMA chairman Luzius Wasescha wrote that text at the end of last year, he stated right in his own text that, “Even though the included text is accepted as a basis for further work, we are far from a consensus among Members.” He also added “Anyhow, everything is conditional in the deepest sense.”

Whoa! By what magic elixir do we move from that December statement to the Ministerial Chairman’s statement yesterday that there is strong support for considering the text wrapped up and immutable? Is this sleight of hand? Or does the WTO have all the collective memory of a computer with a fried hard drive?

Example two: Press reports indicate at the end of the conference European officials lamented, “Doha does not seem to be fully on the agenda of the United States … there is no sign today that the Americans are ready to go forward.” (AFP report.) One said, “They want more concessions for a more acceptable package for the US Congress. Now, the problem is to find a way without damaging what has been achieved so far.”

What hypocrisy! In private, European government officials and business representatives are quite free in admitting their analysis conforms perfectly with the U.S. view - they are getting virtually no new market access out of the proposal so far. But they are willing to accept that, because they believe if they were to press for more industrial market access, the developing countries would turn right around and demand more European concessions in agriculture.

That has the Europeans terrified, for they feel they have given all they possibly can in agriculture. One more grain of wheat will break the European back and result in a revolt that will cause them to pull out of the whole deal. So they would rather build Fortress Europe around their agriculture and forgo market access gains in the rest of the world.

Example three: Indian officials still indicate a reluctance to have India participate in sectorals (but not the same degree of “shut-the-door” resistance I saw last year). But at the same time, India has free trade agreements cooking or under discussion with China, Japan, the European Union and Canada - and when India’s Prime Minister visited Washington recently, he indicated a free trade agreement could be possible with the United States as well. So my question is, who’s left? Why can’t you make cuts in the Doha Round?

The problem isn’t that the United States isn’t showing leadership, for it is. I spoke with Ambassador Ron Kirk a couple of times in Geneva this week. He knows the point to the Doha Round is getting meaningful market opening, and he knows the road to Doha goes through Beijing, New Delhi, and Brasilia. The problem isn’t U.S. leadership. The problem is getting others to get off their defensive agendas and join the United States is a commitment to open markets and grow world trade.

(Frank Vargo, the National Association of Manufacturers’s vice president for international economic affairs, is blogging from Geneva this week at the ministerial meeting of the WTO. )

You know, the process here in Geneva is really interesting. It’s like a plane that forever flies at 50,000 feet and can never get lower. The WTO Doha process just can’t seem to get below the big picture. Ministers from WTO countries are gathered here this week to take stock of the Doha Round, state their political will for a conclusion in 2010, and think of what can be done to move forward. And guess what some of them have come up with? Another ministerial meeting!

They would gather together in Geneva in a couple of months to take stock of where things are, issue serious statements about how things have to move faster –- and probably call for yet another ministerial. If the process were facilitated by ministerial meetings and “mini-ministerials,” we could have had three trade rounds by now.

Fortunately, calling another ministerial meeting in a couple of months is an idea that does not seem to have elicited broad support –- and hopefully won’t before the ministers leave Geneva tomorrow. The U.S. Trade Representative, Ron Kirk, has the right idea – let’s do some work, some eyeball-to-eyeball negotiating and horse-trading, with support from the WTO process. You have to have produce something for the stockroom before you can take stock.

It is rather remarkable, I think, that the gulfs that have prevented agreement are well-known, very visible, have obvious solutions, and yet keep being ignored in terms of a work plan. The WTO negotiating process is a managerial nightmare, lacking substantive goals, management strategies, and tactical plans for achievement. Frankly, the process could benefit from fewer PhD’s and more MBA’s.

The goal of negotiating rounds is to liberalize trade by reducing trade barriers. The Doha Round, in addition, has the goal of creating the maximum new market access for the poorest countries. This is not rocket science. You identify where the market access obstacles are, and you devise plans for reducing or eliminating them.

