The Asia-Pacific Economic Cooperation (APEC) trade ministers who met in Big Sky, Montana, today finally took a hard-nosed look at the state of the World Trade Organization Doha negotiations and admitted that what the United States has been saying for several years: the gaps in expectations for opening new market opportunities around the world are unbridgeable in the current context.  As Ambassador Kirk noted, “we are not in good shape.”  

We welcome this recognition of reality that should help the WTO move forward in a constructive way, rather than continuing to chase its tail in a desperate hope that given enough time the pieces will magically fall into place. 

So the question now becomes what to do with the pieces of Doha that aren’t broken.  We hope that in this period of reflection WTO Members will give serious consideration to moving ahead in concluding negotiations in areas that can garner consensus. One of these issues should be the trade facilitation negotiations aimed at simplifying and speeding procedures for getting goods through customs formalities.

In an age when a large portion of exports are delivered in hours by air rather than weeks or months by sea, the length of time and costs of customs clearance procedures needs to be reduced so components can get to manufacturers and finished products to customers more rapidly. This is not a zero-sum negotiation that involves mercantilist concessions; it is classic win-win. 

Ministers should also give greater consideration to so-called plurilateral agreements that don’t require every WTO country to sign on, such as the Information Technology Agreement. It should be expanded to provide zero-duty treatment for more high-tech products. The existing agreement dating from 1997 has been very successful and reduced costs for manufacturers that rely on information technology products to enhance their competitiveness. There could be other plurilateral agreements that could garner sufficient support–perhaps environmental goods and services.

The WTO is a strong and vital organization and its value should not be assessed on what happens with the Doha negotiations. An organization that deals forthrightly with the situation it faces will be a strong one. 

As is said, the first step to recovery is the recognition that there is a problem.

Stephen Jacobs is senior director of international business policy, National Association of Manufacturers.  

The President travels further in Asia, the lameduck Congress draws closers, and the G20 meets in Seoul. Thursday is a federal holiday, Veterans Day, and the National Association of Manufacturers will be closed.

President Obama’s Trans-Asian Express takes him to Indonesia — barring further volcanic eruptions – South Korea and Japan. The G20 opens Wednesday in Seoul, with the President in attendance. Expect more public comments embracing trade, with the possibility of an announcement about moving forward with the U.S.-Korea Free Trade Agreement after the President parleys with his Korean peer, Lee Myung-bak. The President also attends the APEC summit in Yokohama starting Saturday, a stop that includes a tête-à-tête with new Japanese Prime Minister Naoto Kan.

It is the final week before 111th Congress returns for its first lameduck session on Monday, Nov. 15. Every day that passes brings the Jan. 1, 2011, tax increases closer, so expect more pre-session disputes, arguments, and “partisan squabbling.” But better a lameduck flap than a lameduck flop.

Economic Reports: On Tuesday, the Commerce Department releases wholesale trade inventories for September. Commerce releases international trade figures for September on Wednesday, with economists anticipating a narrowing of the trade deficit.

Executive Branch: U.S. Trade Representative Ron Kirk travels to Yokohama for the APEC summit  (USTR schedule). Fresh off his trip to Scotland and Ireland to promote “clean” energy, Energy Secretary Chu starts a new tour Sunday to China and Japan. Stops  include a visit to Huaneng Power’s carbon capture and storage project and on Monday, a tour of  GE’s China Technology Center. Interior Secretary Ken Salazar and HHS Secretary Kathleen Sebelius on Friday attend a groundbreaking ceremony for a new visitors center at the Tallgrass Prairie National Preserve in central Kansas.

Starting today in Washington, D.C., the National Oil Spill Commission and its Chief Counsel Fred Bartlit hold a two-day hearing on preliminary findings regarding BP’s Macondo well blowout

Trade ministers from the Asian-Pacific Economic Cooperation group have finished their meeting in Sapporo, Japan, with a statement pushing for a conclusion to the Doha Round of WTO negotiations, “Statement on Supporting the Multilateral Trading System and Resisting Protectionism.” Excerpt:

We, the APEC Ministers responsible for Trade, gathering for our XVI meeting in Sapporo, Japan, express our strong commitment to the multilateral trading system and our unwavering determination to bring the Doha Development Agenda (DDA) to a successful conclusion as soon as possible.

