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As physicist Niels Bohr once said, “prediction is very difficult, especially about the future.” But with trade policy rising to the top of Washington’s agenda in the New Year, some questions are bound to loom large.
Will Congress Renew Trade Promotion Authority (TPA)? For the Chamber, the answer has to be an emphatic yes. We’re pleased to see that Congress is preparing to take up a TPA bill, which promises to facilitate trade deals.
TPA allows Congress to set negotiating objectives, and it requires the executive branch to consult extensively with Congress during negotiations. It also gives Congress the final say on any trade agreement in the form of an up-or-down vote.
Few current members of Congress were in office when TPA was last approved in 2002, so there’s no question that the business community has work to do to make the case for its approval. But we think we have the winning argument because TPA is key to securing new market-opening, growth-driving, job creating trade agreements.
The case for TPA is simple. In today’s tough international markets, we need our trade negotiators to tear down the foreign tariffs and other barriers that too often shut out U.S products. That’s what trade agreements do. For this to happen, Congress must first approve TPA.
Will the U.S. Conclude the Pacific and Atlantic Trade Talks? The United States is close to concluding negotiations for a trade pact dubbed the Trans-Pacific Partnership (TPP), which involves 11 other Asia-Pacific countries, including Japan, Malaysia, Mexico, and Vietnam.
The appeal of the TPP is simple. Two billion Asians joined the middle class in the past 20 years, and another 1.2 billion will do so by 2020. The IMF estimates that the world economy will grow by $22 trillion over the next five years, and nearly half of that growth will be in Asia. The TPP will help U.S. companies tap these booming markets.
In a second big negotiation, the U.S. is pursuing a Transatlantic Trade and Investment Partnership (TTIP) with the EU, the largest market for U.S. business. U.S.-EU trade reaches $1 trillion annually and employs 15 million Americans and Europeans. Even so, eliminating today’s relatively modest trade barriers would bring big benefits.
While the TTIP negotiations are just getting underway, the TPP is in the final stretch. The president’s planned trip to Asia in April may concentrate minds and bring the negotiations to a head.
Getting the TPP done in 2014 is important. Even more important is making sure it’s a high-standard, comprehensive agreement with the biggest possible benefits for U.S. companies, workers, and farmers.
Will Fallout from l’Affaire Snowden Hit U.S. Trade? Edward Snowden’s allegations of extensive NSA surveillance of communications worldwide have roiled U.S. diplomatic relations. But U.S. business interests globally have suffered collateral damage as some governments have moved to limit companies’ freedom to move digital information across international borders.
However, it’s a mistake to conflate alleged espionage by governments with how companies in different sectors rely on cross-border data flows. Companies of every size, sector, and country have come to rely on the ability to move data across borders to create valuable products and services, enhance productivity, combat fraud, protect consumers, innovate, and create jobs.
In fact, digital trade is just one more way for American businesses to reach the 95% of the world’s consumers located outside of U.S. borders.
Will more governments adopt digital protectionism in 2014? It’s hard to say, but second thoughts have slowed the drive for new barriers in some countries. Preserving the freedom to move data across national borders will continue to be one of the Chamber’s top trade priorities in 2014.