In the industrial trade negotiations, one thing you have to do is cut tariffs. And if you are going to cut tariffs, you have to go where the tariffs are. And by the WTO staff’s own calculus, about 2/3rds of the tariffs assessed on global industrial trade are collected by the advanced developing countries – especially Brazil, China, and India.

Yet instead of pinpointing reduction of those barriers as a key objective back in 2001, when the round started, as the years passed by, the WTO negotiating process continuously reduced the pressure to cut those tariffs. The consequence has been the prospect of less and less market access for everyone – for the least developed countries, the United States, and everyone in between.

(Frank Vargo, the National Association of Manufacturers’s vice president for international economic affairs, is blogging from Geneva this week at the ministerial meeting of the WTO. This is his first report.)

This afternoon, Monday, November 30, 2009, marks the official start of the 2009 Geneva Ministerial Meeting of the World Trade Organization (WTO). Whether by design or coincidence, the Ministerial starts on the 10th anniversary of the failed Seattle Ministerial, which opened on November 30th, 1999. November 2009 is also the 8th anniversary of the launch of the Doha Round of trade negotiations.

I am in Geneva, and I was at Seattle. There are similarities and differences. The anti-globalization protests at Seattle were vicious, lengthy, and very destructive. So far, the protests in Geneva have been relatively mild, with some destruction, but limited to a small minority of the demonstrators. We’ll see what happens today.

There are also similarities in the status of the negotiations. The Seattle Ministerial failed not because of the demonstrators but because of failure to reach agreement - principally between the United States and Europe over agriculture and sectoral agreements in industrial trade. Agriculture seems, after eight years of negotiation, to be agreed but for a handful (albeit a difficult handful) of issues, but the sectoral trade agreements (eliminating tariffs in major industrial sectors) is still an unresolved issue.

The Ministerial meeting that starts today ostensibly is not for the purpose of negotiating the Doha Round. Instead the official focus is on reviewing the WTO’s activities and its contribution to development. In talking with people, though, it is clear that Doha is the big undercurrent. The hope is that with so many trade ministers gathered in one place, informal discussions can lead to a narrowing of differences among countries that can clear the way for negotiations early next year.

If those differences are not narrowed, it will be extremely difficult to wrap up the Doha Round in 2010, which is the current objective (the first goal was 2005). The differences are still profound. In the key area of manufactured goods, which comprise about 70 percent of world trade in goods and services, the gulf that has been there since the round started is still there: The advanced developing countries are unwilling to provide major cuts in their tariffs and trade barriers.

An addition to the Dispatch from the Front’s weekly schedule, a joint release from USDA, Commerce and the U.S. Trade Representative’s office, “Commerce Secretary Gary Locke and USTR Ronald Kirk Convene 20th Session of U.S.-China Joint Commission on Commerce and Trade in Hangzhou, China“:

WASHINGTON, October 21, 2009 — U.S. Secretary of Commerce Gary Locke and U.S. Trade Representative Ron Kirk will serve as co-chairs with Chinese Vice Premier Wang Qishan of the 20th session of the U.S.-China Joint Commission on Commerce and Trade (JCCT) held on Wednesday, October 28th and Thursday, October 29th in Hangzhou, China. U.S. Secretary of Agriculture Tom Vilsack will join this effort to address key U.S. trade and economic priorities. The 2009 JCCT marks the first time three Obama cabinet officials have traveled together to a key economic summit abroad.

The JCCT, established in 1983, is the main forum for addressing bilateral trade matters and promoting commercial opportunities between the United States and China.

“The first JCCT under the Obama Administration provides an important opportunity to engage China on trade concerns impacting American companies,” Secretary Locke said. “It is critical that we make progress on several priority issues, including intellectual property rights protection and enforcement, clean energy, medical devices and pharmaceuticals.”

