Re: USTR ; Request for Comments on Negotiating Objectives for a U.S. EU Trade Agreement

Transcription

1 Linda Dempsey Vice President Internatinal Ecnmic Affairs Filed via December 10, 2018 Mr. Edward Gresser Chair f the Trade Plicy Staff Cmmittee Office f the U.S. Trade Representative th Street NW Washingtn, DC Re: USTR ; Request fr Cmments n Negtiating Objectives fr a U.S. EU Trade Agreement Dear Mr. Gresser: In accrdance with Federal Register ntices related t the abve-referenced dcket, the Natinal Assciatin f Manufacturers submits these cmments regarding the negtiating bjectives fr a trade agreement between the United States and the Eurpean Unin. If yu have any questins, please d nt hesitate t cntact me. Respectfully, Linda Dempsey Leading Innvatin. Creating Opprtunity. Pursuing Prgress th Street, NW, Suite 700, Washingtn, DC P F

2 Cmments f the Natinal Assciatin f Manufacturers n Negtiating Objectives fr a U.S. EU Trade Agreement (Dcket USTR ) December 10, 2018 Manufacturers appreciate the pprtunity t prvide input n the administratin s negtiatins with the Eurpean Unin (EU) fr a U.S. EU Trade Agreement. The Natinal Assciatin f Manufacturers (NAM) is the largest manufacturing assciatin in the United States, representing 14,000 manufacturers, small and large, in every industrial sectr and in all 50 states. Manufacturing emplys mre than 12.8 millin wmen and men acrss the cuntry and prduced a recrd $2.33 trillin in utput t the U.S. ecnmy thrugh the first half f Manufacturing in the United States is mst successful when markets at hme and abrad are pen and fair. Tday, manufacturers in the United States exprt abut half f U.S. value-added utput ($1.35 trillin), helping t supprt recrd U.S. manufacturing prductin and abut half f the U.S. manufacturing wrkfrce. Glbal ecnmic grwth ver the past quarter century has lifted hundreds f millins f peple arund the wrld ut f pverty, prpelling almst 600 millin peple, mstly in Asia, int the middle class since These cnsumers have created recrd levels f demand fr a wide range f advanced and high-quality cnsumer and durable manufactured gds prduced in the United States, frm persnal care, medical equipment and fd prducts that meet cnsumer demand t majr capital and electrical equipment that build new cities and mdernize infrastructure. T cntinue expanding utput and well-paying manufacturing jbs acrss the cuntry, manufacturers in the United States need a strng and multifaceted trade plicy t strengthen pprtunities t reach the 95 percent f cnsumers utside f the United States and cntinue t expand U.S. manufacturing cmpetitiveness. Such a strategy must seek t expand pprtunities at hme and verseas, including by the fllwing: Grwing exprts and verseas sales. Over the past quarter century, manufacturers in the United States have quadrupled exprts, helping t drive a similar quadrupling f U.S. manufacturing utput t reach recrd levels. Cntinued expansin in exprts is vital t enable the highly prductive U.S. manufacturing sectr t grw well-paying American jbs. Eliminating tariff and nntariff barriers, raising standards t ensure nndiscriminatry and fair treatment fr U.S.-prduced gds, prtecting intellectual prperty rights and increasing transparency, fair cmpetitin and gd regulatry prcesses are all imprtant t help expand U.S. exprts verseas. Expanding access t fairly traded imprts and inputs t imprve U.S. manufacturing cmpetitiveness. Manufacturers in the United States have lng supprted pen markets at hme and arund the wrld that allw all players t access imprts in a fair and cmpetitive manner t drive innvatin, prductivity and strnger manufacturing in ways that are critical t bst U.S. manufacturing cmpetitiveness. Imprving access and prtectins fr inbund and utbund investments. Inbund and utbund investments in manufacturing are als imprtant drivers f grwth in the U.S. manufacturing sectr, with bth frms f investment supprting millins f manufacturing 1

