Category: Press Releases and Statements

NFTC Opposes Revenue Offset Provisions Included in Tax Extender Legislation

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Argues Proposals will Undermine Competitiveness of Worldwide American Companies

Washington, DC – The National Foreign Trade Council (NFTC) today released a position paper detailing its opposition to the revenue offset provisions included in the extender legislation being considered by Congress. The paper, which expresses support for the inclusion of the look-through rule and subpart F provisions that expired last year, focuses primarily on three international tax provisions which would undermine the competitiveness of worldwide American companies – the foreign tax credit splitter provision, the Section 338 covered asset acquisition proposal and the limitation on the use of Section 956. The NFTC argues that these proposed changes to the U.S. international tax system, to be applied retroactively, are unfair and will make it more difficult for worldwide American companies to compete internationally.

In the NFTC paper sent today to all members of the House Ways and Means and Senate Finance committees, the association stated the following:

“…The revenue offsets included in the extender legislation were developed in closed door meetings without input from the affected taxpayers. The U.S. international tax rules are complex and increasingly out of step with the rest of the world. These new revenue proposals will make American businesses less able to compete in foreign markets, will subject them to double taxation, and as a result may have significant negative consequences on worldwide American businesses and their U.S. employees.

“…In addition, the provisions are retroactive and will affect taxpayers who have relied on long standing rules in the tax code in doing their tax planning. Taxpayers need to be able to rely on certainty of tax rules when making business decisions, and the retroactive application of adverse tax changes is unfair and will make it more difficult for American worldwide companies to compete in the global marketplace.

“…These international tax revenue raisers should be thoughtfully considered only in the context of tax reform rather than as piecemeal permanent revenue raisers for short term extensions of expiring tax provisions.

“…The effective dates included in the legislation penalize taxpayers who have acted in good faith and who have relied on the current tax code in planning their transactions. If Congress unadvisedly enacts these proposals without careful deliberation of the long term ramifications, it should at the very minimum make the effective date of these proposals prospective for taxable years beginning on or after December 31, 2010. Otherwise, American companies would unfairly face retroactive tax increases that would break long-standing tax policy that strongly favors making tax increases prospective only.”

 

To read the full paper, please click here

About the NFTC
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 hundreds of member companies through its offices in Washington and New York.
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Washington, DC & Research Triangle Groups Collaborate on Innovation Policy Recommendations to President Obama, Governor Perdue

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Innovation stakeholders suggest global mobility, trade policies key to creating U.S. jobs
 
 
Washington, DC – In letters sent today to President Obama and North Carolina Governor Beverly Perdue, National Foreign Trade Council Foundation (NFTC Foundation) President Bill Reinsch and Research Triangle Foundation President & CEO Rick Weddle outlined a series of recommendations for leveraging public policy to expand U.S. exports, encourage innovation and create high-wage jobs across the country. The recommendations were developed during a one-day workshop hosted by the NFTC Foundation’s Global Innovation Forum in partnership with the Research Triangle Foundation on April 16, which brought together a broad range of innovation stakeholders, including more than 20 CEOs, 90 inventors, academics, non-governmental organizations, and state and federal policymakers.

During the event, which was held in Research Triangle Park, North Carolina, attendees identified several areas of concern for U.S. businesses, workers and entrepreneurs, including global trade barriers, counterfeiting and piracy, access to capital and cultivating and retaining entrepreneurs, innovators and talented employees. Immigration and visa policies were particularly high on the list of concerns of local business leaders. Based on the discussion, the letter details five key areas of focus for public policy, including: 
 

  • Improving U.S. immigration and global mobility policies; 
  • Creating a more open, rules-based, competitive trading environment by aggressively pursuing new trade agreements and enforcing existing regulations; 
  • Promoting the importance of the intellectual property rights system as a means to encourage innovation and provide a framework for advanced research collaboration and technology sharing;
  •  Improving access to capital, particularly for innovative small businesses and entrepreneurs; and
  •  Supporting efforts by emerging innovators, entrepreneurs and small businesses to engage the public policy process.
     
“We hope this feedback will be useful as you prioritize efforts to shape national innovation and trade policies to support your ambitious goal of doubling exports in five years,” wrote Reinsch and Weddle in the letter sent to the President.

The Research Triangle Park event was the first in a series of innovation policy discussions to be held around the country, made possible thanks to a grant from the GE Foundation to the NFTC Foundation. The next innovation discussion will take place at the Palo Alto Research Center in Palo Alto, California.

