Focus on Sustainability, New Technologies at 2019 World Trade Symposium

USCIB once again sponsored the World Trade Symposium this year November 6-7 in New York. The Symposium, hosted by Finastra and programmed by The Economist Events, brought together researchers, government officials and private sector leaders to discuss “Trade in an Uncertain World.” According to USCIB Assistant Policy and Program Manager Daniella Goncalves, several themes emerged throughout the Symposium, including the impact of new technologies on trade and investment, the need for greater interoperability of new technologies, the importance of sustainability to trade and investment and the continued importance of free trade.

Political uncertainty took center stage during the event’s discussions. The rise of populism and protectionist policies, as well as perceived lack of efficiency and productivity in multilateral fora, were identified as threats to be addressed. Many participants expressed the need to reform multilateral institutions and reaffirmed their support for trade liberalization. The need for U.S. leadership in such reform and trade liberalization activities was highlighted as a priority. Participants were in agreement that the restoration of predictability, reciprocity and fairness is required to bolster global trade and investment.

Digitization has the ability to drive down costs and speed of getting goods to market, but standardization of data protection and date flow regulation are priorities. The importance of regulating data flows and the need for standardized data protection laws, new technologies and the issue of illicit trade were highlighted by several panelists, including the World Trade Organization (WTO) Deputy Director-General Ambassador Alan Wm. Wolff, Research Professor of International Affairs & Director of Digital Trade & Data Governance hub Susan Ariel Aaronson and President of the Mediterranean Shipping Company Fabio Santucci.

The use of blockchain was characterized as a means to more efficiently engage in trade and investment, as well as increase sustainability through decreased paper usage. However, interoperability of blockchains and standardization of regulatory frameworks remain hurdles to wide-spread deployment of this technology.

It was noted that the International Chamber of Commerce (ICC) is working with an Asia-based partner to develop a blockchain technology to enable traceability and tracking of goods. The goal ultimately is to promote interoperability among various blockchain networks and technology platforms.

Recognizing the rise of consumer interest in sustainability, the issue of sustainable trade and investment was discussed. According to the panelists, millennial consumers are driving interest in and profitability of sustainable goods and services. Trade has lifted hundreds of millions out of poverty; to continue to see the benefits of trade, growth needs to be inclusive. USCIB is actively advocating on these important issues in various multilateral fora, including at the Organization for Economic Cooperation and Development (OECD) in Paris.

OECD Report Weighs In On WTO Moratorium Debate

The much-anticipated Organization for Economic Cooperation and Development (OECD) report on the World Trade Organization (WTO) moratorium on customs duties on electronic transmissions was de-classified on November 4.

According to USCIB Senior Vice President for Policy and Government Affairs Rob Mulligan, the report, “Electronic transmissions and international trade – Shedding new light on the moratorium debate,” concludes that revenue implications of lifting the Moratorium are likely to be relatively small and would come at the expense of more significant gains in consumer welfare (estimated at 940 million USD) and export competitiveness.

The Moratorium, which has been in place since 1998 and has been continuously extended every couple of years since then, is once again due to expire at the end of 2019. Keeping the Moratorium is crucial for business, and USCIB has been actively engaged in pushing back against the opponents of extending the Moratorium with the ultimate goal of making it permanent.

The OECD report also notes that the highest estimated share of opportunity cost in terms of foregone revenue is in digitizable goods, which is low, at 1.2% of total trade. This will likely remain low even with the advent of technologies such as 3D printing, which are unlikely to have far-reaching implications on trade in the near term.

The report noted that tariffs also come with costs. Tariffs are associated with lower output and lower productivity and their burden falls mainly on domestic consumers, not foreign firms. Tariffs are also an unstable source of revenue. Alternatives exist in the form of non-discriminatory value added taxes or goods and services taxes.

The WTO General Council meeting, set for December 9-11, will provide a final opportunity to extend the Moratorium.

USCIB Welcomes New US Ambassador to UN in Geneva

L-R: Rob Mulligan, Peter Robinson, Andrew Bremberg, Shaun Donnelly

Newly-confirmed U.S. Ambassador to the United Nations offices in Geneva, Andrew Bremberg, visited USCIB’s Washington office on November 5 to share U.S. government priorities and to hear business perspectives and concerns before heading to Geneva to assume his post later this week. Throughout the discussion, Ambassador Bremberg emphasized that the U.S. government’s current priority, as well as his top personal priority, is to reform and improve international organizations.  