More …

• USTR blog post, “Weekly Trade Focus: Joint Commission on Commerce and Trade“
• Dow Jones, “US To Press China On Intellectual Property Rights, Trade“
• Bloomberg, “China Talks Showing ‘Good Progress’ Before Meeting, Locke Says“
• AFP, “US seeks progress in high level trade talks with China”
• People’s Daily Online, “Protectionism may be key component to trade summit“

The National Association of Manufacturers very much appreciates the quick, forceful action today by the Administration, led by U.S. Trade Representative Ron Kirk, to respond to U.S. industry’s call of just two weeks ago for confronting the European Union’s unjustified ban on U.S. poultry.

The NAM was the only broad U.S. trade and industry group to join with our domestic poultry industry on September in a letter to Ambassador Kirk urging the U.S. Government to request formation of a formal Dispute Settlement panel in the World Trade Organization (WTO) in Geneva to pursue a WTO legal judgment against the EU’s blatant politicization of food safety. Today, the USTR made that request. (USTR news release.) We are delighted with Ambassador Kirk’s leadership and support from around the Administration to attack this 12-year-old problem.

NAM has long led the outcry from U.S. industry confronting the EU’s abuse of the regulatory process. Science is clearly on the side of US industry.  This EU ban on US poultry is all about Euro-politics and protecting a less-competitive European poultry industry.  Unfortunately we see the same abuse of sound science from the EU to keep other U.S. agricultural products, from advanced biotechnology products to beef, which have been proven to be safe out of the European markets. Food safety regulations in Europe, the United States or anywhere else around the world need to be based on sound science, as specified in WTO rules, not on politics.

Promoting exports for smaller-sized companies has been a theme this week, and it’s one we fully endorse. U.S. Trade Representative Ron Kirk yesterday announced that the USTR was going to focus more efforts on exporting for small- and medium-sized firms (see also Frank Vargo’s post).

Meanwhile, Baltimore manufacturer Drew Greenblat is showing exactly how it’s done.

The next welcome development comes from the Senate Commerce Committee’s Subcommittee on Competitiveness, Innovation, and Export Promotion, a hearing that starts at 2:30 p.m. Eastern today, “A World of Opportunity: Promoting Export Success for Small and Medium-Sized Businesses.”

Chaired by Sen. Amy Klobuchar (D-MN), the hearing features the following witnesses:

• Rochelle Lipsitz, Acting Assistant Secretary for Trade Promotion and Director General of the United States Foreign Commercial Service, U.S. Department of Commerce
• Alice Albright, Executive Vice President and Chief Operating Officer, the U.S. Export-Import Bank
• Tom J. Wollin, Director of International and Government Sales, Mattracks, Inc. of Karlstad, Minn.
• Liz J. Reilly, Director of TradeRoots, U.S. Chamber of Commerce
• Brad Pierce, President, Restaurant Equipment World, Orlando, Fla.

Excellent topics, exports and opportunities. The Commerce Committee will be webcasting the hearing at http://www.senate.commerce.gov

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.

From Dow-Jones, September 29, “US Secy Locke: Colombia Trade Pact Not Likely Ratified In ‘09“:

SANTIAGO (Dow Jones)–The U.S. Congress won’t likely ratify a free trade agreement with Colombia this year as it’s currently focusing on health care reform and energy-related legislation, U.S. Commerce Secretary Gary Locke said Tuesday.

“It’s pretty doubtful” that the pact will be ratified this year, although the Obama administration is pushing forward with this agreement and similar ones with South Korea and Panama, the secretary said, noting that U.S. Trade Representative Ron Kirk is heading up the effort to conclude the trade deals.

Speaking to reporters in Santiago on the sidelines of the third Americas Competitiveness Forum, Locke said the U.S. aims to strenghten its trade ties with Latin America as the U.S. and Latin economies have greatly benefitted from existing ties.

“It’s in everyone’s economic interest to have trade agreements and lower tariff barriers,” Locke said. He added that President Barack Obama has indicated the U.S. is seeking an equal partnership with the countries in the region.

