Term Paper: Trade Agreements and Negotiations

Pages: 11 (3470 words)  ·  Bibliography Sources: 1+  ·  Level: College Senior  ·  Topic: Economics  ·  Buy This Paper

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[. . .] On one hand though majority of the Americans believe that their nation will be an inevitable participant in the new global economy, they fail to understand that trade agreements implemented today will only determine the depth of America's position in the future world. They also don't understand that international trade and investment are significantly important to the growth and future of American businesses, regardless of size.

In America today, the problem lies in the fact that there is a widening gap between what they see and the reality, between global facts and figures and their own fear. Many Americans are of the view that trade especially in the international sphere leads to many people losing their jobs, rather than creating new ones for them, they also don't support trade agreements believing that they only help big businesses but only harm the economy of America, its workers, and small business entrepreneurs.

The U.S. Companies Business Pursuits Bringing Positive Change to Latin America

U.S. companies participate in business in different countries not only for cheap labor but also because they work to integrate their corporate codes of conduct into their Latin American operations. These codes enforce the concepts of integrity, diversity, teamwork, mutual respect, open communication and innovation into the working world. This implies in creating ethical business practices in other countries. Technically, U.S. companies are only improving the way companies work with all the stakeholders, especially their employees, customers, business partners and suppliers, competitors, stockholders and the communities in which the business functions.

The U.S. Companies Business Pursuits Bringing Positive Change to China

U.S. holds a great share of business revenues in China because their companies buy, sell and invest in China for its good quality of products and cheap labor costs. The participation of the U.S. has had a positive impact on the corporate world in China. They have helped contribute to establishing China's economy and society; setting their standards for environmental performance and worker health and safety; and also emphasizing on the importance of community involvement.

New WTO Trade Negotiations to Boost the Economy

The Business Roundtable believes that the U.S. holds a strong position when it comes to investing in the national interest for the United States and that it must be the leader in launching, and participating in new WTO negotiations.

The United States no doubt is the leader when it comes to participating in open markets because the U.S. is aware of the fact that with their market being the most open in the world, and with their highly competitive companies, workers and farmers in the world, they can gain enormously once the foreign barriers to products like goods and services through trade agreements are eliminated, otherwise they will face terrible losses if these barriers persist. Due to the foreign barriers the U.S. has been facing problems such as, inadequate intellectual property protection, investment distortions, customs red tape, and other barriers have cropped up becoming a major problem for U.S. exporters and their workers. The U.S. agricultural exports are levied with a raft of tariff and non-tariff barriers.

The decline of the U.S. trade balance has left many interest groups with a view that that now is not the time to find and discover new ways of initiating trade. Some businessmen believe that the question has been misunderstood. Entering into new trade agreements has the potential to enhance economic growth in those countries that are a victim to weak economies, since that will elevate the demand for American exports.

Trade is good for economy, good for business, good for workers, good for farmers and good for consumers in every country. It is largely due to the trade negotiations that the U.S. exports continue to escalate on a good scale. In 1996-1998, real exports went up by 30% from the period between 1993-1995. These exports are the driving force for the economic growth and job creation in the United States. It not just the businesses that are benefiting but even the American workers benefit from expanding trade. According to a study, nearly 12 million U.S. jobs are supported by exports.

It is know that with the opportunities created by the global economy come fears of facing losses. This is why it is important to take a greater insight into the cost leveled against international trade and overcome these fears. For one thing it is important to realize that there is no direct connection between imports and lost jobs. It should also be recognized that trade deficit originates from many factors; so that is why any linkages to trade policies are incorrect.

Improving Economy with Trade Negotiations

The Business Roundtable has created four important principles to lead the U.S. policymakers in the right direction:

The United States need trade and investment policies to make sure that trade accomplishes its purpose of improving the American and global living standards.

U.S. leadership is critical to continued trade liberalization.

The rules-based trading system is the basis of the global economy and implementation of the rules is the foundation for public trust and support for U.S. participation.

Business is a most important element in the global economy and is also the driving force for developing and implementing enhanced trade policy.

The United States aims to improve the world trading system to enhance the global economy. The reason it is important to implement new world trade negotiations that took place in 1999 without setting differences in the economic performance in different countries, or election cycles. Americans are also confident that the new trade negotiations will make the economy of the United States more successful, since the Uruguay Round has been and continues to deliver, an increase the economic growth. The WTO Ministerial in Seattle served as an opportunity for the U.S. government to promote the launching of new WTO negotiations. There are several ways to guide the trade negotiators in achieving the agenda set for new WTO negotiations, to attain U.S. interests. They are as follows:

To understand what a new WTO negotiation can achieve, it is important to divide the issues into two categories:

The built-in agenda that records the ongoing negotiations, and Review and growth of various WTO agreements.

The reports show the benefits of the agreements to the United States after China was accepted to the World Trade Organization (WTO) and PNTR. The reports contain these findings: in these reports are the following:

California's 1998 exports to China totaled $3.5 billion. Its telecommunications industries would benefit greatly from PNTR's elimination of tariffs on network equipment, computers, peripherals, components and instrumentation.

Florida's 1998 exports to China were $800.2 million. Under PNTR, tariffs on oranges, lemons and grapefruit would decrease from 40% to 12%, providing significant benefits to citrus exporters. The Chinese market for grapefruit alone could reach $40 million.

Illinois, whose exports to China in 1998 were $1.4 billion, would enjoy increased sales of heavy equipment, mining and construction equipment, burners, blowers, valves, auto parts, batteries and cell phones.

Massachusetts exported $431.2 million in goods to China in 1998. Under PNTR, health care and biotech companies would increase exports for medical equipment and cancer-detecting products.

New York's total stake in exports to China in 1998 was $1 billion. PNTR would benefit companies that make personal computers (projected to grow by 29% a year through 2002), raw chemicals, photographic and imaging materials, and insurance, banking and securities firms.

North Carolina exported $446.4 million of goods and services to China in 1998. Companies that would benefit from PNTR include those that produce wireless networks, high-speed paging services, mobile telephones, chemicals and raw materials, and wood and paper products.

Ohio exported $521.7 million of goods and services to China in 1998. Under PNTR, agricultural exports would increase, as would sales from tires, industrial automation equipment, consumer and household products, antenna and wireless equipment, and computer software.

Pennsylvania, which exported $468 million in goods to China in 1998, would increase sales and jobs in flow measurement instrumentation, and exports of computer equipment, specialty chemicals, household products, and software-related services.

Texas exported $1.2 billion of goods and services to China in 1998. Under PNTR, exports would increase significantly for beef and beef variety meats, semiconductors (projected to become one of the world's largest markets in the next decade), computers, wireless communications, oil and gas.

Washington exported $3.2 billion of farm, industrial and consumer goods to China in 1998. Reduced tariffs would increase apple exports by $75 million, and substantially help companies that export fish and fish products, logs and finished lumber, pulp, linerboard and corrugated medium.

Source: The Business Roundtable: International Trade and Investment, available at http://www.brtable.org/document.cfm/421]

Economic Integration and Regionalism

Continuous research on economic integration and development concentrates on investment and growth, deep integration, political aspects, regionalism and multilateralism, cooperation and on regional agreements in Latin America, Eastern Europe and… [END OF PREVIEW]

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