U.S. - Singapore Relations
U.S. Singapore Free Trade Agreement
Byliner: Zoellick Says U.S. Trade Strategy Maintains Momentum Toward Openness
10 July 2003
(U.S. Trade Representative op-ed article in The Wall Street Journal)
(1080)
(This op-ed by Robert Zoellick, U.S. Trade Representative, was
published in the Wall Street Journal July 10, and is in the public
domain. No republication restrictions.)
(begin byliner)
Our Credo: Free Trade and Competition
By Robert Zoellick
In early September, representatives from 146 countries that comprise
the World Trade Organization will assemble in Cancun to determine the
course of global trade negotiations. At this point, the meeting seems
more likely to highlight differences than agreements. One concerned
observer, Prof. Jagdish Bhagwati of Columbia and the Council on
Foreign Relations, wrote on these pages last week that the U.S. should
respond to this risk by forgoing our other efforts to open markets.
This course would both weaken our hand in the WTO and give up the
benefits from advancing free trade on multiple fronts.
The Bush administration's reinvigoration of America's drive for free
trade -- globally, regionally, and with individual countries -- has
created a momentum that strengthens U.S. influence. It is a little
puzzling to read criticism of this administration for negotiating too
many international agreements to advance economic growth, development
and the rule of law!
The president's strategy has already produced results. Congress
restored the executive's trade negotiating authority after an
eight-year lapse, demonstrating a united commitment to new global
trade negotiations. Simultaneously, the U.S. helped launch these
negotiations in Doha in 2001, reversing the prior debacle in Seattle.
And we completed the stalled effort to bring China and Taiwan into the
WTO, triggering openings for U.S. businesses and farmers negotiated
over 15 years.
It is critical for the U.S. -- along with the European Union -- to
propel the Doha trade and development agenda. That is why America has
challenged our WTO partners to view this negotiation as a
once-in-a-generation opportunity. We have proposed the elimination of
all tariffs on manufactured goods by 2015. In agriculture, the U.S.
has called for eliminating export subsidies, cutting $100 billion from
domestic subsidies that distort production and trade, and slashing
tariffs to no higher than 25% -- with the U.S. average dropping to 5%.
The U.S. has also pressed to open services markets, which the World
Bank estimates could add $900 billion a year to developing economies
alone.
Now that the EU has decided on a reform of its Common Agricultural
Policy, we are urging it to translate its internal changes into
aggressive international proposals. We would also welcome leadership
from Japan, which has benefited so much from the international trading
system. To succeed, all WTO members must have a sense of mutual
responsibility, while recognizing the necessity of special treatment
for the poor and most vulnerable. Some argue that there is no need for
developing countries to lower trade barriers, even though 70% of the
tariffs paid by developing countries are to other developing
countries. Yet developing country barriers protect the privileged few,
with the price paid by poor consumers. The WTO's influence will wane
if it comes to embody a new "dependency theory" of trade, blaming
developed countries while not seeking even the gradual removal of
trade barriers in developing economies.
So what should the U.S. do if other nations choose protectionism over
free trade? Under the WTO's procedures, one nation can block progress.
It would be a grave mistake to permit any one country to veto
America's drive for global free trade. Our strategy is based on a
concept that any economics professor should appreciate: competition.
If some countries hide behind the false security of protectionism, the
U.S. will work with those that believe true economic strength is
achieved through openness. The strategy is simple: The U.S. is
spurring a competition in liberalization. In the wake of the
disastrous protectionism of the 1930s, Secretary of State Cordell Hull
employed this logic to cut tariffs and build momentum for global trade
rules by negotiating 32 bilateral agreements.
That is why the U.S. has pressed forward with a portfolio of free
trade agreements while doing all we can to make the WTO negotiations
succeed. Our FTAs are encouraging reformers -- many in fragile
democracies -- in Latin America, Africa, the Middle East, and the
Asia-Pacific region. These partners have become some of the WTO's
foremost champions for open markets.
America's FTAs break new ground -- they establish prototypes for
liberalization in areas such as services, e-commerce, intellectual
property for knowledge societies, transparency in government
regulation, and better enforcement of labor and environmental
protections. Given the new dimensions of globalization, we need to
demonstrate that trade rules can adapt to meet new needs and
circumstances. Our FTAs also level the playing field for U.S.
businesses because others -- especially the EU -- negotiated a host of
agreements in the '90s while the U.S. stood on the sidelines. This
very week, House and Senate Committees will consider the implementing
legislation for our new state-of-the-art FTAs with Singapore and
Chile.
Our free trade negotiations with Central America and the Southern
African Customs Union are helping developing countries gain from
regional integration and stronger economic ties to America. We hope
other U.S. agreements -- for example, with Jordan, Morocco, and
Bahrain -- will serve as models for their neighbors that need to
embrace openness.
The Bush administration's strategy also recognizes that the
Constitution gives Congress the power to regulate trade. During the
last round of global trade negotiations -- which took over seven years
-- when the executive could not keep free trade on offense, the
protectionists were delighted to fill the vacuum. In trade as in
politics, one cannot beat something with nothing.
For years, study groups at the Council on Foreign Relations have urged
the U.S. government to make its foreign and economic policies mutually
supportive. Now that President Bush is doing so to advance growth and
development, open markets for U.S. workers and farmers, promote
economic and political liberty, and build the economic foundations for
stronger security ties, some scholars seem to urge a return to trade
policy parochialism in only one forum.
We will do our best at Cancun to keep the Doha negotiations on track.
But if others falter, the Bush administration will keep negotiating
for free trade -- to create jobs, keep America competitive, and create
opportunities for modernizing reformers around the world.
(Robert Zoellick is the U.S. Trade Representative.)
(end byliner)
(Distributed by the Bureau of International Information Programs, U.S.
Department of State. Web site: http://usinfo.state.gov)