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Remarks by Ambassador Kirk to the Toronto Board of Trade

Remarks by Ambassador Ron Kirk

July 23, 2010
Toronto Board of Trade

Toronto, Canada

*As Prepared for Delivery*

“It’s especially nice to join all of you here at Toronto Board of Trade, one of the preeminent platforms for dialogue among prominent and influential economic leaders from both Canada and the United States.

“This is a great opportunity to exchange information and ideas among key stakeholders and continue to build the bilateral relationship – not just government to government, but in all dimensions.

“Together we – Canada and the United States – are setting a strong example for the world to follow. We enhance economic opportunities through trade with more than $1.4 billion crossing our borders every day. I know that many of you here are key drivers of that record trade volume.

“And over the years, Canadian and American companies and workers have proven that strong allies can be friendly competitors at the same time.

“Even before our countries came into being our ancestors traveled up and down the St. Lawrence River and across the Great Lakes in pursuit of trade, commerce, and economic opportunity.

“Over the years these relationships formed an unbreakable bond between our two countries. And as we approach the anniversary of the 9/11 Attacks this September, Americans are grateful for our Canadian allies.

“None of us can forget those difficult days after September 11th when you offered hospitality and safe harbor for so many stranded Americans whose airplanes had to divert to Newfoundland, Nova Scotia, and all across Canada.

“You were there for us in our hour of need – thank you.

“Today our sons and daughters are fighting shoulder to shoulder in Afghanistan, combating terrorism. At the same time Canadian and American mothers and fathers both face the effects of a fading economic recession here at home.

“In response to these challenging times, we stand together with a common purpose to protect free and peaceful nations and to foster shared prosperity around the world.

“And we agree that trade is one of the best ways to grow the economy and create jobs.

“That’s why President Obama came to Canada on his first official trip outside of the United States to underscore the closeness and importance of the relationship between our two nations. He reaffirmed the commitment of the United States to work with Canada to meet the shared challenges of our times.

“And just last month your Prime Minister Harper hosted the G20 Leaders Summit in Toronto, where our respective leaders pledged to make progress on a range of issues including the Doha round of multilateral trade talks.

“As two of the world’s largest economies and leaders in international trade, Canada and the United States both must be committed to advancing multilateral trade liberalization at the same time as we strengthen our bilateral ties.

“From my first day as United States Trade Representative, I set out to make America’s trading relationship with Canada a top priority.

“I shared this commitment with Minister Van Loan and former Trade Minister Day and said that we ought to be looking for ways to make our partnership even stronger and to contribute to its success and growth.

“For example, back in October, I met with my Canadian and Mexican counterparts at the annual NAFTA Commission meeting. We agreed to work together to collect and share information about the experiences of small- and medium-sized businesses under the NAFTA. And we are going to use that information to identify actions that we can take to help those businesses.

“Today we had a productive discussion to take stock of our work since October. Since essentially all the tariffs between our three countries have been completely eliminated, we must work on reducing other burdens. For example, we are working to reduce transaction costs by eliminating unnecessary regulatory differences.

“This is important work because Small and Medium Sized enterprises are the backbone of the economy and engines of job creation on Main Streets in both Canada and the United States.

“At USTR we have launched an SME initiative to craft trade policy in ways that will help more small businesses access customers abroad and succeed in the global economy, since small businesses that export grow faster, add jobs faster, and pay higher wages.

“Working together we can find ways to help our U.S. and Canadian SMEs take full advantage of the export opportunities that NAFTA provides and utilize regional supply chains to create competitive advantage.

“At the same time, we want to ensure that we respect labor rights and protection of the environment. Since we last met in October, our senior trade officials have met several times to discuss increased cooperation on trade and environment issues. Officials from our trade and labor ministries have discussed proposals on ways to improve the functioning of the labor side agreement. These steps will help pave the way towards collaborative work on these cross-cutting and crucial issues.

“But before I get into more specifics, let me just put these issues in context of our overall bilateral relationship, which is quite impressive and unique.