USCIB members from The Walt Disney Company, Facebook, ExxonMobil, Hanesbrands, PMI and Walmart, along with USCIB policy experts, emphasized the importance of supporting inclusive multilateralism such as that found in the World Trade Organization and International Labor Organization, and changing the persistent and counter-productive discriminatory treatment that the private sector encounters in some UN agencies.

USCIB’s Norine Kennedy, who helped lead the USCIB delegation to Geneva earlier this year, noted USCIB initiatives to help further inclusive multilateralism through USCIB’s All In Campaign. Several participants expressed appreciation for the support Ambassador Bremberg’s team at the U.S. Mission in Geneva has been providing to U.S. business.

“We see ourselves as global regulatory diplomats,” added USCIB President and CEO Peter Robinson. “The challenges facing society today cannot be solved by governments without having business at the table.  We look forward to working with Ambassador Bremberg and his staff as he begins his important work with the WHO, the World Intellectual Property Organization, the International Labor Organization, the International Telecommunications Union and other UN agencies in Geneva.”

 

New OECD Deputy Secretary General Meets With USCIB

L-R: OECD Deputy Secretary General Ulrik Vestergaard Knudsen; Head of the OECD’s Washington office Will Davis

USCIB members and staff had the opportunity to meet with the new Organization for Economic Cooperation and Development (OECD) Deputy Secretary-General Ulrik Vestergaard Knudsen on November 5 at the USCIB Washington DC office. Knudsen’s diverse policy portfolio at the OECD includes science, technology and innovation, trade and agriculture, the OECD Center for Entrepreneurship, SMEs, as well as regions and cities.

The dialogue between Knudsen and USCIB members focused on areas of mutual interest such as taxation policy, including the pressing issue of digital taxation, as well as cross-border data flows, healthcare, trade and investment, digital trade, and the Going Digital Project. Knudsen also mentioned Artificial Intelligence (AI) as an increasingly important issue for the OECD and the establishment of the OECD AI Policy Observatory, which will help countries nurture and monitor the responsible development of trustworthy AI systems for the benefit of society.

L-R: Norine Kennedy (USCIB), Will Davis (OECD Washington), Ambassador Ulrik Vestergaard Knudsen (OECD), Peter Robinson (USCIB), Eva Hampl (USCIB), Rob Mulligan (USCIB)

USCIB members from Microsoft, IBM, General Electric, CropLife America, Walmart and others, benefited from the opportunity to hear directly from OECD leadership regarding the OECD’s priorities as well as an update on the OECD accession process. USCIB participants underlined the importance of maximizing access for business and other responsible stakeholders in all OECD committee meetings.

“We are grateful that DSG Knudsen took the time to meet with U.S. business,” said USCIB Senior Vice President for Policy and Government Relations Rob Mulligan. “USCIB staff and members always appreciate an opportunity to provide perspectives to the OECD staff and secretariat to help inform the OECD’s science-based policy recommendations.”

USCIB is the U.S. national committee of Business at OECD (BIAC).

P&G, Pepsi Receive Prestigious State Department ACE Awards

P&G’s Selina Jackson accepts ACE Award for Women’s Economic Engagement

Secretary of State Mike Pompeo presented the State Department’s annual Awards for Corporate Excellence (ACE Awards) for 2019 at an impressive public ceremony at the Department on October 31. As in most years, USCIB member companies swept the large multinational company categories.

Procter & Gamble Vice President of Global Government Relations and Public Policy Selina Jackson accepted the ACE Award for Women’s Economic Empowerment on behalf of P&G Asia Pacific for its impressive program to develop and promote women executives and managers through that key region.

PepsiCo’s Phil Myers accepts ACE Award for Sustainable Operations

PepsiCo Senior Vice President, Global Government Affairs and Public Policy, Phil Myers accepted the ACE for Sustainable Operations on behalf of PepsiCo India, recognizing its path-breaking work on water conservation and quality in India. Both recipients, as well as the winners in the parallel Small and Medium Enterprise categories, delivered gracious remarks to the crowd of U.S. government officials, foreign diplomats and business leaders.

PepsiCo and P&G were selected from impressive cohorts of nominations by U.S. Ambassadors around the world, each nominating particularly outstanding corporate citizens in the local U.S. business community.  P&G is a repeat winner, having won a 2011 ACE for its work in Nigeria and Pakistan. USCIB Vice President and former U.S. Ambassador Shaun Donnelly represented USCIB at the ceremony and congratulated USCIB member company winners.

