Advisory Committee on International Economic PolicySummary 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 Chairman Michael Gadbaw of General Electric opened the meeting of the Advisory Committee on International Economic Policy (ACIEP) and welcomed the participants. Under Secretary for Economic, Energy and Agricultural Affairs Reuben Jeffery III also attended the meeting and offered closing remarks. Assistant Secretary Sullivan announced the new ACIEP chair, welcomed the new members to the committee, and thanked the membership for their continued support and dedication to the ACIEP. Theodore W. Kassinger of O’Melveny & Myers LLP has accepted chairmanship of the ACIEP. Mike Gadbaw, who has led the committee for more than ten years, announced his upcoming retirement from GE and the committee. Thea Lee of the AFL-CIO and Nancy Zucker Boswell of Transparency International will remain as co-chairs. A/S Sullivan read a personal message to the committee membership from incoming Chairman Ted Kassinger. Kassinger expressed his eagerness to engage the membership on a number of policy issues in 2008 and regretted that he was not able to attend the December 18 meeting. Policies, Programs & Transformational Goals---Free Trade Agreements with Latin American countries Principal Deputy Assistant Secretary for the Bureau of Western Hemisphere Affairs Craig Kelly addressed the membership about the pending free trade agreements with two Latin American countries. PDAS Kelly told the membership there is a strong support in Latin America for the pending free trade agreements with Colombia and Panama. The agreements would bring increased stability to the region, alleviate poverty, and open the doors to other regional trade opportunities. Chile was cited as an example of a Latin American country that has prospered since implementation of a trade agreement with the United States. In addition to the FTA with the U.S., Chile now has 56 agreements with other countries. Its poverty has decreased by 13.7%. Social mobility has increased, and access to education for people of all classes, especially women, has improved tremendously. Peru recently secured a free trade agreement with the U.S. and is pushing for agreements with neighboring countries in the region. Peru wants more partners in the region like Colombia and Panama. Labor and environment issues have been a concern of the U.S., which are addressed by state-of-the-art labor and environmental provisions in the agreements. Assistant Secretary Sullivan and PDAS Kelly traveled to Chile, El Salvador, Mexico, and Brazil in early December. A/S Sullivan asked his Latin American counterparts how the government and private sector can help to ensure the benefits of the agreements are widely shared and include small businesses and farmers. Latin Americans expressed a desire for increased access to capital and English language training, and mentioned concerns about Sanitary and Phytosanity Standard (SPS) regulations and labor issues to be addressed. According to a senior Chilean official, passing the Colombia Free Trade Agreement would be the best way to enhance U.S. relations with Chile. An ACIEP member representing an NGO agreed that this is a transitional moment in trade and stressed the importance of fairly distributing the benefits of trade agreements to small businesses and farmers, not only to multi-national enterprises. The key concerns of a free trade agreement are the set of rules embodied by the agreement such as investment and procurement opportunities, labor and human rights, and the overall economic impact on the country. Many countries perceive free trade agreements as a tool of American multi-national corporations. Trade has become a political debate about job loss, shift of bargaining power where companies and workers are pitted against each other, capital mobility, and the wrong kind of trade and globalization. Free trade plays a role in our diplomatic relations with other countries, but some countries receive increased trade flows with mixed reactions as the benefits are not seen as widely shared. Another ACIEP member responded for the manufacturing sector. Free trade agreements have been seen as a real economic benefit for the industry. Export growth drives the economy and the value of the dollar. Free trade agreements also help with immigration concerns, as trade encourages workers to take advantage of opportunities in their country and revive their economy. The manufacturing sector lost 3 million jobs between 2001-2003, but this was during a time when the trade deficit was going down. Most of the U.S. trade deficit is with countries with which we do not have trade agreements. Trade deficits and job losses are not due to free trade agreements. Free trade agreements can be seen as an opportunity to provide countries struggling with improving democracy, addressing civil conflict, and halting drug trafficking with new opportunities and alternative means to resolution. Other ACIEP members responded with comments on perceptions related to pending free trade agreements, with some concerned the U.S. is sending the message that trade “heals all ills.” A large number of jobs are created, but in some cases companies are moving from industrialized countries to lesser developed ones. To address this, some ACIEP members support U.S. promotion of progressive social policies in countries entering into trade agreements with the United States. Subcommittee Updates John Sullivan of the Center for International Private Enterprise (CIPE) delivered the Subcommittee on Strategic Regions’ report on behalf of Subcommittee Chair General Daniel Christman. Sullivan reported that the website of the subcommittee has been uploaded to the Economic Bureau’s homepage at www.state.gov/e/eeb/tpp/eesr. The Strategic Regions Subcommittee most recently met on October 30. Economic Sanctions Subcommittee Chair William Reinsch reported that the subcommittee’s letter to Secretary Rice on economic sanctions has been posted on the Advisory Committee on International Economic Policy’s webpage at www.state.gov/e/eeb/adcom. The Economic Sanctions Subcommittee has requested a briefing with Bureau of Economic, Energy and Business Affairs Deputy Assistant Secretary Douglas Hengel to discuss sanctions policy. The subcommittee plans to have meetings in January on state legislation, the relationship of parent companies and overseas subsidiaries, and the extent to which U.S. law can be enforced. A report will be given at the next ACIEP meeting. Future ACIEP Agenda Items ACIEP Committee members offered suggested topics for meetings in 2008. Closing Under Secretary for Economic, Energy, and Agricultural Affairs Reuben Jeffery III gave closing remarks and offered words of farewell to outgoing Chairman Mike Gadbaw. Under Secretary Jeffery thanked Mike Gadbaw for his leadership and commitment to the ACIEP over the years and welcomed Ted Kassinger’s willingness to continue to serve on the committee in the capacity as chairman. Mike Gadbaw concluded the meeting by commenting on the ACIEP’s long-running history and ability to adapt to changes in Administration and leadership. He remarked that ACIEP institutionalizes economic and foreign policy debates, highlights global policy from a broad range of constituencies, and provides a valuable vehicle to hear competing views. ACIEP has followed certain principles: the right to speak and be listened to, and transparency as a source of strength. Most ACIEP meetings have been open to the public and meeting summaries are posted to the Economic Bureau’s webpage to make it clear that deliberations are open and accessible. Engagement is one of the best ways to resolve differences. ACIEP meetings serve the invaluable purpose of helping to look at global issues through the eyes of others and learning from government, NGOs, academics, and business organizations how to address critical international issues and events. |
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