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Under Secretary Of Commerce For International Trade Stefan M. Selig Speaks at Regional Economic Competitiveness Forum(Targeted News Service Via Acquire Media NewsEdge) EL PASO, Texas, Sept. 12 -- The U.S. Department of Commerce's International Trade Administration issued the text of the following speech by Under Secretary Stefan M. Selig: Good afternoon. It is a privilege to have the opportunity to address all of you today. I cannot think of a better occasion for my first trip to Texas as Under Secretary of Commerce for International Trade than the Regional Economic Competitiveness Forum. First, a sincere thank you to Congressman O'Rourke for hosting this event and inviting me to speak. There are also a number of other people I would like to acknowledge. I would also like to recognize Congressman Henry Cuellar, Congressman Joaquin Castro, and, from my home state of New York, Congressman Bill Owens for their participation. Also, thank you to Mayor Oscar Leeser for having us in this wonderful city. I'd like to acknowledge David Olsen, our Mexico desk officer, who also made the trip with me from Washington today. And I would also like to acknowledge and thank our team on the ground here in El Paso. Our U.S. export assistance centers--we call them USEACs--that are based in more than 100 cities throughout the country work hard to help U.S. companies access new markets, build important business relationships, and enforce their legal rights when necessary. I would like to specifically highlight the efforts of Bob Queen and his U.S. Export Assistance Center based in El Paso. The day-to-day work of his team has helped take the Texas-New Mexico-Chihuahua region and made it one economic engine. One example of that work is what Bob did for Keats Metal Stamping, a supplier of metal parts for the automotive, medical, and electronic industries. Twenty years ago, Keats, a Chicago based company, made the decision to expand its production to El Paso. Their goal was to tap into the maquiladora industry in Mexico by providing their metal stampings and wire forms. It was Bob Queen who set out to learn about the material needs in Mexico. Then, he developed contacts and trade leads that helped Keats as well as other U.S. businesses. As a result, Keats was asked to join the supplier development program of a large electronics manufacturer in Juarez. That is the kind of synergy that happens when a great market, a great company, and the world class client services of our USEAC come together. Today, I'd like to discuss our vision and our commitment to the High-Level Economic Dialogue or HLED between the U.S. and Mexico by laying out our five key priorities. And I would like to start by briefly reflecting on the U.S.-Mexico relationship. The symbolism of today's forum taking place in the border town of El Paso is obvious to anyone here. The Border region is often referred to as bi-national. And for good reason. U.S. and Mexican workers in this region account for the largest bilingual, bi-national workforce in the entire Western hemisphere. Collectively, the Border region boasts 450 manufacturing plants in Juarez that employ more than 200,000 workers, many of whom commute from El Paso. 5,000 American citizens commute to Juarez each day to manage facilities, as well as design and deliver U.S. materials. That strength has helped elevate El Paso into a major economic hub. The Bureau of Labor Statistics in 2012 ranked it the fifth leading U.S. metro area for projected job growth between 2010 and 2020. And according to a study we released last week, El Paso is also the 22nd largest exporting city in the country. Merchandise exports from the El Paso metropolitan area in 2013 totaled more than $14 billion. That is a record The Border region also speaks to the enormous economic power of the U.S.-Mexico trade relationship. Total U.S-Mexico trade in goods and services last year was valued at over $550 billion. By the end of the next minute, $1 million in goods will be exchanged between our two countries. And by the end of the day, that figure will be $1.5 billion. Mexico is our second-largest export market and third largest bilateral trading partner in the world. Mexico is also the second most important destination for our small business exports. And it is a trade relationship that supports approximately 6 million U.S. jobs according to the Woodrow Wilson Center and the U.S. Chamber of Commerce. My talented Deputy Assistant Secretary Walter Bastian told me that you could fill Sun Bowl Stadium 116 times with that many Americans. It is the power of this trade relationship that motivated us to enact our Look South Initiative this past January, a coordinated federal government effort to boost exports to Mexico and our 10 other Latin American free trade partner markets. Look South directly responds to our NEI/NEXT program, which is dedicated to helping U.S. firms: Tap directly into global markets Help companies and entrepreneurs understand the importance of