This Thursday is the WCIT Summer Luncheon, featuring Deputy United States Trade Representative Demetrios Marantis. This is a pretty big deal for Washington’s international business community: the chance to hear directly from the person in the Obama Administration responsible for U.S.-Asia trade policy. Since a large majority of our state’s goods are exported to and imported from the Asia-Pacific region, Asia trade policy is a pretty important topic for a lot of people.
There are a ton of people attending the event, and we’re all excited to hear Ambassador Marantis’ insights into what the future holds for our Asia trade opportunities, particularly in terms of the Trans-Pacific Partnership negotiations and U.S.-China policy. We’ll find out soon enough but, just for fun, here are three guesses as to what he might say as part of his remarks:
1) “The TPP is on track…and growing!”: At the beginning of July, the nine countries engaged in the Trans-Pacific Partnership negotiations met in San Diego, and had a very successful session. “Significant progress” was made on a number of key issues, like rules of origin, investment and financial services; plus, Mexico and Canada were invited to join the TPP, which makes the economic power represented by the agreement significantly larger. As we’ve always said, the best part about TPP is not who the original negotiating partners were but the potential to create a framework that others would want to join into. With another TPP negotiating session planned for September (in Virginia), I expect Ambassador Marantis to share some very optimistic statements about the potential to get TPP done in a reasonable timeframe, and for USTR to increase its outreach to Congress in preparation for an eventual vote.
2) “Our relationship with China needs improvement, but there are positive signs”: It’s hard to see these days, especially because of the charged presidential campaign rhetoric, but the U.S.-China relationship is actually very productive, especially for Washington companies. It seems like almost every day you see a new article in the paper about some Washington company expanding its China business, either through increased exports or through an expanded supply chain relationship. Yet, there are clearly some very real issues with China, particularly in the realm of market access and intellectual property protection. Everyone across the political spectrum believes this, but there are very diverse views on how to achieve it: Bilateral negotiations? WTO cases? Increased tariffs on Chinese imports related to their currency valuation? Sitting around and watching as China eventually improves its own trade policies? Certainly, in the last year, there has been a lot of action by USTR in terms of bringing cases to the WTO, and some victories have come out of that process. But real, sustainable improvements have to come from positive, productive engagement and we’re seeing that as well. I think Ambassador Marantis will highlight some of those discussions in his remarks.
3) “The United States is a Pacific nation, and Asia trade is our path to economic prosperity”: It’s not going to be surprising to hear a US Trade Representative talk about the importance of trade as an economic driver, but it’s actually true. Since the end of the recession, exports have accounted for 43% of economic growth, one of the strongest showings in any recent economic recovery. And while some of this is due to a weak dollar, much of it is due to rising demand for innovative U.S. goods and services in emerging markets (both in Asia, as well as throughout South America, the Middle East and Africa). Despite China’s market access issues, Washington’s exports to China have increased from $3 billion to $11 billion in the last decade alone. Where else is our export growth going to come from…the EU? Nope, at least not soon. With a housing and construction market still sorting itself out, and domestic consumers still digging themselves out of debt, trade with Asia is the best opportunity we have to create jobs and long-term economic growth.
Those of you who attend this Thursday should bring this as a test…if I get all three right, I win a prize. Or, at the very least, dessert. Looking forward to seeing some of you at the event!
