WASHINGTON — Senate Finance Committee chairman Max Baucus (D., Mont.) proposed a blueprint for trade on Tuesday, with the Asia-Pacific region as its centerpiece.
This story first appeared in the November 11, 2009 issue of WWD. Subscribe Today.
Baucus prodded President Obama, who is leaving Thursday on a seven-day trip to Asia, to pursue a regional trade pact with key Asian trading partners. He outlined the goals to a sold-out audience of trade importers and associations at an event cosponsored by George Washington University’s Institute for International Economic Policy and the Washington International Trade Association.
Baucus called on Obama and Congress to be more aggressive on trade, saying the U.S. must expand commercial ties to other Asian nations while maintaining a steady trade relationship with China. He said a balance, including stronger labor and environmental provisions, was needed in trade deals.
“Asia must be the centerpiece of our new trade strategy,” Baucus said. “This vital region is pursuing integration at lightning speed. We cannot be left behind.”
Baucus said Obama should pursue the Trans-Pacific Strategic Economic Partnership, also known as TPP, a regional trade deal between Singapore, Chile, New Zealand and Brunei Darussalam, which went into effect among those countries in 2006.
“As President Obama heads to the [Asia-Pacific Economic Cooperation] leaders’ meeting later this week, I urge him to revitalize our relationship with these economies,” Baucus said. “Speak up. I urge the President to announce the U.S. will be a robust participant in the Trans-Pacific Partnership negotiations.”
Obama will visit Japan, Singapore, China and South Korea for the first time as president. He also plans to attend the APEC leaders’ summit in Singapore, followed by a meeting with the 10-nation Association of Southeast Asian Nations.
Former president George W. Bush launched formal negotiations with the four TPP countries in September 2008, seeking to have the U.S. join the existing trade pact. In addition to the U.S., Australia, Peru and Vietnam also expressed interest in joining the agreement. Obama put the U.S. involvement in the TPP under review after he took office in January.
U.S. textile groups voiced opposition to the regional trade pact, particularly Vietnam’s potential participation during a hearing held by the U.S. Trade Representative’s trade team in March. However, importers were supportive, saying the accord would provide a platform for more trade agreements in Asia.
The U.S. already has separate trade agreements with Singapore, Chile, Australia and Peru.
“The administration has been reviewing participation in the TPP in the context of broader Asia economic policy,” a USTR spokeswoman said Tuesday.
On other trade issues, Baucus said he expects Congress to extend two trade preference programs that are to expire at the end of the year. He said lawmakers likely will pass an extension of duty free benefits for four Andean countries, as well as an extension of the U.S. Generalized System of Preferences, a program providing duty free benefits to 131 designated countries covering about 4,800 products.
But he warned that lawmakers plan to vigorously review the countries receiving benefits in those two programs next year because some have outgrown their eligibility and others have not aligned themselves with the U.S. on broader issues.
Baucus also discussed resolving outstanding issues with pending trade pacts with South Korea, Colombia and Panama negotiated under the Bush administration, but which have stalled over specific concerns by leading Democrats in Congress. Baucus pointed to barriers to U.S. auto and beef exports in South Korea, assassinations of trade unionists in Colombia and tax havens in Panama.