Trade has been one of the great success stories of the last eight years. In this time of economic uncertainty, the United States must maintain the bold pro-growth policies promoted by the Bush administration and continue opening markets to trade and investment. Shutting our doors would encourage reciprocal action by other countries, exacerbating the current strain on our economy.
The Bush administration’s pro-trade agenda has provided new opportunities for America’s workers, farmers and entrepreneurs by opening markets for U.S. goods and services. When President Bush came into office, the United States had Free Trade Agreements (FTAs) in force with only three countries. Today, we have FTAs in force with 14 countries around the world. The administration is working to put FTAs with three other countries into force, and three more agreements await congressional action. In particular, the president has initiated an expansion of free trade in the Middle East, Latin America and Asia, through networks of FTAs, Trade and Investment Framework Agreements, World Trade Organization (WTO) accessions, and trade capacity building assistance. Today, U.S. exports to the 11 countries with which this administration concluded FTAs have grown 80 percent faster than our exports to the rest of the world.
An FTA is one of the best tools a president has for building prosperity, strengthening economies, improving workers’ rights, promoting environmental protection and fostering democracy. Just as important, an FTA gives American goods and services a competitive edge in our partner countries by removing barriers to trade, such as tariffs.
Some countries - with which we have no FTA - tack on tariffs of 30 percent or more to the price of industrial goods and 80 percent or more to the price of agricultural products. These tariffs often price well-made American goods and services out of the market. Our comprehensive FTAs help our goods and services stay competitive against our foreign competitors.
For example, Canada just signed its own trade agreement with Colombia, and the European Union is close to concluding an FTA with Korea. So when American products compete with comparable Canadian products on Colombian store shelves, or when U.S. suppliers compete with Europeans for a Korean contract, the American products will cost more, unless Congress approves the Colombia and Korea FTAs.
In addition to FTAs, which are the gold standard of trade agreements encompassing every aspect of trade with our partners, the U.S. Trade Representative also creates trade-building relationships with smaller, more specific agreements. For example, we have investment agreements with Uruguay and Rwanda, and have launched negotiations with China, India and Vietnam. These agreements will level the playing field for U.S. companies, promote transparency, the rule of law, and respect for private property, and facilitate the settlement of disputes under international law rules in key emerging markets.
At the center of our work has been the steadfast support for a thriving rules-based global trading system that provides new economic opportunities and contributes significantly to global development and poverty alleviation. Implementation of agreements under the WTO and leadership in advancing the multilateral trade negotiations under the WTO’s Doha Development Agenda have been continuously at the forefront of U.S. trade policy.
The WTO helps America’s goods and services receive fair treatment in the global economy, through a framework of rules that provide transparency, prohibit discrimination against American products, provide commercial predictability and safeguard Americans against unfair trade. As the world’s largest exporter and importer, we need such a system today more than ever.
The WTO is also an important mechanism for addressing global trade barriers and gives us a forum to effectively challenge unfair trade practices. The Bush administration filed 26 cases in the WTO, successfully winning or settling 95 percent of them. In fact, not only were we the first nation to challenge China’s trade practices, but we also have filed the most cases against China. All of these efforts by the administration to liberalize trade and enforce our agreements have contributed to U.S. goods and services trade jumping from $2.5 trillion in 2000 to nearly $4 trillion in 2007. To maintain this progress, the new administration will need Congress to extend Trade Promotion Authority to conclude new free trade agreements and a successful outcome in the Doha Round.
And as impressive as this trade data is, we should also keep in mind that open and fair also promotes our economic, foreign policy and national security interests.
This administration will leave behind an exceptionally strong pro-trade program at USTR that will continue to support American workers, farmers and entrepreneurs. I am honored to have been a part of this effort.
Ambassador Susan C. Schwab is U.S. Trade Representative.