global trade And make it easier for them get involved. So I think Vice President Biden said it best when he launched the HLED last September. He said that the ties between our countries rest on a foundation of: "Common culture, common values, and common dreams, in addition to a long common border." Or as Mexico's former foreign minister Jorge Castaneda stated: "Mexico's heart is in Latin America, but its purse strings, brain, and eleven percent of its population are in North America." But there is a something else we share besides culture, values, dreams, purse strings, and a border that I should mention. And that is the responsibility of leadership: global and regional leadership. As you know, we are approaching the twentieth anniversary of the Mexican peso crisis. Mexico found itself in the midst of a currency crisis, a banking crisis, and ultimately a severe recession that almost brought the entire economy to the state of collapse. That was only 20 years ago. Less than a generation. And in that time, Mexico has produced an economic transformation that is both remarkable and ongoing. Mexico produced one of the largest expansions of middle class society we have seen in recent memory. Roughly 40 million Mexicans comprise the country's middle class today. Mexico has just enacted an historic reform measure that will open opportunities for private investment in the energy sector. It has also enacted an equally historic reform that will open up the country's telecom sector. The country's per capita GDP has nearly tripled in the last 20 years. And the OECD projects that Mexico will be the world's tenth largest economy by 2015. Goldman Sachs projects Mexico to be the world's fifth largest economy by 2050. Maybe the most interesting insight regarding Mexico's rise came from Shannon O'Neil, a senior fellow at the Council on Foreign Relations. In her book, Two Nations Indivisible: Mexico, the United States, and the Road Ahead, she wrote: "Mexico is less a problem and more an answer for the economic, security, and international diplomatic challenges the United States faces today." This quote is particularly telling because it acknowledges that Mexico is not only an economic and security partner with the United States. It is also a strategic and diplomatic partner. Our collective effort to finalize the Trans-Pacific Partnership, which will modernize the North American Free Trade Agreement, does not only mean creating a global market comprising 40% of global GDP and 800 million customers. It also means completing the economic leg of the president's rebalance to the Asia-Pacific. Energy trade between our countries, particularly in petroleum and natural gas, will not only boost our markets but will be a key to achieving long-term energy security and sustainability for North America. So we clearly share the responsibilities of regional and global leadership. And we also share the priorities that come with that leadership--including the five priorities I would like to address in my remarks today. Developing our economies generally and our human capital in particular; Optimizing our trans-border businesses; Better developing our border infrastructure so that its capacity matches our market needs; Establishing regulatory cooperation that ensures both product safety and free-flowing goods exchange; and Making the strongest case that regional trade is a win for our country's businesses and our country's workers Our ability to address these priorities clearly represents the difference between choosing to succeed together or choosing to fail separately. This has become quite apparent to me during my time leading ITA. One of my personal goals as head of ITA is to take my agency to new heights when it comes to commercial diplomacy. And it is clear that Mexico is an essential partner in that goal. So if that is the road, then the High Level Economic Dialogue is the road map. In fact, it is both the roadmap for our shared leadership and the platform that will allow us to achieve and nurture it. Our joint-dialogue is built on three pillars: Partnering for regional and global leadership; Promoting competitiveness and connectivity; and Fostering economic growth. Last September, the Obama administration launched the joint-dialogue, which is co-chaired by: The departments of Commerce and State The Office of the U.S. Trade Representative And our Mexican counterparts. Under the HLED, U.S. and Mexican cabinet officials meet annually and sub-cabinet members like me meet throughout the year to discuss how we can achieve collective goals. And in fact, the next cabinet level meeting, which I will be attending, will be taking place before the end of this year. I can also speak to the important place the HLED holds on the Commerce Department's agenda. Secretary Pritzker attended the launch of the joint dialogue last September. She hosted a North American Competitiveness and Innovation Conference last October, and I will be participating in this year's conference this October in Toronto. And it is worth