Tag Archives: U.S.

U.S.-Brazil trade to strengthen

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Brazil and the United States made significant strides to bolster the economic relationship between the two countries at the eighth meeting of the U.S.-Brazil CEO forum, which was held this week in Brasilia.

“It is clear that both the Obama and Rousseff administrations recognize that our two countries must continue to build on the strength of U.S.-Brazil economic relations,” said U.S. Deputy Commerce Secretary Rebecca Blank said in a statement.

At the forum, representatives from both countries heard from private sector leaders on how they could help business in both nations succeed. The recommendations ranged from tax issues, to cooperation on infrastructure, to educational exchanges.

Trade between the U.S. and Brazil has skyrocketed in recent years – exports to Brazil totaled $65 billion in 2011, and the U.S. is Brazil’s largest source of imports. However, doing business in Brazil requires intimate knowledge of the local environment, known as the “Custo Brasil,” and infrastructure limitations pose a logistical challenge.

The Consul General of Brazil, Luiz Felipe de Seixas Correa, will be speaking on these trade issues at Amber Road’s free Retail Seminar, “Financial Returns in Global Trade,” on April 17 at the Gansevoort Park Avenue Hotel in New York City. Aside from hearing a top expert discuss trade with Brazil, you can learn new strategies for delivering financial returns on your global supply chain and network with your peers at the beautiful Gansevoort Hotel.

Retailers looking to learn how to improve their global trade operations should register here!

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US, EU Look to Boost Economies with Trade Pact

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After years of trade disputes, US and European Union officials are considering a drastic change in direction: a US-EU trade pact. It would be the world’s largest trade agreement, and could give a significant boost to both struggling economies.

Negotiations are still in the preliminary stages, and both sides will have much to overcome — including differences on agriculture, food safety, and climate change legislation — but top EU and US officials insist they want to see the pact happen. Even America’s main labor group, the AFL-CIO, which usually opposes such trade pacts, said it wouldn’t interfere with this one. Secretary of State Hillary Clinton also appears to be in support of the trade agreement:

If we get this right, an agreement that opens markets and liberalizes trade would shore up our global competitiveness for the next century, creating jobs and generating hundreds of billions of dollars for our economies.

Labor unions in the States have tried to discourage huge trade agreements ever since the politically fraught debate over the passing of NAFTA in 1991, arguing that starkly lower wages and lax environmental regulations in certain countries would place American workers at a competitive disadvantage. Those issues don’t seem as pressing in deals with the EU.

Big business in the US appears to give similar support.

However, negotiators do not have an easy path ahead. The most recent dispute concerns EU’s carbon trading scheme, which could penalize American airlines that don’t meet EU standards. Intellectual property laws and food safety regulations also differ broadly across the Atlantic, as do agricultural restrictions on the use of genetically modified foods in Europe.

Enthusiasm seems to be the most common factor across these economies right now. Where do you think these negotiations will lead?

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US-Led Trans-Pacific Partnership May Have Chinese Competition

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The Obama administration is looking to finalize its much-anticipated Trans-Pacific Partnership, an 11-nation regional trade agreement that, if successful, will expand American exports and economic influence in Asia.

As we noted previously, the TPP is still facing many challenges as negotiations draw to a close. The Association of Southeast Asian Nations recently unveiled plans for the Regional Comprehensive Economic Partnership, which would be the world’s largest-ever regional trade agreement.

The partnership includes ASEAN’s 10 member states as well as Australia, China, Japan, India, South Korea and New Zealand. Its creation raises several questions for the future of the TPP – namely, can the US-led agreement thrive alongside Asian-organized, competing trading blocs, especially if those blocs include China and exclude the US?

Some believe that competing pro-China and pro-US treaties may escalate current economic tension in the region, rather than alleviating it. The potential conflict also presents an especially tricky situation for Australia, whom the US sees as playing a key role in nurturing American economic activity in Asia.

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Businesses, Politicians Clash Over US-South Korea Free Trade Agreement

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Since December, when President Barack Obama and South Korean President Lee Myung-bak announced that they made further progress on the US-South Korea Free Trade Agreement (KORUS-FTA), the agreement has been highly debated on its way to Congress. In order for the measure to take effect, both the Congress of the United States and the Congress of South Korea must ratify the agreement.

On one side, local and national business leaders are urging Congress to approve the agreement, citing the success of NAFTA and its effect on US exports and job creation. President Obama, at the time of his signing of KORUS-FTA, stated that deal would “boost US exports to 11 billion and support at least 70,000 jobs.”

