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U.S. – China Trade, Investment Meeting Scheduled

U.S. – China Trade, Investment Meeting Scheduled

Washington, D.C. – The US and China are scheduled to hold their annual round of discussions on commerce and trade next week in Chicago.

The 25th Session of the China-U.S. Joint Commission on Commerce and Trade (JCCT), slated for December 16-18, will include a roundtable discussion on bilateral investment; a cooperative travel and tourism program; and a discussion on “developing a shared vision of economic leadership.”

According to the Office of the U.S. Trade Representative, for the first time, the JCCT schedule includes a full day of events designed to facilitate private sector engagement with officials from the U.S. and Chinese governments with the goal of “expanding the scope of the JCCT with engagement between businesses from both countries.”

U.S. Secretary of Commerce Penny Pritzker, U.S. Trade Representative Michael Froman, and Chinese Vice Premier Wang Yang will co-chair the high-level plenary talks. U.S. Secretary of Agriculture Tom Vilsack will also participate.

Sixteen JCCT Working Groups meet throughout the year to address topics such as intellectual property rights, agriculture, pharmaceuticals and medical devices, information technology, and travel and tourism.

Established in 1983, the JCCT is the primary forum for addressing bilateral trade and investment issues and promoting commercial opportunities between the United States and China.

Private sector groups involved in the event include the U.S. Chamber of Commerce; The Paulson Institute; World Business Chicago; the U.S. Travel Association; and the Chicago Council on Global Affairs.


‘Significant Progress’ Seen in Recent TPP Talks

Washington, DC – The recent negotiations between the 12 Pacific Rim nations crafting the Trans-Pacific Partnership (TPP) trade agreement “made significant progress” on proposed rules for state-owned enterprises despite differences over tariffs remaining one of the obstacles to a final deal.

Spanning ten days in Hanoi, the talks “spent successive rounds trying to narrow the gaps,” said US delegation leader, Barbara Weisel, US Trade Representative for Southeast Asia and the Pacific.

The TPP would create a free-trade zone from Australia to Peru with $28 trillion in economic output, or 39 percent of the global total. The deal is seen as a major component of the White House’s effort to bolster boost US exports.

The pact, would be the biggest trade deal in US history. The TPP “goes beyond typical trade agreements that focus on reducing tariffs, and highlights issues such as stricter safeguards for patents and copyrights and leveling the playing field for companies that compete with government-backed businesses,” said Weisel.

Responding to the status of the TPP talks, US Chamber of Commerce Executive Vice President and Head of International Affairs Myron Brilliant said, “Now is the time to seize upon the extensive economic benefits that the TPP offers every participating country.”

All parties to the negotiations, he said following a recent USCOC event, “must show the political courage required to make the hard decisions needed to conclude the TPP negotiations soon, as this will not get any easier with time.”

Commenting on what he called the “importance of crafting a high-standard, comprehensive trade agreement,” Brilliant said, “If Japan, the United States, or any negotiating partner cannot meet the high standards of the TPP on market access or rules, then the overall ambition of the agreement will be lowered to the detriment of every nation’s interests. We should all guard against that outcome.”

The proposed TPP’s geopolitical importance, he concluded, “is unmistakable. While we must not subordinate commercial priorities to foreign policy goals, the TPP’s geostrategic importance should strengthen our resolve to achieve an ambitious, comprehensive agreement.”

The countries covered by the trade pact are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam, and the US.

China, which has been excluded from the TPP, is separately moving on trade talks with countries such as South Korea, Japan and Australia.



USCOC, NAM Oppose More Sanctions on Russia

Washington, DC – In a major policy shift, the US Chamber of Commerce (USCOC)  and National Association of Manufacturers (NAM), two of the largest business groups in the US, have publicly come out in opposition to the sanctions imposed by the White House on Russia following that country’s February military incursion into neighboring Ukraine.

The groups ran newspaper advertisements last week in several publications including the New York Times, Wall Street Journal and Washington Post, asserting that “the only effect” of additional sanctions would be “to bar US companies from foreign markets and cede business opportunities to firms from other countries.”

Both groups had, previously, confined their opposition to the sanctions in a series of private meetings with Obama Administration officials.

The ads ran under the headline, “America’s Interests Are at Stake in Russia and Ukraine“.

Its text read: “With escalating global tensions, some US policymakers are considering a course of sanctions that history shows hurts American interests. We are concerned about actions that would harm American manufacturers and cost American jobs. The most effective long-term solution to increase Americas global influence is to strengthen our ability to provide goods and services to the world through pro-trade policies and multilateral diplomacy.”

Jay Timmons, NAM president and CEO, wrote, “History shows that unilateral sanctions don’t work. President Reagan recognized this reality three decades ago when he lifted the ineffective grin embargo on the Soviet Union.”

The only effect of such sanctions, Timmons said, “is to bar US companies from foreign markets and cede business opportunities to firms from other countries. It’s time to put American jobs and growth first.”

