Category: Press Releases and Statements

New Report Details WTO-Compatibility of Proposed U.S. Climate Change Legislation

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Washington, DC – On the heels of vigorous Congressional debate on proposed climate change legislation, the National Foreign Trade Council (NFTC) today released a new analysis, titled “WTO-Compatibility of Four Categories of U.S. Climate Change Policy,” which examines energy and climate related bills introduced in the 110th Congress from the perspective of their compliance with World Trade Organization (WTO) rules. The NFTC report also suggests that it is in the United States’ best interest as a global leader to develop climate change policies that are consistent with our multilateral obligations.

 
“Every nation has a stake in the environment, and the United States has a unique opportunity to lead the global community in developing international climate change law and regulations. We should begin by ensuring that U.S. policies are in accord with the WTO rules we and our trading partners have adopted,” said NFTC President Bill Reinsch. “As Congress debates climate change, it is important that policymakers understand that action will be most effective if it is multilateral and consistent with WTO rules.”
 
The NFTC report examines seven leading bills pending in the Congress based on the policy tools they employ, including energy efficiency regulations and standards/government-administered eco-labeling, subsidies to encourage climate-friendly investments, public procurement of climate-friendly goods and services, and emissions trading.
 
“The NFTC does not advocate a particular policy on climate change, but we strongly recommend that any action be WTO-compliant, and we point out clearly that early movers have a significant opportunity to shape the development of international rules in this area,” said Reinsch. “The United States must realize the importance of multilateralism and engagement with the rest of the world to develop climate change policy tools that can hold their own with respect to international law. It makes little sense to enact laws here that will only become the subject of WTO complaints by allied nations in the future.”
 
According to the analysis, the emissions cap-and-trade system proposed in S. 2191 may in theory be one of the most WTO-compatible policy tools, as emissions permits are not currently considered a “good” or “service.” The report cautions, however, that because such programs often involve government subsidies or require eco-labeling, their implementation may raise WTO concerns.
 
The detailed analysis also notes that the provisions for government procurement of climate-friendly goods included in H.R. 3221 do not appear to be in violation of the WTO Agreement on Government Procurement. However, subsidies for renewable energy included in the form of loan guarantees for renewable fuel facilities proposed in H.R. 6 are likely to violate the WTO Agreement on Subsidies and Countervailing Measures. Similarly, the report concludes that the government-administered eco-labeling also proposed in H.R. 6 may violate the WTO Agreement on Technical Barriers to Trade.
 
The report concludes, “In the end, passage of domestic legislation that is WTO-compliant will accelerate the meeting of U.S. national energy and climate change policy imperatives; will level uncertainties for U.S. enterprises, furthering their leadership in international commerce; and will give the United States a positive international reputation that could positively affect areas of diplomacy outside the sphere of climate change.”
 
For a complete copy of the report, please click here.

NFTC Applauds Senate Approval of Peru Trade Promotion Agreement

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Council Urges Action on FTAs with Colombia, Panama and South Korea

 
Washington DC – The National Foreign Trade Council (NFTC) today applauded the U.S. Senate for its bipartisan approval of the U.S.-Peru Trade Promotion Agreement (PTPA), and urged Congress to schedule procedural action and subsequent votes on pending agreements with Colombia, Panama and South Korea.
 
“Today’s Senate approval of the Peru agreement is an important milestone in our bilateral relations, and is evidence of the United States’ commitment to economic growth and development in Latin America,” said NFTC President Bill Reinsch. “With a growing ‘to-do’ list just weeks before adjournment, action on other pending FTAs seems unlikely, and so we urge Members to move ahead with timely consideration of the Colombia, Panama and South Korea agreements as soon as the Second Session of 110th Congress commences.”

 
The PTPA will allow for continued and increased market access for U.S. goods such as machinery, electronics, plastics and agricultural products, among others. In 2006, two-way trade between the United States and Peru reached $8.8 billion, with $2.9 billion of this coming from U.S. exports.
 