noting that the Secretary's first trade mission was to Mexico City and Monterrey this past February. The importance of the HLED is also why I am committing myself to the dialogue, and why it will be a major focus during my time leading ITA. I am also here today because I want to send a message to American businesses--who also happen to be my clients--that I want to and will engage you in this important work. One of the important facets of the HLED is ensuring that private sector and other stakeholders input is integrated into our thinking and planning. We at Commerce take that responsibility very seriously. And you can count on me to follow through on this topic. As I mentioned earlier, I would like to spend the bulk of my remarks discussing the five key priorities we will be pursuing under the HLED. Priority number one is economic development. Economic development is essential because we cannot expect to maintain our leadership in today's global marketplace without developing our human capital and unlocking the maximum gains of a real opportunity economy in both of our countries. There are a couple of initiatives that we have taken on so far under the joint dialogue that I would like to walk you through. This past April, we held our first ever Americas Competitiveness Exchange. This was the first entrepreneurship delegation exchange under the HLED. ITA senior officials led a delegation of 45 business and government leaders from Mexico and other Latin American nations, with the hope of creating the business connections that can lead to future business deals. Out of this effort, a Mexican medical device start-up will partner with two institutions--Georgia Tech's Global Center for Medical Innovation and Clemson's International Center for Automotive Research--to take advantage of their incubator connections. Mexico just hosted its first Competitiveness Exchange in August in Mexico City, Aguascalientes, and Guadalajara. Over 20 corporate representatives from the Western Hemisphere were invited to attend the country's National Entrepreneurship Week as well as tour advanced technology centers, innovation hubs, and technology parks. The other initiative is BREDS or Border Regional Economic Development Strategies. BREDs connects senior U.S. and Mexican officials with subject matter experts so they can develop regional strategies for economic development, technology use, and environmental protection. In fact, last month, Mexican ministry officials hosted subject matter experts from ITA and our sister agency, the U.S. Economic Development Administration or EDA to develop those very strategies. Economic development is an absolute priority because it will be a key to revving up a U.S.-Mexico-Canada market predicted to have a collective GDP of $50 trillion by 2050. The second priority relates to regional or trans-border opportunities. And this reminds me of the famous Tip O'Neill quip "All politics is local." As everyone here knows, commerce between two countries can be remarkably local. The reality is that the economic integration of our countries is now so deep that it has spurred growth engines that literally traverse our borders. The driving force behind this priority is the cluster mapping pilot being launched between the U.S. and Mexico. If you are aware of cluster mapping, then you know why it is incredibly exciting. It is a groundbreaking initiative that has been led by the Commerce Department in collaboration with EDA and my alma mater Harvard Business School. As many of you probably know, a cluster is a grouping of industries that are tied by both geographic proximity and supporting assets. So for example, a bio-pharma cluster could include a manufacturing center, goods distributors, venture capital firms, hospitals, talented medical professionals, and research universities all within a single location. Because clusters involve interconnected stakeholders that share proximity and infrastructure, the results tend to be: Higher talent retention, Higher productivity, And major gains in jobs, wages, and innovation. Relying on open source data, cluster mapping is an effort to create a network of interconnected professionals in similar fields. This will enable clusters to be identified and to offer the framework for collaboration among industry experts across borders. This comprehensive industrial index map will generate investment that will allow these clusters to develop into major growth engines. Currently, our team is working on a pilot with the CaliBaja mega region to add Mexican data to the U.S. map. Because this cluster operates within two countries, previous studies have not captured its true value as a unified business entity. So the more data that can be provided to establish the industrial and economic strength of this cluster; The more transparency that will offer to potential investors; The more investment it can attract; And the more prosperity it can produce in the future. The third priority relates to our border infrastructure. The U.S. and Mexico do share one