American commercial diplomacy programs must adapt quickly to today’s global marketplace, characterized by global value chains, integrated production networks and strong competitive pressures for ever-greater efficiency. “Support for American Jobs,” a new report from the American Academy of Diplomacy co-authored by Academy members Shaun Donnelly, USCIB’s vice president for investment and financial services, and Chuck Ford a retired director general of the Foreign Commercial Service and former U.S. Ambassador to Honduras. The report provides recommendations to the U.S. Departments of State and Commerce to inform the development and execution of government programs that help U.S. companies do business abroad.
“The international consensus on the accepted ‘rules of the game’ has broken down, with the emergence of alternative approaches that have yet to fully mature into next-generation rules to guide world trade and investment,” the authors write in the report’s executive summary. “Intellectual property rights, copyrights, trademarks, designs, and trade secrets will be crucial to maintaining America’s competitive edge, yet they will only work if our economy has skilled workers and creative entrepreneurs who are supported by the right policy environments.”
The report notes that global value chains are core contributors to business success internationally and job creation domestically, and that U.S. commercial diplomacy programs that support America’s competitive position must become a central tenet of U.S. foreign policy. To that end, the report provides six recommendations for government action:
- Develop, as rapidly as possible, a new policy framework to guide the design of a next-generation commercial diplomacy program to advance US national interests in the ever-more-challenging global economy.
- Review existing commercial diplomacy programs to identify programmatic and personnel capacity gaps and to present solutions so that ambassadors and their teams will be fully equipped to advance our national interest.
- Set up a private sector consultative mechanism to ensure systemic oversight of commercial diplomacy programs in cooperation with the private sector.
- Assess new collaborative programs and partnerships with private enterprises to advance national economic and commercial interests across the global marketplace.
- Create a formal cooperative mechanism to oversee human resources talent-management systems for economic and commercial officers and local employees so as to enhance successful outcomes in recruiting, retaining, and developing the strongest possible team to execute commercial diplomacy programs across the foreign affairs platform.
- Build a formal mechanism to coordinate economic/commercial training and education programs, with a particular focus on creating new partnerships with private partners to meet the priority business requirement of short customized courses on cutting-edge issues, many of which are vastly complex in the emerging technology sector.
Donnelly contributed to the report’s section on U.S. business views on global value chains and foreign investment, noting the frustration from the business community that arises from a sense that the U.S. government does not understand the importance of global value chains and foreign direct investment for doing business in the 21st century.
“Business representatives perceive that key aspects of US trade and investment policy are based on a simplistic mercantilist view that exports are good but imports are bad; that inward investment/FDI is good but outward investment is bad,” the report states. “Many business representatives would welcome a serious, substantive review by the government on US global investment policy, both inward and outward, in today’s and tomorrow’s globalized economy.”
Before joining USCIB, Donnelly had a 36-year career in the State Department’s Foreign Service, concentrating on international economic policy. He served as principal deputy assistant secretary of state for economic and business affairs from 2000 to 2005 when he moved to the Office of the U.S. Trade Representative (USTR) at the White House as assistant USTR in charge of Europe and the Middle East. Earlier he had served as U.S. Ambassador to Sri Lanka and Maldives. At various times he was also deputy assistant secretary of state in charge of international trade policy, international energy policy, and economic sanctions.
The report’s findings were drawn from interviews with more than 50 corporate executives, including USCIB members, and senior executives at the Departments of State and Commerce.