“Peru is a growing market for U.S. goods and services, and this FTA strengthens our existing trade partnership by expanding opportunities for U.S. industries and workers,” said Mary Irace, NFTC Vice President for Trade and Export Finance. “It is important to recognize that the U.S. market is already wide open to imports from Peru under existing US trade preference programs and generally low tariffs.The PTPA will change that by eliminating tariff and non-tariff barriers to our bilateral trade in both markets.The NFTC looks forward to its entry into force and also to Congressional action on the three other pending FTA agreements.”
 
While most Peruvian products already enter the United States duty-free under a number of trade preference programs, including the Andean Trade Preference Act, U.S. goods and services routinely face an average weighted tariff of nine to 10 percent. Under the terms of the agreement, 80 percent of U.S. consumer and industrial products and more than two-thirds of current U.S. farm exports will enter Peru duty-free immediately.

 
 
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Advancing Global Commerce for Over 90 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.

NFTC Commends House for Bipartisan Approval of U.S.-Peru Trade Agreement

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Council Urges Swift Senate Vote, Action on Pending Agreements

 
Washington DC – The National Foreign Trade Council (NFTC) today commended the U.S. House of Representatives for approving the U.S.-Peru Trade Promotion Agreement (PTPA), with a substantial number of Democrats and Republicans voting for the trade deal.

 
“We applaud the House for delivering a solid bipartisan vote on the Peru trade agreement, and look forward to similar action in the Senate in the next few days,” said NFTC President Bill Reinsch. “Strong support for the FTA on both sides of the aisle is the result of a lot of hard work on the part of the House leadership and the Administration to come together to craft a bipartisan U.S. trade agenda.”
 
Two-way trade between the United States and Peru reached $7.4 billion during 2005, with $2.3 billion of this coming from U.S. exports. The PTPA will allow for continued and increased market access for U.S. goods such as machinery, electronics, plastics and agricultural products, among others.
 
“Congressional approval of the PTPA will show our trading partners in Peru and the rest of the region that the United States values our commercial relations with Latin America,” said Mary Irace, NFTC Vice President for Trade and Export Finance. “Following final action on Peru, we look forward to timely consideration of the Colombia, Panama and South Korea FTAs.”
 

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Advancing Global Commerce for Over 90 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.

NFTC Applauds Conferees for Tabling Grassley/Sanders H-1B Visa

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Washington, DC – The National Foreign Trade Council (NFTC) today released the following statement, applauding House and Senate conferees for removing the Grassley/Sanders H-1B visa fee amendment from the Labor, Health and Human Services (HHS) and Education appropriations bill conference report. NFTC President Bill Reinsch released the following statement:

 
“We applaud the House and Senate Labor-HHS appropriations bill conferees for removing the Grassley/Sanders amendment from the conference report. The amendment would have imposed an unnecessary fee on U.S. companies seeking to attract and retain the best and brightest highly skilled, foreign-born professionals through the H-1B visa program.
 
“To remain competitive in the global marketplace, U.S. employers aggressively seek out top notch talent both domestically and from all around the world. The H-1B visa program, which currently fails to keep up with market demand, is in need of reform to ensure that employers have the ability to innovate and compete with firms worldwide.
 
“The fee hike proposed in the Grassley/Sanders amendment moves in the wrong direction. The measure would have led to a financial burden on companies of all sizes that already face visa shortages, green card backlogs and other impediments that deny them access to the world’s top talent, and it would have sent the message that America is closing itself off from talented people at the very time we need them the most as we face increasing competition globally.”

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Advancing Global Commerce for Over 90 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.

NFTC Urges Michigan State Lawmakers to Consider Consequences of Proposed Divestment Bill

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Says Legislation Undermines U.S. Foreign Policy, Harms Pensioners

 

Washington, DC – The National Foreign Trade Council (NFTC), a Washington, DC-based association of some 300 companies engaged in international trade and investment, earlier this week urged Members of the Michigan Legislature to oppose SB 846, which could require divestment from an array of companies with international operations. The NFTC sent a letter to all state lawmakers urging them to consider the bill’s potentially negative consequences, warning that the measure undermines federal foreign policy and puts state pensioners and U.S. companies at undue financial risk while having no effect on the behavior of targeted governments.
 