Secretary Locke and U.S. Trade Representative Ron Kirk have been excellent evangelists for the economic benefits of trade agreements, but we’ve yet to see any of the advocacy converted into action.

President Obama spoke to two labor events in September, the AFL-CIO Labor Day picnic in Cincinnati and the AFL-CIO national convention in Pittsburgh. At neither event did he even mention the word “trade.” Organized labor could be forgiven for thinking the unions have been given a de facto veto over White House utterances or Congressional action on the pending free trade agreements with Colombia, Panama and South Korea.

It hardly seems like the political environment will improve for expanding trade in 2010, when labor uses its campaign cash to bludgeon candidates into toeing their line.

See also the Investor’s Business Daily editorial, “Serving Castro First“:

On the very day Colombia was humiliated by Locke’s comments in Chile, the State Department announced it had sent acting Deputy Assistant Secretary Bisa Williams to Havana to negotiate new agreements with the ruling Castro oligarchy…[snip]

So why isn’t Colombia getting the same “pace of steps”? All it gets are sorry excuses. The U.S.-Colombia trade treaty was signed in 2006 and is ready to go. Its only barrier is House Speaker Nancy Pelosi, who doesn’t want a vote because she knows it will pass.

No country has ever been strung along so cynically.

In July, the Office of the U.S. Trade Representative announced it would accept public comments on the U.S. free trade agreement with Colombia. The U.S.-Colombia Free Trade Agreement was signed on November 22, 2006, and if put into effect would lower tariffs on U.S. exports to the South American democracy. (USTR web resources.) Unfortunately, Congress has failed to act because of domestic political considerations, specifically the power of organized labor. The delay has made U.S. exporters less competitive and reinforced the image of the U.S. government as an unreliable negotiating partner. (Speaker Pelosi’s unprecedented move last year to set the trade agreement aside did the most damage in that last regard.)

The Obama Administration said it was soliciting additional comments to identify concerns and find a way to move forward with the agreement. The comment period closed September 15 (USTR statement, and the National Association of Manufacturers submitted its comments letter making the manufacturers’ case for the U.S.-Colombia Free Trade Agreement. Excerpts:

The U.S.-Colombia free trade agreement has the potential to have a significant positive affect on U.S. exports. There will be three types of effects: (1) expansion of U.S. exports stemming from the reduction and elimination of Colombian tariffs on U.S. production; (2) expansion of U.S. exports through the reduction of non-tariff barriers in Colombia and the trade facilitation measures they are committed to take; and (3) preservation of existing U.S. exports that would otherwise be lost if Colombia maintains its expansion of trade agreements with other nations who compete with the United States in manufactured goods, like Canada, Brazil or the European Union. Together, these three effects could total as much as $1.2 billion, according to the U.S. International Trade Commission (ITC) analysis of the Colombia TPA.

While almost all of Colombia’s exports enter the United States duty-free, U.S. manufacturers face
significant tariff barriers in Colombia. Colombia’s average import duty on manufactured goods is 11.3
percent. These duties, however, are assessed not only on the invoice value of the goods but also on the freight and insurance charges (known as the “C.I.F value”). When other charges are applied as well, the effective import duty on manufactured goods is 14 percent.

A wide variety of U.S. industrial products will benefit from the immediate reduction of these tariffs, the vast bulk of which would be eliminated immediately upon implementation of the agreement. The ITC’s analysis shows the largest increases in U.S. exports will be chemicals, rubber and plastic products, machinery and equipment, and motor vehicles and automotive parts. NAM analysis shows other sectors that stand to gain include processed food products, electronic and electrical equipment, and transportation equipment.

The manufacturing sector has lost about two million jobs in the recession, the recovery is just starting — we hope — and yet Congress has just ignored a trade deal that would encourage U.S. exports of manufactured products. The economic damage from this inaction will only worsen as other countries export and lock up market share.

So here’s a clear, specific step Congress can take to support U.S. manufacturing jobs: Enact the U.S.-Colombia Free Trade Agreement.