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President’s Export Council Calls for Action on TPA, Rules of Origin, Export Licensing, Etc.

Friday, January 02, 2015
Sandler, Travis & Rosenberg Trade Report

The President’s Export Council recently submitted to the president its mid-term report outlining achievements and recommendations in the areas of global competitiveness, export promotion and advocacy, export administration, manufacturing, services and others. Highlights of this report include the following.

TPA. The Obama administration should continue to work directly with Congress to ensure passage of trade promotion authority at the earliest opportunity, establishing the necessary mandate and process for the broader U.S. trade agenda, including emerging areas of trade concerns such as localization barriers to trade, strengthening protections for trade secrets, and restrictions on digital trade, including legitimate cross-border data flows.

Africa. In support of renewing the African Growth and Opportunity Act before its September 2015 expiration, Congress and the administration should work actively with the private sector to ensure that AGOA appropriately focuses on commercial priorities, including those identified at the August 2014 U.S.-Africa Leaders Summit. The administration should also prioritize Africa's critical energy and infrastructure challenges, including Africa energy legislation, and encourage African countries to implement the WTO Trade Facilitation Agreement. Resources should be directed to the U.S. Trade and Development Agency’s Global Procurement Initiative: Understanding Best Value, to further educate public procurement officials in African countries about sustainable practice and policies that integrate life cycle cost analysis and best-value determination.

Infrastructure.  The administration should set an ambitious goal of upgrading the nation’s aging infrastructure network, as roads, rail lines, energy grids, pipelines, ports, airports and border crossings are aging and non-competitive globally. Better infrastructure would expand long-term productive capacity and reduce the all-in cost of U.S. goods and services, making U.S. products more competitive globally and helping to drive U.S. exports. The administration should take a strategic approach and actively coordinate upgrades of infrastructure across key sectors, such as energy, transportation, digital communications, water and the environment.

Open Skies Agreements. The administration should embark on pursing more open skies agreements and open up additional flight routes between the United States and other nations with the goal of bringing down barriers to travel and trade.

Regulatory Standards. Because a number of countries have started to pursue policies to prevent the sale of products manufactured to U.S. standards or to leverage regulatory differences to impede market access, the administration to promote the acceptance of U.S. standards in foreign markets and continue to lead efforts to promote regulatory cooperation practices.

SME Exporters. The administration should lead U.S. trading partners on new thinking to promote trade among small, technology-enabled exporters; e.g., through harmonization and simplification of international customs, liability and consumer redress policies. Also, a whole of government approach should be taken domestically to increase collaboration among U.S. agencies and ensure that federal trade tools, promotion programs and resources cater to the unique needs of these SMEs.

Regional/Metro Export Initiatives. The administration should develop a sustainable, networked platform to accelerate coordination and unification of existing local, state, regional and federal export resources and connecting them with SMEs. The administration should also explore utilizing the Small Business Administration as a central catalyst uniting the broad range of export resources − from the International Trade Administration, Ex-Im Bank, USTDA and Overseas Private Investment Corporation to regional nonprofits, educational institutions and private-sector companies. Regional and metro-level coordination and harmonization of export resources and programs available to SMEs is critically needed.

Rules of Origin. The administration should increase efforts to streamline and standardize rules of origin between various countries as free trade agreements are initiated, negotiated and developed. A clear mechanism should be in place for U.S. exporters to access country-by-country existing rules of origin to ease access to export information. Work should accelerate with the WTO’s Committee on Rules of Origin, which met in October to conduct its first review of new developments on preferential rules of origin for least-developed countries.

North American Competitiveness. Harmonizing trusted trader programs between Canada and the United States, an initiative that has been set in motion but has yet to be realized, would help improve North American trade and supply chains. Under the U.S.-Canada Regulatory Cooperation Council, more progress is needed to harmonize the safety standards for food, auto vehicles, consumer products and other commodities. The same bilateral approach to regulatory cohesion is needed with Mexico, and where possible regulations related to customs, food, health, safety, consumer and security requirements should be harmonized. Agency certifications should be bilateral tending to mutual recognition. Rules that prioritize regional content rather than national content should be enacted.

Single IT System. Completing the move of the remaining departments and agencies involved in export licensing to USEXPORTS, the single information technology system, will streamline the licensing process and introduce commonality between the agencies that will improve regulatory clarity and reduce the interpretive burden, particularly on SME exporters.

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