“The volume of the U.S. – Canada trading relationship is staggering. In 2009, U.S. goods exports to Canada totaled $204.7 billion and goods imports from Canada totaled $226.2 billion. Since the implementation of NAFTA in 1994, two-way trade between the United States and Canada has more than doubled.

“The United States is also the top foreign investor in Canada. In 2008, U.S. direct investment to Canada was $227.3 billion and Canadian investment in the U.S. totaled $221.9 billion.

“This meaningful economic engagement makes a tremendous positive contribution to our economies. We must continue to build upon this success.

“But make no mistake – we have some disagreements such as softwood lumber and country-of-origin labeling that cannot be ignored and need to be resolved.

“We can do so through procedures to which we have both agreed to enforce our respective rights – or through cooperative solutions, such as we recently reached with government procurement.

“Last year when the Canadian government approached the United States expressing its concern over the Buy American requirements in the Recovery Act, I listened.

“After hearing your concerns about the new Buy American requirements, I worked with your ministers to find a solution. Together we were able to turn a short-term bilateral controversy into a long-term opportunity for both of our countries.

“For years, the United States and other countries have sought access to the Canadian provincial procurement markets through the World Trade Organization’s Government Procurement Agreement (GPA).

“Fortunately, we were able to negotiate a ‘win-win’ deal creating new permanent access on both sides of the border to our respective procurement markets.

“Canadian suppliers were able to compete for several programs funded by the Recovery Act, and U.S. suppliers gained access to additional construction projects undertaken by Canadian sub-central entities.

“Our shared success on procurement serves as a strong example of how we can cooperate on other common challenges, such as the global economic recovery from recession.

“Simply put, we need to set an example by stimulating growth without turning inward or resorting to protectionist measures. As global trade leaders, we need to guard against protectionism around the world.

“During the Great Depression – the last time the economy was hit as hard as it is today – knee-jerk protectionism propelled the world into deeper suffering. Country after country walled itself off from trade, each responding to the others’ insular restrictions. Soon global trade was near a standstill.

“We can’t afford to let that happen again. We have to learn the lessons of history or we are bound to repeat the mistakes of the past.

“That is why we need bilateral and multilateral trade policies that open up opportunities, not shut them down.

“We need to seek areas where we can work together to spur economic growth and opportunity between –and within – our countries.

“One such area is in the Doha Round. Furthering trade liberalization through new trade flows and meaningful market openings, which an ambitious and balanced conclusion to the Round would achieve, would spur economic growth not only in North America but in all countries.

“That is why leaders at the G20 Summit in Toronto last month – including President Obama and Prime Minister Harper – committed to continued engagement among key countries to resolve differences and move toward the conclusion of a meaningful round.

“We also need innovative ideas to accelerate our economies. Protecting and promoting innovation – through strong intellectual property rights –is essential to economic growth.

“Canada is home and host to some of the most creative minds in the world. The Toronto International Film Festival (TIFF) has become one of the most prestigious film festivals in the world, contributing over C$170 million to Canada’s economy. But Canada can only reap the full rewards of its innovation and creativity with strong intellectual property protections.

“Take another example – the Blackberry. It was developed here in Canada, but RIM manufactures thousands of them near my hometown of Dallas. This high-tech supply chain is made possible in part by the regional economic integration that NAFTA has created. However, we have to make sure that we protect IP rights across the board so that innovators on both sides of our border have the incentives and legitimate expectations of reward for their creativity and hard work.

“Both of our nations need to create high-wage jobs today, and build new industries that will bring jobs for years to come – not only for large companies, but for small businesses, too.

“Because we both have a shared interest in healthy competition.

“When I talk to American workers about trade, I tell them that it’s my job to keep the playing field level so they can compete on fair terms around the world.

“And with you all here today in Canada, I know you share these goals. You are a proud and hard-working people, too.

“In times like these, we’re all digging a little deeper, pushing ourselves to get better and do more with less.

“We thrive on competition so it’s in our mutual interest to preserve a level playing field when it comes to global trade.

“To that end, Minister Van Loan and I have agreed to meet twice a year to continue this vital work.

“And I look forward to working with all of you as we tackle common challenges, work toward shared goals, and preserve our unique relationship through dialogue and cooperation. Thank you.”