of the largest borders in the world so I would like to start by emphasizing the enormous security importance of that shared border. Security is not something that ITA or Commerce takes lightly in the context of its work. In fact, it plays an essential role in our policy planning. That is precisely why when we work on our efforts to improve the traveler experience into our country, we do not do so in a vacuum. We work closely with the Departments of State and Homeland Security to ensure that we are not undermining border security in the interest of spurring our travel and tourism industry. Commerce recognizes the role security plays in ensuring that legitimate goods and travelers are able to cross the border in a safe efficient manner. Bottom line, our economic and physical security are not mutually exclusive. They are in fact mutually reinforcing. But we cannot lose sight of the market power of this shared border--a market power defined by: Robust trade in goods and services, Foreign direct investment in each other's economies, And a mutually beneficial energy partnership. We've already touched on the economic importance of the Border region. But we also need to focus on why market border infrastructure is so important, and what the cost of inaction is. A study commissioned by the Texas Department of Transportation in 2011 reported that if operational capacity of our border crossings is left unimproved through 2035, we can expect an economic contraction--a contraction--in the El Paso-Juarez region of 22%, valued at $54 billion. Meanwhile, wait times to cross the border in the Fabens/Tornillo area could be as long as two hours by 2025 and maybe three hours by 2035 without improvements in our capacity according to that same study. Nearly all of the goods exchanged between our two countries are transported by truck or rail. So our collective leadership requires that our border infrastructure capacity match our economic and human growth potential. That is why I am here today to tell you that Commerce is working with the Departments of Homeland Security and State to push the envelope and get things done expeditiously. One success to report is a pilot program at Laredo International Airport that will pre-screen and pre-inspect cargo, which is now operational. That will help alleviate traffic pressure at the ports of entry on the ground. Earlier this year, Secretary Pritzker conducted an HLED video-conference with leaders of both of our countries and identified three priority infrastructure projects. One of the projects is the Nogales-Mariposa port of entry. We are pleased that this project is near completion and slated for opening this October. This is good news since this port of entry processes more than half of the Mexican winter produce entering the U.S. The other two projects are the West Rail Bridge in Brownsville and the Tornillo-Guadalupe Bridge in El Paso, which I know is a subject of interest among many of you here today. When completed, this six-lane bridge in El Paso will provide a new and important option for international crossing. And when both bridges are completed, they will provide an enormous boost when it comes to traffic alleviation and the movement of commerce. However, these projects are complex. Lots of stakeholders are involved at the federal, state, and local level. So progress is not happening as quickly as everyone would like. But let me be clear. Completing these projects is essential to maximizing the economic potential of the U.S.-Mexico relationship. I myself saw firsthand the importance of efficient border operations this morning when I visited the Bridge of the Americas. I have also talked to businesses, government officials, and local stakeholders on both sides of the border, so I could learn how the federal government can help facilitate the completion of important port of entry projects in the greater El Paso- Juarez area. And I also solicited feedback for the initiatives we are undertaking with Mexico under the banner of the HLED. So I can assure you that these are priority projects and that I will fully utilize ITA's resources to accomplish our goals. Pursuing the successful repair of these projects is not a matter of policy preference. It is a matter of economic necessity. And we can have no slippage. The fourth priority is regulatory cooperation. The regulatory space presents a dual challenge for leader nations: how do we secure the safety and quality of our goods and services while removing unnecessary barriers that would infringe on our trade relationship? As leader nations, we do not have the luxury of choosing between these interests. We are expected to achieve them both. That is why President Obama has issued executive orders and President Pena Nieto signed a pact to focus on regulatory improvement. So whether we are: Increasing collaboration on food safety regulations, Working collectively to increase innovation in nanotechnology, Or ensuring regulatory compatibility in oil and gas exploration; We will and must continue to