(Promoting the Doha Development Agenda)
1. The strengthened multilateral trading system is a source of economic growth, development and stability. Bearing in mind that further reform and liberalization of trade policies will bolster economic recovery, we reaffirmed our resolve to seek an ambitious, balanced, and prompt conclusion to the DDA, consistent with its mandate, built on the progress achieved, including with regard to modalities.
2. When the G20 finance ministers meet again in Toronto later this month, they’ll be asked to support the political momentum to speed up negotiations on the stalled Doha talks on global trade. That was the pledge made by a meeting of Asia Pacific trade ministers in Japan at the weekend. The ministers of the Asia-Pacific Economic Cooperation forum also agreed to outline a plan on possible ways to reach a regional free trade area.

Radio Australia has a good interview with Simon Creen, Australia’s trade minister, on the APEC meeting: (continue reading…)

President Obama gave a speech in Tokyo Saturday announcing the Administration’s plans to engage with the Trans Pacific Partnership countries to shape a regional agreement, an engagement that could produce real benefits for U.S. exporters and manufacturers. The Asia-Pacific region is the world’s fastest growing both in terms of trade and in the number of trade agreements being negotiated.  The NAM has long called for a trans-pacific trade agreement that would open up the region to U.S. exports.  America’s manufacturers cannot afford to be on the outside of an Asian trade wall looking in.

Reacting to the President in a statement, U.S. Trade Representative Ron Kirk made the case that a high-standard regional trade agreement under the Trans Pacific Partnership could help generate American jobs and economic prosperity.  (USTR fact sheet.) Exports will be the driver of U.S. economic recovery, but only if they have open access to world markets.

Strong U.S. leadership will be necessary to achieve a regional Pacific agreement that includes the highest standards already incorporated in U.S. bilateral agreements.  The United States currently has bilateral agreements with four of the seven Trans Pacific partners – Australia, Chile, Peru, and Singapore. (The others are New Zealand, Brunei, and Vietnam.) None of the gains for American manufacturers that were negotiated in those agreements should be abridged in any way, including intellectual property and investment protections and market access commitments. 

We were also pleased to see President Obama’s urging other nations to join the United States in demanding an ambitious and balanced Doha agreement, “not any agreement, but an agreement that will open up markets and increase exports around the world.”  This is the only road to success for the Doha Round.

The President’s focus on trade and trade agreements highlighted in his Asian trip should not, however, push other trade priorities off the table. On the contrary, they should produce a concerted effort to resolve any last issues with the three pending trade agreements – Colombia, Korea, and Panama – so these can be sent to Congress for approval.

News coverage…

• Associated Press, “APEC urges new growth model, climate pact progress“
• Reuters, “Obama pledges greater US engagement in Asia“
• Radio New Zealand, “Free trade deal may be in place in two years, says PM“

Frank Vargo is Vice President, International Economic Affairs, National Association of Manufacturers

• CTV, “Canada signs free-trade agreement with Colombia“: “Canadian Prime Minister Stephen Harper and Colombian President Alvaro Uribe signed a free trade agreement between the two countries while at the Asia-Pacific Economic Cooperation meeting in Lima Friday.”

• Japan Economic Newswire, “Japan, Colombia to start talks on investment pact“: “Japanese Prime Minister Taro Aso and Colombian President Alvaro Uribe agreed Saturday to launch talks on a treaty to increase protection of their bilateral investments, a Japanese official said.”

• AFP, “Bush asks US to look after ‘good friend’ Uribe“: “‘He is a strong leader. He’s a good friend. And our Congress and our government must never turn our back on a friend like Uribe,’ Bush said during a speech at an APEC summit in Lima that was his last foreign trip as US leader.”

• The Oregonian, “Keep the Faith with Colombia“: “The United States, and especially a trade-dependent state like Oregon, which sent more than $27 million in goods to Colombia last year, should welcome an improvement in the climate for selling goods to Colombia. And it should reward a friendly, effective government in Colombia for its support for American interests in South America.”

• AFP, “Chavez wins majority in key local test, opposition advances“:

“Who can say there’s a dictatorship in Venezuela?” Chavez said, in a jab at his many critics.

“A new stage is beginning. For me, as the leader of the Venezuelan socialist project, the people are telling me: ‘Chavez, keep on the same path,’” the anti-US leader said.

The polls were seen as a test for Chavez and his drive for nationalization and social projects, amid growing discontent over escalating crime, corruption and inflation.