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Remarks by Ambassador Ron Kirk to the National Bureau of Asian Research

Ambassador Ron Kirk

Remarks to the National Bureau of Asian Research
Washington, DC
March 30, 2011

*As Prepared for Delivery*

“Good afternoon. Thank you, Dr. Ellings. It’s a pleasure to be here for the National Bureau of Asian Research (NBR) Engaging Asia conference.

“Before I turn to today’s topic, I want to echo President Obama’s words and offer the United States’ condolences to the people of Japan, who are enduring great suffering and loss as a result of the recent earthquake and tsunami. Over the past few weeks the American people have been both heartbroken and deeply concerned about this tragedy that has befallen our close friend and ally, Japan.

“President Obama and Prime Minister Kan spoke by telephone last night for the third time since March 11. The President reiterated that the United States is determined to support the people of Japan in their efforts to deal with the devastating effects of this tragedy, both in the short and the long term. Prime Minister Kan thanked the President for the extensive U.S. help in the response effort.

“Likewise, America has also extended condolences and sympathy to the peoples of Australia and New Zealand as they continue to cope with the destructive effects of the recent floods in Eastern Australia and the earthquake in Christ Church. The United States is working with the Governments of Australia and New Zealand to provide technical assistance in light of these recent disasters.

“All of these tragic events are poignant reminders of just how closely the United States is tied to the Asia-Pacific. Even as we focus on supporting disaster relief operations, we are witnessing how supply chain disruptions in the Pacific can affect production of everything from commodities to computer chips. And we are seeing economic ripple effects in American industries ranging from agriculture to high-tech manufacturing.

“Events like these underscore the urgency with which the United States is leading ambitious efforts to increase trade and economic integration across the Asia-Pacific in cooperation with our trading partners.

“As we consider the dynamic U.S trade relationship with Asia, let’s begin with the overall context for U.S. economic policy. In his State of the Union address this year, President Obama spelled out his long-term vision for the United States to win the future and secure better jobs for more Americans.

“The President’s plan calls for enhancing U.S. competitiveness through investments in education, innovation, and infrastructure, while at the same time reforming government and cutting what we cannot afford so that we can live within our means.

“Trade is a critical component of the President’s plan to win the future, because open trade policies will support U.S. competitiveness and economic growth.

“And all signs indicate the Asia-Pacific will continue to be the region with the most rapid economic growth over the coming decade.

“That’s why we’re setting high standards for trade that supports jobs, innovation, and greater shared prosperity across the Asia-Pacific far into the 21st century.

“We believe these goals can best be achieved by building a platform for broad-based regional trade that is more responsive to global producers’ and consumers’ needs today, as well as flexible enough to grow with future business and technology developments.

“Of course, I could talk about any one of our initiatives in the Asia-Pacific for an entire hour, but I’d like to leave plenty of time for our discussion today.

“So rather than attempt to cover the entire waterfront – or perhaps I should say, the entire Pacific Rim – I’d like to highlight four key elements that President Obama and I believe should support a strong trade platform for continued growth in the Asia-Pacific: fostering and protecting innovation, reducing non-tariff barriers to trade, respecting labor rights and the environment, and engaging with stakeholders.

“And, in turn, I’ll discuss each of these elements as they apply to some of our key initiatives in the region: the U.S.-Korea trade agreement, the Trans-Pacific Partnership (TPP) negotiations, the APEC 2011 host year agenda, and our ongoing dialogue with China.

“First, we are setting high standards to protect and promote innovation, which is critical to economic growth and prosperity. The United States is the most innovative economy in the world, and the Administration is doing everything it can to support jobs that depend on American innovation, including protecting and enforcing U.S. intellectual property rights.

“In fact, the U.S.-Korea trade agreement contains the strongest protections for intellectual property rights ever negotiated in a U.S. trade agreement to date. It includes important state of the art measures to protect American brand-name products, copyrighted content, and patented inventions, including strong enforcement provisions in these areas.

“Fostering respect for intellectual property rights is also an important objective in the Trans-Pacific Partnership negotiations. We intend to make the protection and enforcement of intellectual property rights a cornerstone of TPP, because intellectual property is critical to the development of knowledge-based and creative industries. A strong IP framework will give every country the potential to attract trade and investment and ‘move up the value chain’ to become an IP producer.

“In APEC in 2011, we are also discussing the intersection between trade and innovation. Specifically, we are looking to advance through APEC the adoption of competitive, market-driven innovation policy in the region that is critical to economies’ ability to use technology to effectively promote innovation. This initiative will give us a good opportunity to discuss why the ability to use technology is critical to growth, and why policies that limit this access are detrimental to countries’ future economic prospects.

“Of course, any conversation about trade and innovation in the Asia-Pacific must include China. To be sure, we have made progress through dialogue with China as we encourage them to end indigenous innovation policies that create an uneven playing field for American entrepreneurs and stifle the strong, open innovation that will benefit both China and the United States.

“At last year’s Joint Commission on Commerce and Trade, we achieved the best results we have seen in years on intellectual property and innovation, including commitments by China to increase purchases and use of legal software and to crack down on internet piracy. And China recently committed to separate its innovation policy from the provision of government procurement preferences – a key concern for America’s innovators and creative industries.