In addition to the Research Triangle Foundation, the North Carolina forum was held in partnership with the Nicholas Institute for Environmental Policy Solutions of Duke University, the Council for Entrepreneurial Development, the North Carolina Biotechnology Center and the North Carolina Sustainable Energy Association. In addition to the GE Foundation, Progress Energy, GlaxoSmithKline, ABB, IBM and Cisco also helped sponsor the event.

To read the letters, please click here.

About NFTC, NFTC Foundation and the Global Innovation Forum

The National Foreign Trade Council, founded in 1914 and headquartered in Washington, DC, with offices in New York City, is the oldest and largest trade association devoted entirely to advocating an open, rules-based international trade system. NFTC promotes open markets and U.S. engagement in the world on behalf of its member companies, which include Boeing, Caterpillar, Chevron, General Electric, Hanes Brands, IBM, Microsoft, Oracle, United Technologies and Wal-Mart.

Incorporated in 1979, the National Foreign Trade Council Foundation is the educational arm of the NFTC. It is a 501(c)(3) organization incorporated under the laws of the state of New York. The NFTC Foundation’s mission is to inspire, encourage and facilitate international trade and investment in order to enhance economic growth and job creation throughout the world.

The Global Innovation Forum is a project of NFTC’s educational arm, the NFTC Foundation. NFTC established the Global Innovation Forum to create a greater understanding of how public policy that supports the innovation ecosystem can improve the lives of workers, families and communities around the world. Through educational events and workshops, the Global Innovation Forum brings together diverse groups of innovation stakeholders to bridge differences, build consensus and create solutions to common challenges.

NFTC, USA*Engage Welcome Multilateral Agreement on UN Security Council Iran Sanctions Resolution

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Washington, DC – The National Foreign Trade Council (NFTC) and USA*Engage today welcomed news from the Obama Administration regarding an agreement reached with Russia and China on a draft UN Security Council resolution calling for multilateral sanctions against Iran. The two organizations released the following statement.

“We applaud the Administration’s success in reaching agreement with Russia and China on a draft UN Security Council sanctions resolution. As we’ve stated repeatedly, only multilateral economic sanctions have a legitimate chance to influence the Iranian regime. Unilateral sanctions shut out the international community rather than encourage cooperation,” said NFTC President and USA*Engage Co-Chair Bill Reinsch.

“We continue to believe that unilateral economic sanctions do not work and indeed often only harm U.S. economic interests. That said, we recognize that House and Senate conferees now engaged in completing Iran sanctions legislation are committed to passing additional U.S. unilateral sanctions. We urge them to target the legislation to identified bad actors and not penalize U.S. companies or U.S. subsidiaries of foreign companies with no direct ties to Iran’s energy sector. Attempting to repeal the global supply chain will not add to the multilateral effort and will only hurt the U.S. economy,” said Richard Sawaya, USA*Engage Director.

About USA*Engage

USA*Engage (www.usaengage.org) is a coalition of small and large businesses, agriculture groups and trade associations working to seek alternatives to the proliferation of unilateral U.S. foreign policy sanctions and to promote the benefits of U.S. engagement abroad. Established in 1997 and organized under the National Foreign Trade Council (www.nftc.org), USA*Engage leads a campaign to inform policy-makers, opinion-leaders, and the public about the counterproductive nature of unilateral sanctions, the importance of exports and overseas investment for American competitiveness and jobs, and the role of American companies in promoting human rights and democracy world wide.

AboutNFTC

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 hundreds of member companies through its offices in Washington and New York. 
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NFTC Urges President Obama to Send Pending FTAs to Congress This Year

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Washington, DC – On the three-year anniversary of the bipartisan May 10 agreement on trade, the National Foreign Trade Council (NFTC) today urged President Obama to follow through on his State of the Union address pledge to strengthen trade relations with Colombia, Panama and South Korea. NFTC President Bill Reinsch released the following statement:

“By expanding market access in Panama, Colombia and South Korea, we have an opportunity to grow American exports, create U.S. jobs and generate economic opportunity for our companies, which employ millions of hard-working Americans every day.

“Global trade and the pace of international business require that the United States be aggressive in seeking new markets to sell American good and services. As our competitors seize opportunities to expand market share in these countries – displacing U.S. farmers, ranchers, service providers and manufacturers – we are standing still.