US workers and industries, wrote USCOC President and CEO, Thomas J. Donohue, “pay the cost of unilateral economic sanctions that have little hope of increasing the United States ability to achieve its foreign policy goals.”

Both the US and European Union have imposed penalties against Russian companies, as well Ukrainian supporters of the separatists with Russian President Vladimir Putin threatening to retaliate against US and European companies if broader sanctions are imposed.

US officials have said that the current sanctions now in place have fueled a record $60 billion capital outflow in the first quarter of this year, as well as losses in Russia’s stock market and currency.

The Ukrainian government, the US and its European Union allies say Russia is fueling the conflict by providing manpower and weapons including tanks and anti-aircraft missiles to separatist rebels in Ukraine.




Export-Import Bank Reauthorization Endangered

Washington, DC – The Export-Import Bank of the US (EXIM) is in danger of extinction as incoming House Majority Leader Kevin McCarthy (R-California) has said that he would not support reauthorizing its charter once it expires in September.

McCarthy, speaking on a Sunday news program, said he felt EXIM’s role in guaranteeing loans made to help US companies export their goods “is something that the private sector can be able to do.”

His comments echoed critics of the bank who say the bank creates too much interference in private markets.

According to McCarthy, “One of the biggest problems with government is they go and take hard-earned money so others do things the private sector can do. That’s what the EXIM does.”

If the bank’s charter isn’t reauthorized, it could continue servicing the loans it already has made and backed, but it wouldn’t be able to authorize new loans.

The bank, created 80 years ago, borrows money from the Treasury Department and pays interest on the funds to the Treasury. It then lends that money out and charges a higher interest rate, plus a fee, that generate its revenue.

EXIM has been technically self- sustaining since fiscal 2008, though Congress provides funding for the bank’s Office of Inspector General and sets the bank’s lending limit.

In 2012, lawmakers raised the bank’s lending limit to $140 billion from $100 billion. In fiscal 2013, the bank authorized $27 billion to support an estimated $37.4 billion in US export sales.

EXIM also sent $1.06 billion to the US Treasury, money it earned from interest and fees it charged its customers.

The White House has said that EXIM is critical to helping sustain US exports. Close to 60 other countries have agencies to help finance exports, and supporters of the bank have said that ending the Export-Import Bank would put U.S. companies at a competitive disadvantage.

A number of organizations including the National Association of Manufacturers, the Business Roundtable and the US Chamber of Commerce, as well as a number of large- and small-sized US exporters that have been assisted by the bank are joining forces to push for its reauthorization.


A US Trade Mission to Cuba! What Would Che Say?

WASHINGTON, DC – The US Chamber of Commerce (USCOC) has just wrapped up a week-long trade mission to Cuba to get a first-hand look at changes in Cuba’s economic policies, develop a better understanding of the country’s current business environment and the state of its private sector.

The mission was led by USCOC President and CEO Thomas J. Donohue, who was joined by Steve Van Andel, chairman of the U.S. Chamber’s Board of Directors and of Alticor Corporation, and Marcel Smits, CFO of the Cargill Corporation and other mission members for meetings with a number of entrepreneurs, private cooperatives, government officials, academics, and religious leaders.

The mission’s findings, he said, will be reported “to lawmakers, our members, and the American business community.”

The USCOC has long advocated normalizing US-Cuba relations, including a lifting of Washington’s 50-year embargo, pointing to Cuban President Raul Castro’s efforts to jump-start the country’s stagnant economy with a series of unprecedented economic reforms.

Despite the fact that the island opened to limited foreign capital in 1995, Cuba has actually seen a significant drop in foreign investment and sluggish economic growth over the past decade. The economy grew by only 2.7 percent last year, far below the government’s goal of 7 percent.

While almost half-a-million Cubans have obtained licenses to operate small, private businesses, Cuba’s economy is still seen as highly centralized, inefficient and over regulated.

In March, the country’s National Assembly responded by unanimously approved what Castro called a “modernization bill” aimed at radically liberalizing the Communist-run island’s foreign investment rules.

Among other provisions, the new investment law slashes taxes on profits from 30 percent to 15 percent; gives new investors eight years of exemption from paying taxes; speeds-up the approval process for foreign investors; provides added legal protection for foreign investors; and cuts taxes on investments in most sectors to 15 percent, although special conditions will be set for investment in natural resources.

Before the trade mission left for Havana, Donahue told the media that, “We want to learn more about these reforms, determine if they have brought about real and lasting changes, and find ways to encourage Cuba’s budding private sector.”

The trade mission, the first to Cuba by the USCOC in 15 years, drew sharp criticism from the Cuban community in the US, which accuses the Castro regime of continuing to persecute political opponents in violation of international law.

Senator Robert Menendez (D-New Jersey), chairman of the senate Foreign Relations Committee, said in a press interview that political opponents continued to be arrested “without justification” in Cuba and that “such conditions hardly seem an attractive opportunity for any responsible business leader.”

Havana, he added, “unjustifiably jails foreign business leaders and breaks international labor standards” and that he “questions the merits of engaging a government controlling almost all the country’s economic activity.”