Advisory Committee on International Economic Policy (ACIEP)Summary of Discussions The meeting was open to the public; however, participants’ statements are not for attribution. Assistant Secretary of State for Economic, Energy and Business Affairs Daniel S. Sullivan and Committee Chair Michael Gadbaw of General Electric opened the meeting and welcomed the participants. Mr. Gadbaw announced new Vice Chairs Nancy Zucker Boswell, Managing Director of Transparency International, and Thea Lee, Policy Director of the AFL-CIO. Assistant Secretary Sullivan referenced the recent renewal of the Committee’s charter and welcomed the nearly 50 attendees, including the new ACIEP members. Assistant Secretary Sullivan encouraged the group to tackle a comprehensive agenda, including a focus on total economic engagement as a component of the State Department’s transformational diplomacy efforts. He also mentioned that Secretary of State Rice just delivered an important speech on the economic and political benefits of free trade to the Business Council; copies of the remarks were provided. Assistant Secretary Sullivan defined the Bureau’s Total Economic Engagement (TEE) initiative as a coherent, unified and multi-sector approach that draws on all economic resources, and not just official developmental assistance, to foster sustainable and empowering economic growth. Policies, Programs & Transformational Goals--Indonesia Bureau of East Asia and Pacific Affairs Deputy Assistant Secretary Eric John addressed State Department policy and efforts to support Indonesia’s own goals of bolstering growth, creating jobs and reducing poverty. USG foreign assistance to Indonesia continues to increase; for fiscal year 2008, USG has requested $185 million, an 18 percent increase from FY 2006. There are 16 ongoing public-private partnerships with $44 million in leveraged funds from the private sector working on education, health, and economic growth. The Millennium Challenge Corporation’s $55 million Threshold Program focuses on anti-corruption and immunization. The USG is working with the Government of Indonesia (GOI), and President of Indonesia Yudhoyono has implemented many reforms regarding debt reduction, monetary policy and economic growth. The GOI economic reform agenda lays out a program for stronger international competitiveness while addressing major domestic challenges. However, the GOI must still address development challenges of poverty and inadequate social services. Investment remains too low to create the jobs that will ultimately drive growth. A climate of good governance and pluralism will ensure that economic growth is broad-based, equitable and maintains openness. More engagement between USG and GOI economic officials will allow for a deeper dialogue on how we can work together and ensure a democratic and successful future for Indonesia. An ACIEP member from the research and academic community responded that we can be successful in Indonesia. President Yudhoyono is working to clean up the tax system. Corruption and infrastructure issues are problematic. Recent tragedies and natural disasters have had a negative effect. Investors ask colleagues and don’t just rely on press or government accounts for information. The size, significance and importance of Indonesia are not understood well in the U.S. Other members commented that there is a need to develop more programs with U.S. private sector organizations and institutions, a need to integrate expats, and increased utilization of the OECD. The USG has a huge opportunity to assist and reinforce positive trends. The Millennium Challenge Corporation is a huge opportunity. International Energy Policy Bureau of Economic, Energy and Business Affairs Deputy Assistant Secretary Paul Simons stressed that a sound energy future is one of the most critical challenges facing the world today. One of the most disconcerting developments of recent years has been the warping effect that energy issues have had on the geopolitical landscape. The President emphasized this in his State of the Union address and identified five key goals that will drive our policies at home and serve as the beginning of our consultations with allies abroad. The five pillars of our international energy policy are:
Further, we have launched a new partnership with the Brazilian Government in the area of biofuels. This agreement will transform the way we work together to promote a critical alternative energy source, deepening research and investment, helping developing countries in our hemisphere and beyond to fuel their growth, and working to enable more countries to supply energy for domestic production and consumption. The USG is also engaged in Caspian Energy Diplomacy and bringing China and India into more multi-national energy discussions. An ACIEP member from the energy sector inquired about how to adjust to countries that change contracts/do not adhere to contract sanctity and have no transparency in business practices. Problems exist with state-owned oil companies. Others opined that U.S. energy and trade policy need to be aligned. Need solutions to climate change. Public-Private Partnerships and Capacity Building Capacity building is an integral part of the international economic agenda. The Business Coalition for Capacity Building (BCCB) promotes capacity building efforts in public policy, economic development, and rule of law. Attention must be paid to physical and intellectual capacity building. BCCB is active in emerging markets. BCCB member ExxonMobil launched an Educating Women and Girls initiative with grants to governments and NGOs. USG supports the symbiotic relationship between capacity building, corporate social responsibility and total economic engagement agenda to advance transformational diplomacy. BCCB mentioned that the Secretary of State’s Award for Corporate Excellence (ACE) is very beneficial and critical steps come through public-private partnerships. An ACIEP member from the consulting community commented on the importance of exposing others to the richness and best practice models of doing business. Businesses look to comparative advantage and capacity building and public-private partnerships. Also, there is value in having a best practices connection with NGOs. Discussion about whether public-private partnerships can address quality control and supply chain management. Subcommittee Update and Proposal for Strategic Regions Subcommittee Subcommittee on Economic Sanctions Subcommittee on Strategic Regions Closing In closing, Chair Michael Gadbaw and Assistant Secretary Sullivan thanked the members for their participation and requested suggestions for topics to be discussed at future Committee meetings. |
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