“Moving forward we will continue to use the full set of trade tools at our disposal to encourage our Chinese partners to implement policies that allow true innovation to thrive, including open markets and strong intellectual property protection.

“Second, we are seeking to reduce non-tariff barriers to trade, because even as tariffs are coming down all across Asia many countries are proliferating their use of non-tariff measures that restrict market access.

“To reduce or eliminate non-tariff trade barriers, the U.S.-Korea trade agreement sets high standards for regulatory transparency. For example, Korean authorities will be required to publish proposed regulations in advance and provide interested parties, including U.S. producers, with opportunities to comment.

“Similarly, both TPP and APEC address non-tariff barriers to trade. In the TPP negotiations we are looking at trade and investment barriers that especially affect U.S. small businesses – such as complex legal frameworks – and finding ways to eliminate or minimize those barriers.

“And in our APEC discussions we have set a goal this year to work toward building a seamless regional economy. We are seeking measures that will help to facilitate the flow of goods and services throughout the region.

“With China we are also addressing non-tariff barriers, using everything in our trade toolkit. For example, at last year’s JCCT meeting, China committed to eliminate an eligibility requirement that had blocked foreign wind power turbine manufacturers from competing for large-scale wind power projects in China.

“And recently we sued China over its policies ensuring that a national champion dominates China’s electronic payment services market to the detriment of highly competitive U.S. firms.

“Third, we recognize that as regional integration accelerates, our economies are becoming even more interdependent. So in order to promote stability and ensure a level playing field, we also have to set high standards for the protection of worker’s rights and the environment.

“In this third critical area, the U.S.-Korea trade agreement has the highest standards for the protection of labor rights and the environment. It contains mechanisms for the effective enforcement of labor and environmental laws, combined with strong remedies for non-compliance. As a result, the U.S.-Korea trade agreement will provide a level playing field for American producers by upholding strong labor and environmental protections in Korea.

“TPP negotiators are also aiming for the highest standards for labor and the environment. In fact, right now our USTR negotiators are engaging with Congressional Democrats and Republicans on TPP to find a common way forward on strong labor and environmental provisions, including new obligations that address illegal trade in fisheries, wildlife, and logging.

“In addition, one of our key APEC priorities is to take steps to promote green growth, including by eliminating barriers to trade in environmental goods and services, facilitating trade in remanufactured goods and low-carbon vehicles, and combating trade in illegal logging.

“We continue to engage our Chinese trading partners on labor and environmental issues, including the growing green technology sector.

“But where we could not make effective progress through dialogue with China, we also have not hesitated to use the other tools at our disposal.

“For example, we recently brought China to the WTO over what we believe are prohibited subsidies that tip the innovation scales in favor of Chinese wind energy manufacturers.

“Finally, that brings me to a fourth element – engaging with stakeholders. This may sometimes seem like a simple procedural issue, but on the contrary we believe it leads to better results, as evidenced by the successful improvement of the U.S.-Korea trade agreement and strong momentum in the Trans-Pacific Partnership negotiations.

“Over the past two years the Obama Administration engaged extensively with Congress and a wide range of stakeholders as we worked to understand and address outstanding issues related to the U.S.-Korea trade agreement. As a result we were able to secure new commitments that give American auto manufacturers and workers improved access to the Korean market and a level playing field to take advantage of that access.

“We’re continuing this commitment to engagement in our TPP negotiations, where Congress and stakeholders have been included in every stage from formulating negotiating positions to providing direct input on the margins of formal negotiating rounds.

“Our expanded program of consultation has informed our TPP negotiating positions and energized our approach to the talks, especially in addressing emerging trade issues and the concerns facing U.S. workers and businesses today.

“Furthermore, I have traveled across the United States – from Maine to Arkansas – to talk with American workers and exporters about their perspectives on trade and the ways that trade agreements can work for them.

“Similarly, we will sustain high level of public engagement throughout the APEC 2011 host year. In addition to policy meetings, we have planned events to highlight the benefits of trade to the American public and to educate our Asia-Pacific trade partners about the competitive range of products and services our companies have to offer to help these economies grow and prosper.

“And of course we continue to seek input from Congress and a wide range of stakeholders regarding our incredibly important trade relationship with China.

“The four elements I’ve just described – fostering and protecting innovation, reducing non-tariff barriers to trade, respecting labor rights and the environment, and engaging with stakeholders – are key themes of our major trade initiatives across the Asia-Pacific, and we intend to continue pursuing high standards in each of these areas.

“It’s not easy, but it is essential. And make no mistake – we won’t sacrifice high standards for the sake of a saccharine consensus.

“We mean business because we support U.S. businesses, both large and small – not to mention American farmers, ranchers, manufacturers, service providers, workers, and their families – whose livelihoods – like millions of others in countries around the world – depend on open trade throughout the region.

“Together with our like-minded trading partners and with critical support from key stakeholders like you, we are leading the way forward toward greater prosperity with better jobs for more people in the United States and across the Asia-Pacific. Thank you.”