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Trade Is The Rage In Washington
by William New
Talk of the U.S. trade agenda is reaching a fever pitch this week as President Bush prepares to deliver his agenda to Congress in what may be his call for presidential trade negotiating authority, or trade promotion authority (TPA), as he refers to it.
Congress and administration officials are popping up all over Washington to give their views on shaping the agenda. Little direct mention of high-tech issues has emerged at this stage, but the eventual outcome of the debate will have a significant impact on the industry's dealings abroad.
U.S. Trade Representative Robert Zoellick has circulated on the Hill a draft outline of the trade agenda, but it is being very tightly held, sources said. In public appearances this week, Zoellick continued his focus on negotiating a Free Trade Area of the Americas (FTAA), due to be completed in January 2005. The next round of talks begins this week en route to the next ministerial in about 18 months.
Zoellick told a Council of the Americas conference in Washington, D.C., and the House Ways and Means Trade Subcommittee this week that the United States is falling behind its competitor nations, he warned. "Of the 130 free trade agreements in force globally, the United States is a party to only two," Zoellick said. Those are the North American Free Trade Agreement and an agreement with Israel.
This echoed remarks by President Bush to the Council of the Americas on Monday, in which he said the United States has to be included in free trade agreements because it is "the world's preeminent inventor of new technology and the world's biggest investor."
He also said the U.S.-Chile bilateral agreement being negotiated will "send a signal to the nations of Latin America and the rest of the world: The United States will reward good performers." The United States will consider other proposals for bilateral trade agreements as well, he said.
While listing trade's benefits to a country that embraces it, Zoellick mentioned that trade improves education because a stronger economy "demands literacy, skilled labor and expertise in accounting, engineering and technology."
Zoellick identified Brazil as key to the hemisphere's opening to trade. But he also put the onus on the U.S. Congress to give the president TPA, which he called the administration's top legislative trade priority this year. In speaking to the trade subcommittee, he reached out to Democrats who favor labor and environmental standards in trade agreements by nudging the issue forward with several measures. But he stopped well short of agreeing to try to include those in the agreements themselves.
At Tuesday's hearing, Frank Vargo, vice president at the National Association of Manufacturers, called the FTAA the group's top trade policy priority.
The Democrats' View
At Tuesday's hearing, Rep. Sander Levin, D-Mich., ranking member of the trade subcommittee, called for progress on the U.S. trade agenda. He said both sides of the trade debate should break out of old ruts and reframe the issues involved. The agenda should include a discussion of how to handle labor and environmental standards in trade agreements, he said, and those who raise these issues should not be mistaken for protectionists.
This counters a comment by Bush on Monday, in which he said "we've allowed a new kind of protectionism to appear in this country." Bush then referred to labor, environment and the poor.
On congressional granting of presidential trade negotiating authority, Levin said there are three components to this "significant 'transfer of power.'" Congress granted the authority in 1974 and 1988 and it expired in 1994. The law in those cases contained negotiating objectives and legal mandates, mechanisms for congressional involvement and public input to the negotiating process, and a commitment to an "up or down" vote on the final package, he noted.
Levin said the way forward on the negotiating authority is to begin discussing these components in detail. This goes beyond the message of the administration so far this week.
Rep. Jennifer Dunn, R-Wash., a pro-free trader, told the Council of the Americas that Bush would send his trade agenda to Congress by Wednesday. She said Congress will vote on negotiating authority "in either June or July" depending on the vote for China's annual normal trade relations status.
AOL Time Warner Looks South
Steve Case, AOL Time Warner chairman, on Monday said the number of Latin American online users is expected to triple over the next three years to more than 42 million. E-commerce revenues in Latin America should increase from $1.5 billion today to $10 billion by 2003. His company is working with governments and businesses in the region to open markets, he said.
IDB Holds Info Tech Seminar
The Inter-American Development Bank is holding a business seminar Friday on projects to work with governments to develop all aspects of IT in Latin America and the Caribbean. Funding for 2001-2002 amounts to $4.4 billion.
Barriers To Trade Remain, WTO Says
A new WTO study on remaining market access barriers among member countries since the Uruguay Round of negotiations showed the Geneva body has "plenty of unfinished business," according to WTO Director-General Mike Moore. For instance, it found that among the 42 developed and developing countries surveyed, that average level of bound tariffs -- the limit they can rise to -- on industrial products ranges from about 2 percent to 59 percent. The National Foreign Trade Council applauded the report.
The study also found that 47 WTO members and five observer countries participate in the Information Technology Agreement that cuts tariffs on IT products. Although that is a small portion of the 141 member countries, the signers account for 93 percent of world trade in IT products.
OECD Communications Outlook 2001 Released
The Organization for Economic Cooperation and Development has released a report showing that in OECD countries the Internet, e-commerce and demand for broadband access at lower prices are the "major agents of change in recent telecom policy," and yet liberalization of telecom markets remains slow.
IFC Invests In India Telecom
The International Finance Corporation plans to invest approximately $100 million in telecommunication ventures in India over the next 12 months, India's Financial Express reported. The World Bank branch is well into discussions with telecom companies and likely will conclude a deal in three to four months. The investment will target mobile and basic telephony, an IFC officer said.
Russia To Put Government Online
The Russian government has announced it will put itself online beginning 2004 and ending in 2010, according to the Moscow Times. The effort is part of the e-Russia program to develop e-commerce and the Internet in the country.
U.S. Moving Too Fast On Defense Technology
The head of the Canadian Forces, Gen. Maurice Baril, said recently that he has told the United States to slow down its rapid upgrades in military technology. The Ottawa Citizen reported that he said smaller allies such as Canada have difficulty keeping up.
Fox To Be Guest At First State Dinner
While Canada is the United States' top trading partner, Mexican President Vicente Fox has been invited to be the guest at the first state dinner of the Bush administration, from September 5-7, the White House announced.
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