“Three years have passed since a Democratic Congress and a Republican administration agreed to a bipartisan framework for America’s trade agenda. We cannot afford to let another year pass, waiting for the most politically opportune time to consider and approve these agreements, as the economic costs of inaction grow.

“The May 10, 2007, agreement was not perfect — it included provisions that significantly weaken intellectual property rights protection for U.S. firms — but it did provide a bipartisan framework for proceeding on the U.S. trade agenda. With that, and the strong economic arguments for action, the only thing missing is political will.

“We either seize this moment to increase exports and maximize job creation, or we continue to see our market share decline as competitor nations gladly take our seat at the trading table.

“By sending these export-promoting, job-creating agreements to Congress for an up-or-down vote, the President can send a message that America is indeed open for business. Now is the time to move forward.”

About the NFTC

Advancing Global Commerce for 95 Years – 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 hundreds of member companies through its offices in Washington and New York. Follow us on:

 

 

Former WTO Ambassador Stuart Harbinson To Serve as Chief Advisor to NFTC’s WTO Working Group

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Washington, DC – The National Foreign Trade Council (NFTC) today announced that Ambassador Stuart Harbinson will serve as the representative and chief advisor to the Council’s WTO Project in Geneva, Switzerland, in his capacity as senior trade policy advisor at Winston & Strawn LLP. As the successor to Ambassador John Weekes – who retired after serving for eight years as the NFTC’s WTO advisor – Harbinson brings to the NFTC decades of senior-level experience in international trade and WTO-related issues.

“We are very pleased to welcome Ambassador Harbinson as our representative in Geneva, and we have no doubt that he will provide invaluable leadership to our WTO Working Group,” said NFTC President Bill Reinsch. “Ambassador Harbinson has been an ardent supporter of the rules-based trading system and we value his commitment to the successful conclusion of the Doha Round and to the advancement of global economic growth.”

As senior trade policy advisor to Winston & Strawn, Ambassador Harbinson advises the firm’s international trade lawyers on all trade policy issues, with a focus on cases involving the World Trade Organization. He has served as a senior-level WTO official in a variety of capacities, including as former special adviser to Director-General Pascal Lamy and as chief of staff to Director-General Supachai Panitchpakdi. He previously represented Hong Kong as ambassador to the WTO for eight years and was elected several times as chairman of various important WTO bodies, including its overarching General Council. Harbinson has extensive experience overseeing both Doha Round preparation discussions and participating in WTO dispute settlement panels.

Immediately prior to joining Winston & Strawn, Harbinson served as senior trade advisor to the Secretary-General of the United Nations Conference on Trade and Development, where he provided strategic advice aimed to facilitate cooperation between the UN and the WTO.

“We value Ambassador Harbinson’s public service and his extensive knowledge of the WTO,” said NFTC Vice President for Global Trade Issues Jake Colvin. “We look forward to working with Ambassador Harbinson to advance U.S. business interests in supporting the rules-based trading system.”

For more information about the NFTC’s WTO Working Group, visit: http://www.nftc.org/?id=246&cat=Issues_WTOIssues.

About the NFTC
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 hundreds of member companies through its offices in Washington and New York.

Coalition for Security and Competitiveness Statement on Secretary Gates’ Export Control Remarks

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Washington, DC – The Coalition for Security and Competitiveness (CSC) today released the following statement in response to U.S. Secretary of Defense Robert Gates’ remarks on export control reform.

“Export control modernization is essential to better protecting our national security and helping our critical technology industries maintain their long term competitiveness. The Coalition welcomes the Administration’s commitment to export control modernization and the hard work it has undertaken to develop its proposals.

“The Administration’s plan will go a long way toward achieving those goals. Particularly important are meaningful list review and reduction and agreement on how to resolve jurisdictional issues between the State and Commerce Departments.

“We support the Administration’s sequencing plan, which begins with the most difficult issues and then moves on to agency reorganization. CSC believes that a phased approach that begins with the most important issues is the one most likely to achieve lasting success. We appreciate the Secretary’s acknowledgement of the structural challenges associated with the reforms he outlined today.

“We also believe genuine progress in implementing reforms will require the continued leadership of Secretaries Gates, Clinton and Locke and General Jones. CSC looks forward to hearing more from the Administration on implementing many of the near and medium-term reforms we proposed earlier this year.”

