Business Beyond the Reef

Not so’s you’d notice.  Long-time readers know that I occasionally rant about the Obama Administration’s insincere approach to free trade agreements and apparent disinterest in using them to create or protect American jobs.  I’m not the only one.  Says Thomas J. Donohue, president and CEO of the U.S. Chamber of Commerce, referring to the overwhelming positive economic impact of past FTAs: “I defy anyone to name another budget-neutral government initiative that has generated anything like this number of jobs.”

Do we want jobs or not?

It’s been tough with my travel lately, but I finally got around to looking at the Chamber’s new study:  Opening Markets, Creating Jobs: Estimated U.S. Employment Effects of Trade with FTA Partners. Some of the stats in the study are eye-popping.  The Chamber study examined the agreements that the United States had in place with fourteen countries in 2008 and found that 17.7  million American jobs depended on trade with those countries.  More to the point, 5.4 million jobs were created by our much-maligned free trade agreements.  Can you think of any other way that more than 5 million Americans can be put to work with no adverse impact on the federal budget?  I can’t.  But this isn’t good enough for the Obama Administration which, while claiming to like FTAs, still doesn’t ask the Democrats in Congress to move forward the stillborn agreements with South Korea, Panama and Colombia.  The South Korea agreement is estimated to mean some 345,000 jobs. Our politicians should ask their voters if they would like a job or two.  And export-related jobs tend to be higher paying than other jobs in the U.S. economy.  Who besides an out-of-touch politician in Washington would say no to such a deal?

The fourteen FTAs that our politicians despise added 2.1% to our GDP in 2008, putting $3.4 billion into the hands of their constituents.  Our exports to these markets grew nearly three times faster than our sales to the rest of the world.  One wonders how this is bad?

The rest of the world has seen the light and is merrily negotiating and implementing new FTAs while our negotiators are left sitting on their hands – and while our exporters find themselves increasingly disadvantaged in foreign markets.  Yes, it would be nicer if our trading partners kowtowed to the wishes of our Congress on labor standards and environmental policies, but when did we get the right to legislate for other sovereign nations?  Would we allow another country to hold up an agreement if they wished to change, say, U.S. military policies in Afghanistan?  Somehow I doubt it, but that is what we are trying to impose on others.  By using FTAs as the tool, we are merely condemning U.S. export sales and killing jobs that our country desperately needs. Wake up, Washington.

• Having trouble finding a freight forwarder, or need a forwarder with special expertise in a market?  Take a look at Freightbook, a free on-line search engine for finding freight forwarders, couriers, customs brokers and many other types of international trade service firms.  Freightbook says they have more than 400 companies listed in 120 countries, which should be enough.  If you are a forwarder or similar firm, you can get your company listed, but that isn’t free.  Hey, they have to make money somehow.  (This is another tip from the Federation of International Trade Associations.)
• Little noticed, but with big potential, China has apparently agreed to consider signing on to the WTO’s government procurement code.  If so, this could solve a lot of issues that foreign companies have in selling to Chinese government agencies and could obviate things like the “indigenous innovation” rules.  If this develops, you’ll see more posts about it here.  I was one of the negotiators of the procurement code and will watch this one closely.
• More good news.  Russia could be in the WTO within a year, says the European Union.  This should loosen some things up.
• I really should do a post on the many “chicken wars”.  Hardly any other product has been subject to as many trade disputes as chickens and chicken parts.  My first one was the famous U.S.-EU chicken war decades ago.  The latest chicken war is between the United States and Russia and it appears to be nearing resolution.  Chickens were involved, too, in the great turkey ball war between the United States and Taiwan (read about it here).

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I’m still on the road, in Sandbridge, Virginia, this morning.  Posts will continue to be sparse for a while.  Our goddaughter is getting married and we are kneedeep in all the hoopla.  We are also waiting for our daughter to deliver our first grandchildren.  She is due to deliver twins at virtually any moment!  That takes precedence over blogging, so bear with me.

Psst … wanna hear a secret?  The Hawaii Tourism Authority must have lots of them!  HTA bamboozled the Lingle Administration and the dominant Democrats in the Hawaii State Legislature into passing unprecedented rights to close its meetings for almost any reason at all.  All HTA has to do is declare that their board is discussing “secrets” they wish to keep Hawaii’s competitors from discovering.  The result is the agenda that has been published for the next HTA board meeting on May 27:

Oh, the secrets we must protect ...

If you have followed my posts about Hawaii tourism marketing (the most recent, Debacle in Paradise, is here), you are likely wondering what secrets the HTA could possibly wish to hide.  HTA’s international marketing is amazingly lackluster and the markets they target are, as we say in Hawaii, same-old, same-old.  They have been going after the same markets (U.S. East Coast, U.S. West Coast, Canada and Japan) for as long as anyone can remember, and Japan – an important but non-expanding market – still dominates their international spending.

But wait, you say, what about HTA’s increased budget for China?  Oh yeah, that’s a big secret.  Who would have expected Hawaii to go after the fastest growing travel market in the world?  I’m sure that’s one they needed to hide from the competition.  And South Korea?  It must have been a huge surprise to Hawaii’s competitors that we would take advantage of our own country’s visa waiver program, newly inaugurated in South Korea.  Oh, we must hide that.

Perhaps HTA has stealth marketing programs elsewhere.  We can hope.  Their own published budgets show a vast decrease in European marketing; apparently HTA only wants Brits and Germans, and not many of them.  HTA spends a pittance in Australia, New Zealand and Taiwan.  Maybe those are the secret programs they don’t want the public to know about.  Or could they be running covert tourism campaigns in India, Latin America, the Middle East, S.E. Asia, Mexico, Scandinavia, Africa, France, Switzerland, Russia – all markets in which HTA officially spends nothing, nada, zero, zilch?

Maybe the big secret is a hidden plan to actually participate in the world’s major travel and tourism trade shows!  You know, places where they might have to meet and talk to potentially new business partners – not just the same old ones HTA has gone to for years and years.  Imagine the board’s trepidation.

But enough cynicism, no matter how well deserved.  The real secret, I fear, is HTA’s failure of imagination, aversion to risk, high comfort level in existing relationships and strategic incompetence.  Don’t get me wrong, HTA is excellent at implementing programs in the markets they know – but the HTA Board has a responsibility to consider development of new markets and to examine questions raised about the vast portions of the globe where Hawaii is now unseen and unheard.  Their secrecy, I’m afraid, guarantees the same-old, same-old.

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Posts may be sparse the next few days.  By the time you read this, my wife and I will be on the East Coast to attend a wedding.  We’re staying with family and friends, and – as wonderful as that is – it means blogging time may be at a premium and Internet access uncertain.  I’ll post when I can, but bear with me for a few days.