October 1st, 2010
By Bridget Hunter
Staff Writer, Department of State
Washington — “The U.S. trade and investment regimes are among the most open in the world,” the World Trade Organization (WTO) Secretariat reported September 29 in its 10th review of the trade policies and practices of the United States.
“Like most other WTO Members, the United States very largely resisted pressures to respond to the global economic recession by tightening restrictions on imports,” the Secretariat reported in its executive summary. “The restraint shown by the United States helped forestall a worldwide slide into protectionism.”
Because surveillance of national trade policies is fundamentally important to the work of the WTO, the organization has established a trade policy review mechanism under which all WTO members are examined periodically. The frequency of each country’s review varies according to its share of world trade. The previous review of U.S. trade policies took place in 2008.
Deputy U.S. Trade Representative (USTR) Michael Punke, introducing the report at a WTO meeting in Geneva, thanked the Secretariat for its efforts and its diligent fulfillment of “its role as objective observer and its duty to seek consistency” in trade reviews.
Punke, who serves as U.S. ambassador to the WTO, said the United States had answered more than 1,200 questions submitted by WTO members in preparation for the review, a response consistent with the United States’ commitment to openness.
“U.S. trade policy and the U.S. government’s trade policy priorities are no secret to this body or to the world,” he said. “The United States has been reporting U.S. trade policy priorities and activities to the American people for the past 55 years. … The Obama administration is committed to greater transparency in trade policy and we are using 21st-century technology to fulfill this commitment.”
The ambassador outlined some advantages U.S. trade policy brings to Americans, including the more than 10 million U.S. jobs — one-quarter of those in the manufacturing sector — supported by exports and the fact that exports account for $1 in every $10 of U.S. income. But he emphasized that those advantages are shared with, rather than achieved at the expense of, U.S. trading partners.
“As we all understand, trade need not be a zero-sum game, he said. “If we all open our markets and play by the rules, trade gains to one country come not at the expense of others, but in conjunction with the gains of others.”
IMPORTANCE OF OPENNESS, BALANCE
Punke recapped the key themes of U.S. trade policy:
- Openness. “The World Bank confirms that the United States is one of the most open economies in the world. IMF [International Monetary Fund] data also show that 76 countries have the United States as their first-, second- or third-largest export market.”
- Balance. “Sustainable economic growth implies a more balanced distribution of global demand than existed before the crisis. … Going forward, it is unlikely that the U.S. will resume its outsized share of world demand, which will require concomitant adjustment from the large current account surplus countries.”
- Commitment to a rules-based trading system. “The United States continues to regard the Doha negotiations [the current round of WTO negotiations, which began in November 2001] as a unique opportunity not only to solidify the foundations of our multilateral system, but to lay the basis for future prosperity around the world by expanding market access in a way that will benefit all countries — developed and developing alike.”
- Sound, comprehensive bilateral and regional agreements. “Last year, we pledged to seek paths forward on approving and putting into effect three pending FTAs [free-trade agreements], and to build on important existing agreements to better achieve our goals of creating more jobs and higher growth.”
President Obama has announced his intent to resolve outstanding issues with the United States-Korea FTA and submit it to Congress as soon as possible, Punke reminded his audience. He added that the president also is determined to move forward with the Colombia and Panama trade-promotion agreements as soon as possible.
“With regard to new initiatives, the United States has begun negotiations of a regional Asia-Pacific trade agreement, known as the Trans-Pacific Partnership (TPP) Agreement, with Australia, Brunei, Chile, New Zealand, Peru, Singapore and Vietnam,” Punke said. “With this initial group of like-minded countries, the United States is negotiating a high-standard, 21st-century regional agreement.”
The Trans-Pacific Partnership, created in 2006 by Singapore, New Zealand and Chile, aims to promote regionwide economic cooperation. Officials from the eight current TPP member economies are seeking to revise and refine the TPP to reflect 21st-century trade standards, which include ensuring worker rights and protecting the environment.
EXPANDING TRADE OPPORTUNITIES FOR POORER COUNTRIES
Another important element of U.S. trade policy highlighted by Punke is a commitment to expand trade opportunities to stimulate market-led growth in the world’s poorer countries and lift their national income levels.
The United States’ $1.05 million contribution to the WTO Global Trust Fund, announced by USTR Ron Kirk in July, is “only one part of our much larger commitment to trade capacity building assistance, to which the United States has contributed $12 billion since 1999,” Punke said, citing four U.S. preference programs — the Generalized system of Preferences, the African Growth and Opportunity Act, the Caribbean Basin Initiative and the Andean Trade Preference Act.
These programs allow eligible products from 131 beneficiary developing countries to enter the United States duty-free.
“Open markets promote growth, raise living standards and help individuals at all levels in all societies to realize dreams for themselves and for their families,” Punke concluded. “If we lose sight of this truth, if we settle for less, if we fail to respond to our individual and collective responsibilities as members of this institution — we will do ourselves and future generations a significant disservice.”