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Visa Backlog Costs U.S. Exporters More than $30 Billion Since 2002, New Study Finds
Date: 6/2/2004

Business Groups Say Current Visa Delays
Severely Damage U.S. Companies, Foreign Policy

Washington, DC – Persistent problems in government handling of visas for foreign business travelers have cost U.S. exporters more than $30 billion in revenue and indirect costs since July 2002, according to a study released today by eight U.S. international business groups. The study surveyed a diverse group of small, medium and large companies from across the spectrum of U.S. industries, including technology, health care, pharmaceuticals, retail, energy, automobile, publishing, engineering/construction, airlines and financial institutions. The survey findings indicate that, though a wide range of U.S. businesses have been financially affected by visa backlogs, small to medium-sized exporters experience disproportionately severe losses.

"The effects of losing over $30 billion throughout our economy as a result of inefficient management of the visa processing system are staggering," said Bill Reinsch, President of the National Foreign Trade Council. "Our companies have expressed growing frustration to government officials and Congress for nearly two years over the broken business visa system, to no avail. Now that we have measured the costs, the results are clear: the U.S. cannot continue on this course. When legitimate foreign business executives and vital international customers cannot enter the U.S. to conduct normal business, it is our companies, our workers, our economy and our international relations that pay the price."

The survey data was gathered and analyzed by The Santangelo Group, an independent research firm, on behalf of the Aerospace Industries Association (AIA), the American Council on International Personnel (ACIP), the Association for Manufacturing and Technology (AMT), the Coalition for Employment Through Exports (CEE), the National Foreign Trade Council (NFTC), the US-China Business Council (USCBC), the U.S.-Russia Business Council (USRBC) and the U.S.-Vietnam Trade Council (USVTC).

Companies responding to the survey enumerated the financial impact of the visa backlog in two categories: revenue loss and indirect expenses. Statistical analysis indicates that the impact on all U.S. exporters would total more than $30 billion.

Of the companies sampled:

  • 73% currently experience, or have recently experienced, problems in the processing of business travel visas (including unexpected delays and arbitrary denials)
  • 60% reported they had suffered a "material impact" from business travel visa processing delays, including lost sales, increased costs, need to relocate people or functions offshore, etc.
  • 51% report that the visa process is worse today than it was one year ago

The survey concluded that the financial impact of visa delays hits medium-sized companies the hardest, directly contributing to 54% of total revenue losses and 65% of total indirect costs.

"While tighter visa restrictions were put in place with the best of intentions, the restrictions' negative impact on both our economy and our trade deficit cannot be ignored," said Ed Rice, President of the Coalition for Employment through Exports. "In fact, our report shows that the losses resulting from visa delays go well beyond lost revenues, with the unexplained and arbitrary denials escalating to cost U.S. companies much more. Key contracts and projects will go elsewhere; U.S. companies will increasingly move research and other facilities overseas; and, perhaps most troubling for the American entrepreneur, U.S. small businesses will pull back from international business development for fear that visa red tape will pose unmanageable obstacles."

RECOMMENDATIONS

  • The goal for visa processing should be 48 hours with an outside limit of 30 days;
  • Consular posts should provide greater transparency to U.S. companies;
  • A "Gold Card" program would facilitate visa applications and avoid problems and redundancies before they occur;
  • Continued integration of government databases is essential;
  • Multiple-entry, longer duration visas would lessen consular workloads;
  • Consular posts should allow interviews to be scheduled over the Internet;
  • Congress should exercise its oversight authority to ensure improvements in consular services.

"There are ways to make the visa system more efficient and transparent without compromising our need for a secure America. Let's provide a level playing field for U.S. companies to compete, just as we have before. To remain competitive in the global marketplace, we cannot afford more losses due to a visa system that is overwhelmed," concluded Lynn Shotwell, Legal Counsel and Director of Government Relations, American Council on International Personnel.

A full copy of the visa survey is available at http://www.nftc.org/default/visasurveyresults%20final.pdf and to view the "Recommendations for Ameliorating Impact of Visa Delays" go to http://www.nftc.org/default/visasurveyrecommendations%20604.pdf

 


The American Council on International Personnel, Inc. (www.acip.com) is a leading not-for-profit professional association dedicated to facilitating the international movement of personnel. Founded in 1972, ACIP is committed to maintaining its position as the preeminent voice on issues affecting the mobility of highly educated professionals across international borders for its over 250 corporate and institutional members.

 

The National Foreign Trade Council (www.nftc.org) is a leading business organization advocating an open, rules-based global trading system. Founded in 1914 by a broad-based group of American companies, the NFTC now serves 300 member companies through its offices in Washington and New York.

The US-China Business Council is the principal organization of US corporations engaged in business relations with the People's Republic of China. Founded in 1973, the Council serves several hundred leading US companies from its Washington, DC headquarters and field offices in Beijing and Shanghai.

The U.S.-Russia Business Council (USRBC) is a Washington-based trade association that represents the interests of 300 member companies operating in the Russian market. The Council's mission is to expand and enhance the U.S.-Russian commercial relationship. Guided by member interests, the Council promotes an economic environment in which businesses can succeed in a challenging Russian market. Through a range of activities, the Council contributes to the stability and development of a free market in Russia and supports Russia's integration into the global economy. For more information, please visit www.usrbc.org.

The Santangelo Group is an international business and economic development consulting firm based in Washington, DC, comprised of former U.S. government officials and Fortune 500 executives. More information about the firm is available at www.SantangeloGroup.com.