work with our counterparts to execute and optimize regulatory cooperation. This includes finding market-friendly regulations for the newly opened up energy and telecom sectors. Regulatory cooperation would also optimize our free trade relationship by ensuring that our small and medium sized firms can fully tap into each other's markets. Both U.S. and Mexican small and medium sized enterprises run into the challenge of an information deficit regarding exports. A lot of U.S. and Mexican SMEs simply do not have the proper information or understanding regarding export requirements. So regulatory cooperation can remove an enormous source of ambiguity for a class of companies that is so essential to both of our economies. Mexico is the second-largest market for U.S. SMEs. Nearly 50,000 U.S. small and medium sized firms send merchandise exports to Mexico. As for Mexican SMEs, according to the OECD, they account for 99.8% of all Mexican enterprises, and more than 72% of all employment in that country. So eliminating regulatory hurdles will be an enormous benefit for Mexican SMEs as well. We will identify regulatory issues to be included in the work stream by the annual HLED meeting coming up this winter. Finally, our collective responsibility includes highlighting the importance of the U.S.-Mexico relationship to middle-America. On our end, that leads us to the Heartland Outreach Tour. Representatives from the Southern Border Caucus, Commerce department officials, and Mexican and Canadian government officials tour the country to explain the importance of our border trade relationships and how they help the American people. And the officials are doing it in a variety of ways. It could be a meeting with a local chamber of commerce, A business roundtable discussion, A tour of a manufacturing facility, Or an interview on TV or radio. From Commerce's side, this has been led by Deputy Assistant Secretary Bastian, who has already made four trips as part of the Heartland Outreach Tour. In March, he went to Atlanta, Georgia with Congressmen Filemon Vela and Congressman O'Rourke to tout the more than $2.6 billion in Georgia goods exported to Mexico last year. Walter also went with Congressman Vela to Raleigh, North Carolina in April. That state last year exported goods to Mexico to the sum of more than $2.7 billion. In June, Walter's travels took him to Des Moines, Iowa and Omaha, Nebraska with Congressmen Lee Terry and Pete Gallego. Iowa and Nebraska merchandise exports to Mexico last year were valued at $2.2 and $1.16 billion respectively. So in case you are calculating, that is four states, and just over $8.5 billion of goods exported to Mexico. The Heartland Outreach Tour proves that if Commerce and ITA are going to move the U.S.-Mexico relationship forward, then this doesn't mean just doing our part at the border. It means doing our part throughout the country. That is because the effects of the U.S.-Mexico relationship extend throughout the entire United States. That fact leads me to my conclusion. Outside observers may think that we are approaching a time when the U.S.-Mexico relationship will be deprioritized, given the President's rebalance to the Asia-Pacific or the political upheaval tied to the Arab Spring. But there is a very simple reason for why the U.S.-Mexico relationship can never be deprioritized, no matter what happens anywhere else on the globe. The simple reason is that we cannot afford to. If there is an idea that has particular resonance at this point in time, an idea that is shared by everyone regardless of your political affiliation: It is that we have to be strong at home if we are going to be strong abroad. Mexico is indeed an answer to our international diplomatic challenges. It is so because the U.S.-Mexico relationship makes us stronger at home. Our collective work to finalize the TPP will not only mean securing the economic leg of the president's rebalance to the Asia-Pacific. It will also deepen our relationships with a set of countries that, according to the United States Trade Representative, already send over $600 billion in foreign direct investment into the U.S. and by nearly $700 billion of U.S. goods. The long-term energy security and sustainability we attain through the energy trade between our two nations will also mean long-term economic security for the U.S. And optimizing the U.S.-Mexico relationship that supports 6 million U.S. jobs means ensuring that we will unlock the maximum benefits of a real opportunity economy in the U.S. The HLED is merely an extension of the fact that the U.S.-Mexico relationship is an essential building block to the United States achieving its larger policy goals; Economic and strategic; Domestic and on the global stage. I can assure you that ITA, the Commerce Department, and the Obama administration all agree on this. I thank you all for what you do to help American businesses move forward and I look forward to taking your questions. TNS 30VianaGem - 13080940913-4859221 30VianaGem (c) 2014 Targeted News Service |