Remarks by Ambassador Michael Froman at the Washington Council on International Trade (WCIT)
August 12, 2014
*As Prepared for Delivery*
“Thank you, Rick, for that kind introduction. And thank you for all the work that the members of the Washington Council on International Trade (WCIT) are doing to promote trade and grow Washington’s economy. WCIT has been a true friend to USTR, having hosted us several times over the last few years, and we greatly appreciate your advocacy in support of Ex-Im reauthorization, TPA, TPP, T-TIP, and TiSA.
“While preparing these remarks, I came across some promotional material from the Seattle Chamber of Commerce. It read: ‘Her harbor is perfect, climate superb…people most progressive, commerce growing, manufactures flourishing…Seattle believes in expansion, and it practices what it believes. It is a city expanding in area, in population, in wealth, in influence....with the opening of Asia to the commerce of the world…Seattle is rapidly becoming great.’
“Sounds pretty accurate, but what’s really remarkable is that this was written more than one-hundred years ago, at the beginning of the 20th century.
“The author was thought to be Erastus Brainerd, who as secretary of the Seattle Chamber of Commerce, led the effort to promote Seattle’s status as a regional trading center. He might have been exaggerating then, but no exaggeration is needed now to highlight how trade fuels Seattle’s economy, nor to appreciate this city’s importance to the greater American economy. From the opening of the Port of Seattle in 1911, to strategic investments in that port during the 1960’s, to the tech boom of the 1990’s, trade has always been critical to Seattle’s rise.
“Last year, Washington exported a record $82 billion in goods, making it the nation’s fourth top state in terms of total exports. This state’s workers and businesses are a leading reason why the United States exported a record-setting $2.3 trillion in goods and services last year. Nationwide, these exports supported more than 11 million jobs, 1.6 million new jobs over the last five years, jobs that pay on average 13-18% more than non-export supported jobs.
“These trends might not come as a surprise, given Washington’s strong ties with a long list of global industry leaders like Amazon, Boeing, and Microsoft. But small businesses have played an equally critical role in Washington’s record-setting export performances. In fact, of the more than 12,000 companies that exported from Washington in 2012, 90% were businesses with fewer than 500 employees. These small businesses generated nearly one-quarter of Washington’s total exports of merchandise in 2012.
“And as impressive as these statistics are, they don’t begin to capture the legacy of innovation driven by the workers and businesses behind Seattle’s success.
“There are small businesses like Measurement Technology Northwest, which develops precision measurement instruments and sells those systems to customers in more than 20 countries around the world.
“There’s AeroGo, whose heavy transport equipment is made here and bought by customers in the European Union, China, Spain, and Thailand.
“There’s Cascade Designs, whose products—from the only snowshoes made in the USA to water purification equipment—are sold to over 40 countries. I’m looking forward to visiting them later today.
“These are just three of the 300,000 businesses that export. For each of those stories, there are literally 100,000 more stories of firms demonstrating how trade can create jobs and drive growth, and the truth is, we’ve only scratched the surface of trade’s potential. 95% of the world’s consumers and 80% of the world’s purchasing power lies outside the United States, 98% of U.S. exporters are small businesses, but only 1% of U.S. businesses currently export – which means that there are enormous, untapped opportunities for further growth.
“Through President Obama’s trade agenda, we’re working on a number of fronts to unlock opportunity for more American workers, farmers, ranchers and businesses of all sizes.
“To begin with, we’re negotiating an ambitious set of trade agreements to open markets to U.S. exports. The first of these next-generation agreements is the Trans-Pacific Partnership, or TPP, which the United States is negotiating with 11 countries in Latin America and the Asia Pacific. When concluded, this agreement will improve market access for U.S. businesses in the world’s fastest-growing region and a group of countries that represents 40% of the global economy.
“TPP will cover three of Washington’s top five markets--Japan, Mexico, and Canada, which collectively accounted for nearly a quarter of Washington’s merchandise exports last year. And according to a study by the Peterson Institute for International Economics, TPP could generate an additional $123.5 billion in U.S. exports annually by 2025.
“Through TPP, we are also leveling the playing field for American workers and businesses, by raising labor and environmental standards. We’re doing this not only because it’s the right thing to do, but also because we know that when global economic competition is fair, the world’s most productive workers and firms—American workers and firms—win.
“In addition to leveling the playing field, our TPP negotiations are also breaking new ground. For example, we’re taking on new issues affecting global trade, like ensuring that when state-owned enterprises compete against our private firms, they do so on a commercial basis. We are also working to ensure that the Internet remains open and free and that data flows unencumbered from country to country. By being the first to tackle these issues, we can establish standards for the Asia-Pacific region and potentially more broadly—which reflect American interests and values.
“And as we unlock opportunities for American businesses in the Asia Pacific, we are working simultaneously to deepen our economic ties across the Atlantic. The Transatlantic Trade and Investment Partnership, or T-TIP, will bolster what is already the world’s largest trade relationship by eliminating tariffs and reducing non-tariffs barriers to trade with the European Union. T-TIP will also focus on bridging the divergences between our regulatory and standards regimes, making it easier for U.S. businesses to export to our largest market while maintaining our high levels of health, safety, and environmental protection.
“Alongside TPP and T-TIP, we’re working to expand trade in services, in information technology products, and in environmental goods. In our bilateral efforts with various countries, we’re addressing a range of unwarranted barriers to U.S. exports; for example, last year, we resolved nearly 200 trade-related export barriers to U.S. agricultural exports alone. And when it comes to enforcing existing agreements, this Administration’s track record has no rival. Since 2009, we have brought 18 disputes in the WTO and have won every one decided so far.
“I could go on, but to avoid losing the forest for the trees, let’s take a step back and consider the big picture. When we’re done with TPP and T-TIP, the United States will have free trade with almost two-thirds of the global economy. When you combine that with all of the other advantages we have here—our educated workforce, innovative culture, rule of law, and abundant and affordable energy supply, it makes our country the world’s production platform of choice. Every week we hear of new investments in America driven by businesses that want to make things, grow things in the United States and ship them all over the world. Our trade policy is a key component of our efforts to drive investment and rejuvenate manufacturing, focused on growing jobs in the United States.
“We’re making progress toward that vision, and these are exciting times. In Seattle, and in cities and towns around America, we have seen how trade creates better jobs, drives growth, and strengthens the middle class. Outside our borders, the rise of a global middle class is expanding the market for U.S. exports and creating new opportunities for American workers, farmers, ranchers, and businesses.
“We have a roadmap for unlocking those opportunities, the President’s trade agenda, but as Erastus Brainerd knew more than a hundred years ago, it takes much more than a map. That’s why in addition to writing those advertisements, Brainerd enlisted the help of local businessmen and Seattle’s recent arrivals. He petitioned government officials. He wrote letters to newspapers around the country. He knew that Seattle’s economic future depended on action. Put simply, Brainerd knew that the world does not stand still.
“That has never been more true than today. We have a choice: We can help set the rules of the road, consistent with our interests and our values, or we can face a world in which the rules are set by others who do not put the same value on labor and environmental standards, on protecting intellectual property rights, on putting disciplines on state-owned enterprises, on maintaining a free and open Internet. Others are not standing on the sidelines, neither can we.
“Seattle deserves better, which is why the efforts of organizations like WCIT, the Seattle Metropolitan Chamber of Commerce, and others are so critical. I hope you’ll carry the torch that Brainerd once held and join me in working to ensure that this city’s economy, and our nation’s economy, seizes the opportunity that lies ahead.
“Thank you, and I look forward to taking your questions.”