The Coalition’s member associations include the Aerospace Industries Association, the Association of American Exporters and Importers, the AMT – Association for Manufacturing Technology, The Business Roundtable, the Coalition for Employment Through Exports, the General Aviation Manufacturers Association, the Industrial Fasteners Institute, the Information Technology Industry Council, the National Association of Manufacturers, the National Defense Industrial Association, the National Foreign Trade Council, the Satellite Industry Association, the Space Enterprise Council, The Space Foundation, TechAmerica and the U.S. Chamber of Commerce.

About the Coalition

The Coalition for Security and Competitiveness was launched in March 2007, with an eye toward enhancing U.S. security and competitiveness through modernization of the export control system. The US needs an export control regime that is rigorous, transparent, predictable and efficient in order to meet the security and economic challenges of the 21st century. The Coalition’s member associations include the Aerospace Industries Association, the Association of American Exporters and Importers, the AMT – Association for Manufacturing Technology, The Business Roundtable, the Coalition for Employment Through Exports, the General Aviation Manufacturers Association, the Industrial Fasteners Institute, the Information Technology Industry Council, the National Association of Manufacturers, the National Defense Industrial Association, the National Foreign Trade Council, the Satellite Industry Association, the Space Enterprise Council, The Space Foundation, TechAmerica and the U.S. Chamber of Commerce. More information about the coalition can be found at www.securityandcompetitiveness.org.

NFTC’s Global Innovation Forum Hosts Conference on Role of Innovation Policy in Growing Exports, Creating Jobs in North Carolina

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Washington, DC – The National Foreign Trade Council’s Global Innovation Forum (GIF) hosted a one-day workshop and conference, themed “Going Global to Support North Carolina Innovation,” on April 16 in Research Triangle Park, North Carolina. The event, which brought together a broad range of innovation stakeholders, was aimed at developing a targeted set of recommendations to generate innovative solutions to global challenges, expand U.S. exports abroad and create high-wage jobs in North Carolina.

“Innovation fuels the U.S. economy and drives America’s global competitiveness,” said NFTC Vice President for Global Trade Issues Jake Colvin. “As U.S. companies and policymakers look increasingly to foreign markets to sustain jobs in America, this event marks the beginning of an ongoing national conversation NFTC has planned with senior public and private sector leaders about the role of public policy in promoting jobs and economic growth.”

Nearly 100 attendees – from inventors, academics and representatives of non-governmental organizations to CEOs, entrepreneurs and state and federal policymakers – participated in the forum. The conference featured keynote remarks by North Carolina Senator Kay Hagan and included three panel discussions and a workshop led by twenty senior business and thought leaders from Washington, DC and North Carolina.

Consensus formed around several key recommendations for public policy, including establishing better global rules and agreements for transparent and open markets, reforming U.S. immigration and visa policies, protecting U.S. intellectual property (IP) rights in foreign markets, and improving access to capital for entrepreneurs and small businesses. NFTC will present a summary of the recommendations to the officials responsible for innovation and export policies in the Offices of Governor Bev Perdue and the Obama Administration.

“We must continue to build our state into an innovation hub that produces goods and services valued in a global economy,” Senator Hagan said in her keynote remarks. “North Carolina is already home to some of the world’s most important innovations in the biotech, pharmaceutical, defense and IT fields, and we are well positioned to lead the country in the emerging clean energy sector. Investing in these fields will not only put our state at the forefront of cutting-edge technology and research, but also bring high-tech, high-paying jobs to North Carolina.”

The forum was held in partnership with the Research Triangle Foundation, the Nicholas Institute for Environmental Policy Solutions of Duke University, the Council for Entrepreneurial Development, the North Carolina Biotechnology Center and the North Carolina Sustainable Energy Association. Sponsors included the General Electric Foundation, Progress Energy, GlaxoSmithKline, ABB, IBM and Cisco.

“By bringing together a diverse group of stakeholders, this event provided an opportunity to advance the discussion about how innovation policy can help achieve the goals of increasing U.S. exports to markets around the globe and creating jobs for America’s workforce,” said John Stubbs, Executive Director of the Global Innovation Forum.

About NFTC and the Global Innovation Forum

The National Foreign Trade Council was founded in 1914 and is the oldest and largest trade association devoted entirely to advocating an open, rules-based international trade system. NFTC promotes open markets and U.S. engagement in the world on behalf of its member companies, which include Boeing, Caterpillar, Chevron, General Electric, Hanes Brands, IBM, Microsoft, Oracle, United Technologies and Wal-Mart.

