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For two decades, the annual Asia-Pacific Economic Cooperation (APEC) meetings have brought together leaders of 21 of the world’s most dynamic economies, but tangible outcomes haven’t been the rule. Just a day ago, photos of world leaders in Star Trek-like garb looked to be one of the chief deliverables of this year’s meetings in Beijing.
What a difference a day can make. As the APEC meetings wrapped, U.S. officials announced a breakthrough in bilateral talks with China relating to negotiations to expand the product coverage of the World Trade Organization (WTO) Information Technology Agreement (ITA).
As Chamber Executive Vice President and Head of International Affairs Myron Brilliant told the press last night in Beijing: “With economic growth disappointing in many countries, news of a breakthrough in the ITA negotiations is more than welcome. The ITA has been one of the most successful trade pacts in history, spurring growth and innovation across a host of cutting-edge industries.”
Negotiated in 1996 under the umbrella of the WTO, the original ITA has delivered a cornucopia of innovative technology products to the world over the past two decades. Today, 70 countries are members of the ITA, and they account for 97% of world trade in IT products.
Brilliant explained the rationale for the pact’s expansion: “With so many new products created since the ITA was concluded two decades ago, expanding the agreement’s coverage is imperative. Trade in tech goods surpassing $4 trillion annually, so the commercial significance of these negotiations is obvious.”
The Office of the U.S. Trade Representative reports that more than 200 tariff lines will be reduced to zero under an expanded ITA: “Medical equipment, GPS devices, video game consoles, computer software and next generation semiconductors are among the high-tech products that will see tariff elimination.”
The Chamber has worked over the past two years to build support for an ambitious expansion of the ITA. We’ve traveled to Geneva repeatedly to meet with negotiators from dozens of countries, and we’ve raised it as an issue in missions to foreign capitals (especially Beijing, as Chinese officials had been reluctant to eliminate many tariffs). The Chamber was one of 82 top business groups from dozens of developed and developing countries that in September issued a statement calling for action.
This doesn’t mean the ITA negotiations are done, but as the Wall Street Journal explains: “The U.S.-China deal would be presented to the 54 economies involved in the ITA negotiations in Geneva to get their signoff. U.S. officials said they believe they are all expected to do so because Chinese opposition has been seen as the main obstacle and the U.S. has already consulted with other nations.”
The Chamber has said repeatedly that a deal on the ITA is key to the success of China’s APEC year, and so it is. It’s also a big win for the U.S.-China relationship, with benefits for consumers and industries worldwide.
We congratulate U.S. Trade Representative Michael Froman, Deputy U.S. Trade Representative Michael Punke, as well as the Chinese officials who have pushed these negotiations through a difficult stage and, hopefully, brought success within reach.