3 jbs and increased U.S. exprts, capital investment and research and develpment in the United States. Tackling the wide variety f market-distrting trade barriers in freign markets that undermine fair cmpetitin. T achieve these expansins, manufacturers als need cntinued wrk t eliminate the many frms f trade distrtins, frm subsidies and utright discriminatin against manufacturers in the United States, U.S. gds and investments t ther frms f nntariff barriers and market-distrting practices. 1 Market-pening, high-standard and enfrceable trade agreements with imprtant markets like the Eurpean Unin have lng been a critical part f manufacturers strategy t achieve these gals. U.S. EU cperatin, furthermre, has the ptential t set glbal standards that address market-distrting trade barriers in third markets. Manufacturers, therefre, lk frward t a prductive U.S. EU negtiatin t expand trade and investment pprtunities and address market-distrting trade barriers. I. Opprtunities t Blster the U.S. EU Cmmercial Relatinship Manufacturers in the United States welcme pprtunities t expand the cmmercial relatinship with the Eurpean Unin, including thrugh the negtiatin f a U.S. EU Trade Agreement. The 28 EU cuntries are cllectively the secnd-largest ecnmy after the United States and have a ppulatin mre than all but tw cuntries, China and India. A strnger, mre pen and cmpetitive U.S. EU cmmercial relatinship will expand pprtunities fr the grwth f manufacturing and jbs in the United States. The United States and the Eurpean Unin have the wrld s largest cmmercial relatinship, accunting fr ne-third f the wrld s ttal trade and nearly half f glbal ecnmic utput. Given their cmparably sized ecnmies and high standards f living, the United States and the Eurpean Unin engage in substantial trade and investment, with mre than $638 billin in tw-way trade in manufactured gds and accumulated crss-brder investment in manufacturing f mre than $1.3 trillin. The Eurpean Unin is the United States secnd-largest manufactured gds trading partner verall. U.S.-manufactured gds exprts t the Eurpean Unin in 2017 equaled $244 billin, with substantial exprts f transprtatin equipment, chemicals, cmputer and electrnic equipment and machinery. The Eurpean Unin is the secnd-largest exprt market fr U.S.-manufactured gds after Canada. U.S. imprts f manufactured gds frm the Eurpean Unin ttaled $394 billin in 2017, with high levels f imprts f chemicals, transprtatin equipment, machinery and cmputer and electrnic equipment. The Eurpean Unin is the secnd-largest supplier f manufactured gds imprts int the United States, after China. Ntably, the Eurpean Unin is the largest surce f inward manufacturing investment int the United States n a histrical cst basis. The Eurpean Unin s accumulated manufacturing investment stcks reached mre than $1 trillin in 2017, supprting mre than ne millin 1 Mre infrmatin n these issues can be fund in the fllwing NAM submissins: Natinal Assciatin f Manufacturers, Cmments n Administratin Reprt n Significant Trade Deficits and Request t Appear at Public Hearing (May 10, 2017), accessed at Natinal Assciatin f Manufacturers, Submissin fr the 2019 Natinal Trade Estimate Reprt n Freign Trade Barriers (Octber 30, 2018), accessed at 2