“The Framers of the Constitution put the power to conduct foreign policy in the hands of the federal government for a reason,” said NFTC President Bill Reinsch. “The ability of the United States to speak with a unified voice on matters of foreign relations is paramount to U.S. diplomacy. It is, at the very least, counterproductive to have 50 different states devising 50 different foreign policies.”
 
“Statutes aimed at affecting foreign policy at the state and local levels – as divestment seeks to do – threaten to create a complex web of restrictions and regulations that interfere with the Constitutional rights given to the President to largely conduct foreign policy,” wrote Reinsch in a letter to Michigan legislators. “State sanctions and divestment bills could impede various federal initiatives to develop a multilateral approach because their impact would fall primarily on companies located in the very countries whose support the President is seeking.”
 
Reinsch called on legislators to consider two important court decisions, including NFTC v. Crosby (2000) and NFTC v. Giannoulias (2007),a case in which the NFTC brought suit against Illinois over the state’s “Act to End Atrocities and Terrorism in Sudan.” The letter notes that on February 23, 2007, Judge Matthew Kennelly of the Federal District Court for the Northern District of Illinois ruled that the state’s law was “unconstitutional because ‘the Act violates federal constitutional provisions that preclude the states from taking actions that interfere with the federal government’s authority over foreign affairs and commerce with foreign countries.”
 
The NFTC pressed Michigan lawmakers to take a closer look at the lack of well-defined criteria that would be used to identify companies targeted for divestment. “There is no federal list to rely upon, and the available alternatives are highly subjective in terms of their accuracy and the breadth of companies they target. Additionally, some lists of companies are linked to organizations that have foreign policy motives that inform their work, which call into question their validity and the evenhandedness by which the organization evaluates ties to countries like Iran,” Reinsch wrote.
 
The letter also argues that not only are there no clear indications for how pension fund trustees are supposed to divest, “there appears to be no transparent process for trustees to decide which companies to divest from.” The letter contends that the bills’ broad divestment provisions could cost pensioners millions of dollars in transaction costs and threaten to “eliminate entire stock classes from the pool of potential investments, narrowing State pension fund managers’ choices and increasing the overall risk to the portfolio.”
 
Reinsch concluded, “Direct engagement – including utilizing direct diplomatic channels to governments in Iran and elsewhere – combined with efforts to engage our allies on concerted multilateral efforts are necessary to bring about the changes in behavior we all want to see. State sanctions impede this engagement, undermine the ability of the U.S. to speak with one voice, and frustrate cooperation with U.S. trading partners who often see them as a violation of U.S. international commitments.”
 
For a full copy of the letter, please click here.
 
 

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Advancing Global Commerce for Over 90 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.

NFTC Urges House to Pass Trade Adjustment Assistance Reform Bill

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Calls Legislation a Step Forward in Addressing U.S. Workers’ Concerns
 
Washington, DC – The National Foreign Trade Council (NFTC) today encouraged Members of the U.S. House of Representatives to approve H.R. 3920, the Trade and Globalization Assistance Act of 2007, being debated on the House floor this morning. NFTC President Bill Reinsch released the following statement:
 
“House passage of the H.R.3920 is an important step in the development of a national trade policy that promotes trade liberalization at the same time it addresses the concerns of the American workers who worry about losing their jobs.
 
“Everyone knows that trade promotes growth and jobs, but it also leaves victims in its wake.   Helping those that are left behind find new jobs and new careers has long been part of our trade policy but not one that we have handled well. 
 
“Although it is not without flaws, the House bill will make significant improvements in the existing TAA program, ease the anxieties of the growing number of Americans who worry about their future, and pave the way for House action on the four pending free trade agreements, which are another key part of a forward-looking trade policy.”
 
Advancing Global Commerce for Over 90 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.

NFTC Applauds Bipartisan Committee Approval of U.S.-PeruTrade Agreement

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Washington, D.C. – The National Foreign Trade Council (NFTC) today praised the House Ways and Means Committee for its overwhelming bipartisan approval (39-0) of the U.S.-Peru Trade Promotion Agreement (PTPA) during a markup held this morning. The committee’s action paves the way for a vote on the House floor as early as next week.