Failing to act would hurt the US as well, proponents of the measure argue, as South Korea is in talks with Canada about a free trade agreement and has already inked one with the European Union. If approved, these agreements create a more attractive trading option for South Korean businesses than what the US has to offer, and thus inevitably decreasing the amount of US exports to South Korea.

korea-us-free-trade-agreementIf approved, the US will benefit from the gradual reduction of South Korea’s current tariffs of up to 40%, all the way down to zero in 95% of industries within three years, with most remaining tariffs being eliminated within ten years. This will obviously aid many trade industries by reducing the cost of trade and opening new opportunities, including the auto industry and the National Cattlemen’s Beef Association (NCBA), who, along with 60 other food and agricultural groups and companies, have sent a letter to Speaker of the House John Boehner (R-Ohio); House Democratic Leader Nancy Pelosi (D-Calif.); Senate Majority Leader Harry Reid (D-Nev.) and Senate Republican Leader Mitch McConnell (R-Ky.) in support of the recent agreement.

However, not all businesses and politicians support the agreement because they believe the agreement will actually hurt US businesses and create major job loss due to jobs going overseas. California, one of the US’s largest traders with Korea, lost 800,000 jobs due to NAFTA, according to the California Labor Federation, and would likely see further erosion of jobs with another free trade agreement.

California does not necessarily hold the trend for the rest of the US, as it shares the closest ties with South Korea with more than half of a million South Koreans living in the state, and thus is the most vulnerable economically.

Overall, free trade agreements will at the very least increase opportunities for US businesses to increase exports, and will likely save or create jobs as well. The free trade agreement is even more vital if the EU and Canada agreements get finalized, as US cannot afford to fall behind and lose export revenue to the Asian economic giant.

 

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No Free Trade Agreement for US, Taiwan

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The US has squashed a potential free trade agreement with Taiwan over disputes concerning US beef.

us-beef-exports-taiwan-trade-agreement
Image Courtesy: Lodick Family

Just after Taiwan has signed a landmark free trade agreement with China, David Shear, the State Department pointman on China-Taiwan ties, said the “The United States has no plans to begin talks with Taiwan about an FTA at this time.”

The US and Taiwan were previously negotiating a Trade and Investment Framework Agreement in 2007.

According to the AFP, Taiwan and other Asian countries have been hesitant to implement trade agreements with the US due to various agricultural trade disputes, including beef, pork, and poultry.

The countries imposed restrictions in late 2003 after mad cow disease was detected in an American herd. Some scientists believe humans can contract the brain-wasting illness by eating infected animals’ brains and spinal cords.

Taiwan agreed with the United States in October to let in more beef products but the island’s parliament reimposed restrictions three months later after a public outcry.

Read the complete article at Google News: AFP: US rules out Taiwan free trade deal

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Boeing Urges Progress Towards Trade Agreements

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According to today’s Financial Times, Boeing is urging Congress to pass languishing free trade agreements with Colombia and South Korea.

Jim McNerney, Chief Executive of Boeing, noted that the US economy is still “fragile” and said “We need to borrow less, save more, become more efficient and competitive and bring our exports back in line with our imports. Opening up and expanding new markets is paramount,” in his speech to the Chicago Council on Global Affairs.

The Financial Times states:Time's Up for Trade Agreements?

As chairman of President Barack Obama’s export council, Mr McNerney has been tasked with leading industry’s side of a campaign to double US exports within five years – an effort that the White House projects will create two million US jobs. Boeing is the world’s second-largest aircraft-maker and one of the US’s biggest exporting companies.

McNerney also added, “The Obama administration, in my view, is not moving fast enough. I would encourage them to move faster on … free trade agreements with Korea, Colombia and Panama.”

Although the US signed trade agreements with South Colombia, South Korea, and Panama in 2006 and 2007, Congress has failed to approve the agreements. Companies are looking to President Obama to get the ball rolling again to pass these agreements into effect.

Specifically, McNerney believes Korea and Colombia to be new markets where European corporations (Ahem, Airbus perhaps?) were able to export under a lower-tariff regime than US Companies.

Read more at: “Boeing urges faster action on trade deals” in the Financial Times.

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US & Singapore Review Free Trade Agreement

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On December 3rd, the US and Singapore got together to hold their annual free trade agreement review – the fifth such review since the  agreement was implemented in 2004.

Assistant United States Trade Representative Barbara Weisel led the U.S. delegation and Deputy Secretary (Trade) Koh Lin-Net of the Ministry of Trade and Industry led the Singaporean delegation.

US-Singapore Trade Agreement: Singapore Esplanade

Photo Courtesy Edwin.11

The annual review provides an opportunity for both sides to exchange opinions on trade topics such as agricultural and textile market access, intellectual property rights, telecommunications and government procurement, and other issues.