“It seems almost every year, USCIB member companies win one or both of these prestigious ACE Awards,” Donnelly said.  “Our member companies, typified by P&G and PepsiCo, are widely recognized as leaders in all areas or corporate responsibility and sustainability in a wide range of foreign countries, developed and developing, including in some very challenging environments. We are very proud to see them recognized.”

For a list of previous ACE Award winners, see here.

 

USCIB Member Reports on Recent UN International Trade Law Meetings

Lauren Mandell, an international investment expert from the Washington DC office of USCIB member WilmerHale and a former deputy assistant U.S. Trade Representative for investment policy, represented USCIB at the October 14-18 meeting of the United Nations Commission on International Trade Law (UNCITRAL) Working Group III in Vienna. Mandell was one of a small handful of business and arbitration community observers at this semiannual meeting.

UNCITRAL’s Working Group III is focused on “reforming” the Investor-State Dispute Settlement (ISDS) arbitration system, which is widely used to resolve investment disputes between host governments and foreign investors. Some governments and civil society activists have long criticized the ISDS system. In recent years the European Union has jumped on board, aggressively pushing its proposal for a government-dominated multilateral investment court and appellate mechanism to replace traditional ISDS. According to Mandell, even long-standing U.S. government policy supporting a high-standard ISDS system has wavered.

Photo source: UNCITRAL.org

“It was very valuable to have an experienced, eloquent investment policy expert like Lauren participating in this important investment policy body,” said USCIB Vice President for Investment Policy Shaun Donnelly. “Although UNCITRAL may be, to some, an obscure UN agency, it’s where the action is these days on international investment policy and, specifically, on ISDS. We at USCIB and many of our member companies see ISDS as a key pillar for global Foreign Direct Investment (FDI) decisions. We will continue to work with Lauren, the U.S. government and our members in UNCITRAL and beyond to defend strong investment protections.”

The next meeting of UNCITRAL Working Group III, scheduled January 20-24, 2020, will be critically important for the business community because the meeting will focus on the EU’s proposed multilateral investment court. For more information, contact Shaun Donnelly or Lauren Mandell (lauren.mandell@wilmerhale.com) for further information.

USCIB Joins Global Business Network on Forced Labor

USCIB proudly became a new member recently of the International Labor Organization’s (ILO) Global Business Network on Forced Labour (GBNFL). A “network of networks,” GBNFL seeks to bring together businesses of all sizes and sectors, and their networks, from around the globe to work towards the eradication of forced labor. USCIB Vice President of Corporate Responsibility and Labor Affairs Gabriella Rigg Herzog attended GBNFL’s first annual meeting on October 21 in Berlin, where participants engaged in discussions around what coordination and collaboration looks like, as well as how best to engage smaller enterprises to combat forced labor.

In brainstorming about opportunities for shared action provided by this new umbrella network, participants recognized that many of the challenges stem from local governance gaps. Participants discussed ideas and noted the critical role that the ILO can play in assisting national and local governments to mount a robust domestic labor law enforcement response to this issue. Additionally, participants expressed a hope that additional employer organizations from developing countries would be encouraged to join the GBNFL, particularly as the members of those employer networks are the local businesses and SMEs producing for either domestic or foreign markets. Participants agreed that capacity building, both of governments and SMEs, is crucial to any plan to help achieve SDG target 8.7.

USCIB members will benefit from our active involvement in GBNFL through invitations to participate in special events and webinars hosted by GBNFL, as well as have the opportunity to help inform the USCIB feedback to GBNFL as its leaders develop future workplans. For the broader public, we encourage you to learn more about the GBNFL and avail yourself of the data, tools and resources regarding forced labor and human trafficking housed on GBNFL’s new website and public library of selected resources.

Promoting U.S. Business Access: USCIB Submits NTE Comments

USCIB filed comments on October 25 for the annual National Trade Estimate (NTE) report to highlight significant barriers that American companies continue to face with regards to exports of goods, services and U.S. foreign direct investment. The comprehensive comments included barriers faced by U.S. companies in over twenty countries, including in Brazil, China and India.

According to USCIB Vice President for ICT Policy Barbara Wanner, the comments urged the U.S. Trade Representative to encourage Brazil to promote an international, interoperable policy framework for the Internet of Things (IoT) and machine-to-machine (M2M) solutions that includes M2M permanent roaming, among other things.