4 manufacturing jbs. 2 EU investment in U.S. manufacturing has grwn substantially ver the past several decades, with majr investments in bth physical capital and research and develpment. While the United States and the Eurpean Unin share a rbust cmmercial relatinship, manufacturers in the United States have lng supprted effrts t expand and imprve that relatinship. Key challenges manufacturers face in the Eurpean Unin include, but are nt limited t, the fllwing: Discriminatry standards, technical regulatins, testing prcedures and cnfrmity assessment requirements that act as barriers t U.S. exprts and sales. Many f these prblematic regulatins are based n nnscientific, quasi-scientific r even plitical factrs; are nt implemented thrugh fully transparent prcedures; lack technical justificatin; r result in implementatin burdens that are nt prprtinate t intended cnsumer r public welfare benefits. Such regulatry appraches are prblematic, nt nly in the Eurpean Unin itself but als in third cuntries. The Eurpean Unin actively exprts these appraches, impeding, thereby, access by manufacturers in the United States, nt nly t EU member states but als ther cuntries. These include the fllwing: Unnecessarily restrictive, nn-science-based regulatry appraches and certificatin challenges that impact manufacturers, including the widespread regulatry use f the precautinary principle t ban substances based n pssible but unprven risk that has a majr impact n nt nly prducers f these substances but als dwnstream users in a brad array f manufacturing sectrs. These appraches, including thse related t Registratin, Evaluatin, Authrisatin and Restrictin f Chemicals (REACH), Restrictin f Hazardus Substances (RHS), Waste Electrical and Electrnic Equipment (WEEE), wrk n the Circular Ecnmy, maximum residue levels (MRLs) and ther emerging rules, impact and disadvantage a wide range f manufacturers in the United States by blcking them frm exprting many highly cmpetitive American prducts t the Eurpean Unin. A wide range f nn-science-based regulatry restrictins and certificatin challenges that directly limit market access fr many types f U.S.-manufactured gds. EU regulatrs undermining and refusal t accept glbally recgnized internatinal standards develped in the United States that increases cmpliance csts, lwers U.S. prductivity and limits U.S. access int EU markets, including in the fllwing areas: U.S. private-sectr rganizatins have develped glbally recgnized internatinal standards in line with the needs f the free market, yet EU regulatrs limit the definitins f internatinal standards that must be cnsidered in drafting regulatins nly t thse created by a specific set f internatinal rganizatins (such as the Internatinal Organizatin fr Standardizatin (ISO), Internatinal Electrtechnical Cmmissin (IEC) and Internatinal Telecmmunicatin Unin (ITU)) instead f fllwing the full Wrld Trade Organizatin definitin f an internatinal standard under its Agreement n Technical Barriers t Trade. These challenges effectively reduce market access fr U.S. prducts unless they underg additinal testing, at an additinal expense, accrding t EU standards. Discriminatin against U.S. standards-setting rganizatins, and the internatinal standards they create, thrugh the essential requirements cmpnent f the 2 Bureau f Ecnmic Analysis, U.S. Cmmerce Department, Freign Direct Investment in the United States, accessed at 3

5 Eurpean Unin s New Legislative Framewrk, which favrs Eurpean standards rganizatins and cmpanies and limits pprtunities fr the use f U.S. standards. Envirnmental and safety regulatry standards fr the autmtive industry that diverge frm U.S. standards, undermining the cmpetitiveness f U.S. autmtive exprts t the Eurpean Unin. The lack f capacity within the EU regulatry system t implement fully, and in a nndiscriminatry manner, varius regulatins that culd result in the withdrawal frm the EU market f U.S.-manufactured equipment frm the United States. The use f gegraphic indicatins that undermine the ability f manufacturers in the United States and ther cuntries t prtect existing prduct trademarks and result in unfair treatment fr cmpanies that make prducts with generic terms. Limitatins n the mvement f crss-brder data and infrmatin and their strage in ways that impede manufacturers ability t mve data acrss brders fr the efficient peratin f their businesses. Plicies and practices that fail t reflect the csts and value f innvatin fully, including regulatry apprvals and incnsistent pricing and reimbursement plicies that differ widely acrss member states. Intellectual prperty challenges and specific weaknesses in patent- and cpyright-related areas. The Eurpean Unin s de minimis threshld fr lw-value shipments (currently abut $200), which impedes access fr manufacturers in the United States, particularly small and medium-sized manufacturers. The maintenance f tariffs and ther nntariff barriers n manufactured and agricultural gds imprts int the Eurpean Unin. EU custms prcessing measures, which diverge frm U.S. prcesses with respect t trusted trader requirements, clearance prcedures that can delay the release f gds upn arrival in the Eurpean Unin and required data elements fr imprters and exprters. As the United States and the Eurpean Unin lk t initiate these new negtiatins frmally, manufacturers lk frward t wrking with the U.S. gvernment t ensure these negtiatins mve quickly t address the unlevel playing field created by agreements with ther cuntries, and fcus n achieving a mre pen and expanded U.S. EU trade and investment relatinship that tackles market-distrting trade practices and ther cmmercial challenges thrugh strng, clear and enfrceable utcmes. II. Cnclusin Manufacturers welcme the administratin s fcus n imprving glbal trade relatinships with the EU and ther cuntries and lk frward t wrking clsely with the Office f the U.S. Trade Representative and ther executive branch agencies t imprve the U.S. EU cmmercial relatinship. 4