The Global Innovation Forum is a project of NFTC’s educational arm, the NFTC Foundation. NFTC established the Global Innovation Forum to create a greater understanding of how the innovation ecosystem and public policy can improve the lives of workers, families and communities around the world. Through educational events and workshops, the Global Innovation Forum brings together diverse groups of innovation stakeholders to bridge differences, build consensus and create solutions. Its aim is to arrive at public policy solutions that support entrepreneurism, investment, development, trade, transfer and deployment of innovation and enable solutions to common challenges.

Leading U.S. Business Associations Endorse Cuba Travel Bill

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Washington, DC – The National Foreign Trade Council (NFTC) and USA*Engage today spearheaded a letter on behalf of the business community, expressing strong support for H.R. 874, the Freedom to Travel to Cuba Act. The letter, which was signed by eight other leading business associations, urged Members of Congress to pass the bill and remove all restrictions on travel by U.S. citizens.

In a letter delivered today to all Members of Congress, the associations stated:

“…The United States should immediately remove travel restrictions and allow Americans to act as ambassadors of freedom and American values to Cuba. From farmers and manufacturers to human rights and religious groups, as well as a large and growing number of Cuban Americans, the American people recognize the unfairness and incongruity of restricting travel to Cuba. It is simply wrong that American citizens cannot travel freely to Cuba but are not restricted by the United States from traveling to places like North Korea and Iran.

“Current policies towards Cuba have clearly not achieved their objectives. Without the support of our allies and the larger international community, U.S. sanctions serve only to remove the positive influences that American businesses, workers, religious groups, students and tourists have in promoting U.S. values and human rights. Sanctions are also blunt instruments that generally harm the poorest people of the target country rather than that country’s leaders.”

 


In addition to the NFTC and USA*Engage, the letter was signed by AdvaMed, the Coalition of Service Industries, the Emergency Committee for American Trade, the Organization for International Investment, the U.S. Chamber of Commerce and the U.S. Council for International Business.


“It is counterproductive to restrict the rights of American citizens to travel to Cuba, and Congress ought to fix this anomaly in U.S. foreign policy,” said NFTC Vice President for Global Trade Issues Jake Colvin. “Reversing the travel ban would act as a catalyst for citizen diplomacy by promoting goodwill and understanding between the people of Cuba and the United States.”

For a copy of the letter, please click here.

###

About USA*Engage

USA*Engage (www.usaengage.org) is a coalition of small and large businesses, agriculture groups and trade associations working to seek alternatives to the proliferation of unilateral U.S. foreign policy sanctions and to promote the benefits of U.S. engagement abroad. Established in 1997 and organized under the National Foreign Trade Council (www.nftc.org), USA*Engage leads a campaign to inform policy-makers, opinion-leaders, and the public about the counterproductive nature of unilateral sanctions, the importance of exports and overseas investment for American competitiveness and jobs, and the role of American companies in promoting human rights and democracy world wide.

About the NFTC

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 hundreds of member companies through its offices in Washington and New York.
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NFTC Urges Secretary Vilsack to Increase Sugar Import Quota, Asks Congress to Press for Reform

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Washington, DC – The National Foreign Trade Council (NFTC) today sent a letter to U.S. Department of Agriculture Secretary Tom Vilsack, urging him to increase the sugar import quota immediately to alleviate the cost burden on consumers and industrial users. The NFTC also sent a letter to all Members of Congress to request their help in pressing the Secretary to reform U.S. sugar policy without delay.

In the letter addressed to Secretary Vilsack, NFTC President Bill Reinsch wrote:

“As an organization that promotes U.S. exports and the benefits of open trade, the National Foreign Trade Council has long been concerned about the impact of U.S. sugar policy on consumers, businesses and workers. Today, those concerns are heightened by short supplies of sugar and exorbitant prices for consumers and industrial users….

“…Even though world sugar prices are higher than normal, U.S. prices are even higher. This means that the pressure on American consumers could be alleviated if world sugar supplies could be imported freely. But they cannot be: U.S. law sets quotas for sugar imports from some 40 different countries. Any imports in excess of these quotas are subject to an extremely high, normally prohibitive tariff.