The delegations also  reviewed the past year’s activities under the Plan of Action for Environmental Cooperation, discussed additional opportunities for environmental cooperation and explored ways to intensify joint work on labor issues, including worker rights and human resources development.

The Office of the US Trade Representative states:

The two sides also discussed ongoing cooperative efforts and welcomed the continued robust growth in bilateral economic trade and investment since the FTA came into force in 2003.

Since the U.S.-Singapore FTA came into force, U.S. goods exports have increased 68 percent and Singapore is now the United States’ 16th largest goods trading partner, with goods exports totaling $28 billion in 2008. U.S. agricultural exports to Singapore totaled $485 million 2008.

Trade in services also remained strong over the past year, with U.S. exports of $9 billion to Singapore in 2008, up 12.5 percent from the previous year. In 2008, Singaporean investment in the United States increased by nearly 9 percent and U.S. investment in Singapore increased by 12 percent.

With the possibility of an upcoming TPP agreement, the potential for growth in Southeast Asia is enormous. US companies seeking to export to Singapore and other TPP partners should start preparing today. Taking advantage of the trade agreements already in place with TPP partners, such as US-Singapore, US-Chile, and US-Australia, can set a foundation and build experience for further expansion once the Trans-Pacific Partnership has been solidified.

In particular, the US-Singapore agreement may be the basis agreement for the TPP, especially considering its Plan of Action for Environmental Cooperation and labor rights considerations.

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The two sides also discussed ongoing cooperative efforts and welcomed the continued robust growth in bilateral economic trade and investment since the FTA came into force in 2003. Since the U.S.-Singapore FTA came into force, U.S. goods exports have increased 68 percent and Singapore is now the United States’ 16th largest goods trading partner, with goods exports totaling $28 billion in 2008. U.S. agricultural exports to Singapore totaled $485 million 2008. Trade in services also remained strong over the past year, with U.S. exports of $9 billion to Singapore in 2008, up 12.5 percent from the previous year. In 2008, Singaporean investment in the United States increased by nearly 9 percent and U.S. investment in Singapore increased by 12 percent.

The U.S.-Singapore FTA also serves as a foundation for broader cooperation between the two countries regionally and multilaterally. The United States is engaging closely with Singapore on the Trans-Pacific Strategic Economic Partnership (TPP), a high-standard agreement that will serve as a platform for Asia-Pacific economic integration in a way that reflects U.S. priorities and values. Singapore is a founding member of the TPP. The United States and Singapore also work together closely in the WTO, ASEAN and APEC.

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Obama Hopes to Pass KORUS Trade Agreement By 2010

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While visiting South Korea, President Obama announced his intention to pass the South Korea-US free trade agreement that is currently on hold, pending approval in Congress.

From the New York Times, on Thursday:

At a news conference in Seoul, South Korea, Mr. Obama and the president of South Korea, Lee Myung-bak, both declared their desire to renegotiate elements of the agreement and to have both countries ratify it as soon as possible.

“I am a strong believer that both countries can benefit from expanding our trade ties,” Mr. Obama said. “I have told President Lee and his team that I am committed to seeing the two countries work together to move this agreement forward.”

However, since Thursday it has become unclear whether the two nations will be able to renegotiate the terms of the agreement, as the South Korea foreign trade minister ruled out additional trade talks on Friday.

US Manufacturers oppose the agreement, saying it does too little to open the Korean market and they will face an influx of Korean competitors. Proponents counter that, with Korea’s new trade agreement with the EU, the US must approve this deal if it wants to remain competitive in both markets.

Read the complete article at: South Korea Trade Pact Is Revived by Obama

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NAFTA: US, Mexico at Odds over ‘Dolphin-Safe’ Tuna

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The US is seeking talks with Mexico to determine who should field their complaint over ‘dolphin-safe’ tuna. In March, Mexico filed a complaint with the WTO regarding US labeling rules.

The United States Trade Representative (USTR) believes that the issue should be resolved by a NAFTA panel rather than the WTO, as trade disputes involving conservation and environmental issues, the United States says NAFTA is the proper forum if the respondent requests it. This is the first such NAFTA venue challenge, the USTR said.

From Reuters:

Photo by naotakem

Photo by naotakem

The United States bars the “dolphin-safe” label on tuna caught by boats using purse seine nets that also snare dolphins — a technique used by Mexican vessels, the U.S. Trade Representative’s office said.

“We are enforcing the right that the United States, Canada and Mexico negotiated in the NAFTA,” USTR spokeswoman Debbie Mesloh said in a statement.

“This is an important right that has not previously been invoked by a NAFTA party, and defending our right under this clause preserves and strengthens the NAFTA dispute settlement regime.”

Read the complete article: U.S. requests talks with Mexico over tuna dispute

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