“Many IOT and M2M solutions will only reach their optimal scale if they can operate around the globe,” said Wanner. Monitors on airline cargo or shipping containers must be able to operate wherever their freight travels. Automakers sell vehicles across many different countries and operators drive vehicles across national borders for commercial and personal purposes; automakers and customers alike need a single communications platform to support their connected vehicles.

“The Brazilian government should modify the regulatory framework to support providers of IoT and M2M services and devices and allow them to choose between various available options for numbering and device management (including permanent M2M roaming), rather than imposing a single, one-size alternative for all cases,” added Wanner.

With regards to China, USCIB’s submission focused on China’s WTO compliance record in services, particularly China’s indiscriminate filtering and blocking of online services. China’s expansive definition of value-added services, high capitalization requirements for basic telecommunications services, lack of an independent regulator, and restrictions that specifically apply to the non-Chinese companies for provision of value-added services remain key outstanding issues for U.S. business.

Finally, while India has accelerated broadband deployment, USCIB’s comments stressed that it must also implement policies that foster an innovative environment through predictable, progressive and technology-neutral policies that are compatible with global standards.

“It is important to keep encouraging the Indian government to support further market liberalization and to remove remaining market access barriers,” said Wanner. “India should be urged to continue its efforts to provide legal and regulatory policy certainty both in the development of a body of clear and consistent laws and regulations, and in the transparent and equitable application and enforcement of those laws and regulations. Unfortunately, in recent years the government of India has implemented a number of policies that constitute significant market access barriers to U.S. companies, including in data localization, remote access policy and cloud computing.”

Mulligan Represents Business at OECD Trade Meetings

USCIB Senior Vice President for Policy and Government Affairs Rob Mulligan

Rob Mulligan, USCIB senior vice president for policy and government affairs, was in Paris the week of October 21 attending OECD and Business at OECD (BIAC) trade committee meetings. Over the last few months, USCIB members have contributed to the development of BIAC’s trade priorities paper which was released last week. Mulligan, as a vice-chair of the BIAC trade committee, represented BIAC at the OECD Trade Committee Meeting and shared the eleven-priorities for consideration as the OECD develops their program of work for 2021-2022.

“During the OECD meeting, I highlighted the need for continued OECD work on market distorting subsidies and other government support for state-owned enterprises, digital trade and new work on trade and the environment that would underpin the need to balance climate change with ensuring open markets for trade,” said Mulligan.

The OECD Trade meeting also discussed ongoing G7, G20 and Asia Pacific Economic Cooperation (APEC) activities, including outcomes of the G7 and G20 Summits, as well as expectations for the APEC Economic Leader’s meeting in November, which will be hosted by Chile.

USCIB Announces Launch of a Biodiversity Working Group

Responding to intergovernmental policy discussions on biodiversity, their implications for American companies, and the opportunity for private sector nature-based solutions, USCIB has announced the launch of a new multi-committee Working Group on Biodiversity. The Working Group is drawn from USCIB’s Environment, Intellectual Property and Innovation and Food and Agriculture committees to reflect the cross-cutting nature and impacts of proposed policies for U.S. companies doing business in global markets. It will begin its work in early November, with a focus on tracking and disseminating business-relevant information about the United Nations Convention on Biological Diversity (UN CBD) negotiations to interested USCIB members.

According to USCIB Vice President for Energy, Environment and Strategic International Engagement Norine Kennedy, this new group will also provide a platform to work with the International Chamber of Commerce (ICC) Access and Benefit Sharing (ABS) Working Group, the Global Industry Coalition and other business initiatives related to biodiversity. The Biodiversity Working Group will also facilitate USCIB representation at UN CBD meetings (by both members and USCIB staff) and support the development of USCIB positions as needed.

“The UN CBD is developing a post-2020 biodiversity framework, which will feed into the UN Sustainable Development Goals,” noted Kennedy. “We hope to use this new platform to work with our international partners, such as ICC, to ensure that governments adopt policies that encourage business innovation and include business in future discussions.”

USCIB is planning to attend a workshop on November 6 in Madrid, organized by ICC and Business for Nature Consultation. Workshop participants will discuss and develop draft policy recommendations to governments that are needed to further scale-up existing actions and commitments taken by business to reverse nature loss and restore natural systems.

 If you are a USCIB member interested in joining this Working Group, please contact USCIB Vice President for Energy, Environment and Strategic International Engagement Norine Kennedy.