“These high tariffs have always been justified as a way of protecting U.S. sugar farmers from low world prices. The rationale was that world sugar prices are so low that our sugar farmers and processors could not survive if they had to sell at the world price. Now, however, world prices are much higher than the historical norm….

“…There is a simple way to alleviate the strain on consumers, businesses and their employees, and it requires no new legislation. You have the ability to increase the tariff rate quota for sugar imports immediately, in any amount you choose. We respectfully urge you to provide immediately for an increase in raw and refined sugar tariff rate quotas that will allow stocks to return to a normal level.”
 

To read the NFTC letter to Secretary Vilsack, click here.
To read the NFTC letter to Members of Congress, click here.

About the NFTC

Advancing Global Commerce for 95 Years – 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 hundreds of member companies through its offices in Washington and New York.
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New Study Details Chinese Government Policies to Promote Domestic Renewable Energy Sector & Implications for Foreign Firms

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Washington, DC – The National Foreign Trade Council (NFTC) today released a new study, titled China’s Promotion of the Renewable Electric Power Equipment Industry: Hydro, Wind, Solar and Biomass, which examines policies put in place by the Chinese government to promote the development of its renewable energy sector. The study, authored by members of the International Trade Group of Dewey & LeBoeuf LLP, details a series of Chinese government measures that have stimulated demand for Chinese-made renewable energy equipment. These measures include preferential financing; VAT rebates; tax incentives; procurement preferences for Chinese-owned and controlled companies; local content preferences; and R&D subsidies for renewable energy equipment producers. The study also highlights foreign producers’ responses to these measures.

The study, written by Thomas Howell, William Noellert, Gregory Hume and Alan Wolff, chronicles Chinese government policies put in place between 2002 and 2009 to encourage the development of the domestic renewable energy sector, including:

The 2002 Government Procurement Law, which provided that with a few exceptions procurement purchases by government organizations should be limited to domestically-made goods;
  • The National Development and Reform Commission’s (NDRC) 2005 Notice of Requirements for the Administration of Wind Power Construction, which provided that no wind farm could be constructed in China that did not meet a 70 percent local content requirement;
  • The 2006 Renewable Energy Law, which was amended last year to require utilities to purchase all renewable power generated in China;
  • The 2006 Provisional Measures for the Accreditation of National Indigenous Innovation, which provided for a process under which products made with Chinese intellectual property could qualify for “priority” in government procurement;
  • The Medium and Long-Term Development Plan for Renewable Energy in China released by the NDRC in 2007, which triggered a surge of investment in the country’s wind equipment industry;
  • The 2008 Stimulus Package, which required that with respect to stimulus spending, preference be given to domestic products for renewable energy projects; and
  • The 2009 Golden Sun Demonstration Program, which will provide investment subsidies equal to 50 percent of the investment cost for grid-connected solar power systems.
The study puts these policies in context, noting that rising energy consumption coupled with the fact that China’s oil and natural gas reserves will be depleted in two decades at current extraction rates, have made it necessary for the country to develop renewable energy sources. Prior to the implementation of the policies mentioned above, “China imported much of the generating equipment used to construct its hydropower infrastructure, and until very recently China relied heavily on foreign equipment and technology.” Moving forward, “Chinese planners have indicated their intention that eventually most or all of the renewable energy equipment installed in China will be made in China, will be based on Chinese-owned intellectual property, and will embody Chinese-developed standards.”

In addition, the study points out that “although governments in the United States, Canada, Europe and Japan have introduced policies to promote renewable industries, China’s effort is noteworthy for its sheer scale and the speed with which it is being implemented.”

The study concludes by noting, “where questions of market access through trade and investment arise, the policies described above, whether practiced by China or in similar forms by its trading partners, will shape both others’ national policy decisions with respect to trade and investment, as well as emerging global rules on these subjects… Massive investment, major initiatives, and measures affecting trade and investment in a major country always result in substantial changes in trade flows and patterns of investment that might otherwise prevail.”

“While the study makes no findings about whether the Chinese government’s implementation of policies that favor its energy sector violate international trade rules, it does make clear that Chinese firms stand to gain substantially from these measures. The facts the study presents raise serious policy issues for China’s trading partners,” said NFTC President Bill Reinsch. “With strong potential growth in the U.S. renewable energy sector, this is an important emerging issue to watch.”

For a copy of the study, please click here.

About the NFTC

Advancing Global Commerce for 95 Years – 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 hundreds of member companies through its offices in Washington and New York.
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