 
“Today’s Ways and Means Committee approval of the Peru legislation sends a clear message that there is strong bipartisan support for the trade agreement,” said NFTC President Bill Reinsch. “As the Peru agreement is the first in the series of pending agreements that implement the provisions of the May 10 agreement reached between the Administration and Congress, we urge the House to support it.”
 
“We hope that both the House and Senate will complete action on the Peru agreement within the next few days, and that Congress will then take up other important
FTAs awaiting approval,” said Mary Irace, NFTC Vice President for Trade and Export Finance.
 
The PTPA will expand market access for U.S. farmers and ranchers and open the Peruvian services sector to U.S.-based firms. In 2006, U.S. goods exports to Peru
totaled $2.9 billion, an increase of more than 25 percent from the previous year. The PTPA will allow for continued and increased market access for U.S. goods, including machinery, electronics, plastics and agricultural products.U.S. services suppliers also stand to gain in the areas of telecommunications, finance, energy, construction and transportation, among others.
 
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Advancing Global Commerce for Over 90 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.

NFTC Calls on Pennsylvania Legislators to Consider Negative Implications of Proposed Divestment Legislation

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Contends Bills Undermine U.S. Foreign Policy, Will Harm Businesses and Pensioners

Washington, DC – The National Foreign Trade Council (NFTC), a Washington, DC-based association of some 300 companies engaged in international trade and investment, today urged Members of the Pennsylvania General Assembly to reconsider bills – HB 1085, 1086 and 1087 – which could require divestment from a broad array of companies with international operations. In opposition to the proposed legislation, the NFTC sent letters to state lawmakers asking them to consider the bills’ potentially negative consequences, including that the measures undermine the federal government’s ability to conduct foreign policy, and put state pensioners and U.S. companies at undue financial risk, while having no effect on the behavior of targeted governments.”

“We’re seeing a proliferation of these measures at the State level, many of which have no regard for the level or type of business surrounding these countries of concern,” said NFTC President Bill Reinsch.”This should be alarming for any businesses engaged in international commerce and for pensioners whose retirement funds could be affected.”

“Statutes aimed at affecting foreign policy at the state and local levels – as divestment seeks to do – threaten to create a complex web of restrictions and regulations that interfere with the Constitutional rights given to the President to largely conduct foreign policy,” wrote Reinsch in a letter to Pennsylvania legislators. “Foreign policy sanctions by states not only undermine the ability of the U.S. to speak with one voice, but also frustrate cooperation with U.S. trading partners who often see them as a violation of U.S. international commitments.”

The NFTC pressed Pennsylvania lawmakers to take a closer look at ambiguous language included in the legislation, specifically the lack of well-defined criteria that would be used to identify companies targeted for divestment. “While this legislation purports to address business ties between companies and countries on the U.S. list of state sponsors of terrorism, the provisions are so broad and the legislation is so complicated as to affect hundreds of U.S. and foreign companies, including many whose supposed ties to these countries are variously tenuous, mischaracterized or legitimate under U.S. law,” Reinsch wrote.

“Most troubling, the bills appear to require divestment of investments in any company that does any amount of indirect business with targeted countries, including in instances where companies have no direct ties or contact with the offending countries. The United States will no doubt face vigorous complaints from our trading partners if it were to come into effect,” the letter reads.

The letter also argues that not only are there no clear indications for how pension fund trustees are supposed to divest, “there appears to be no transparent process for trustees to decide which companies to divest from.” The letter contends that the bills’ broad divestment provisions could cost pensioners millions of dollars in transaction costs and threaten to “eliminate entire stock classes from the pool of potential investments, narrowing State pension fund managers’ choices and increasing the overall risk to the portfolio.”

The NFTC also questioned how the state will target companies when no federal list exists, noting that even the U.S. Securities and Exchange Commission was forced to take down its own flawed list of companies.

For a full copy of the letter, please click here.

Advancing Global Commerce for Over 90 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.