Assistant Secretary of Commerce and Director General Suresh Kumar
U.S. and Foreign Commercial Service
Remarks at RepCAN 2010 AMCHAM Luncheon
Thursday, June 17, 2010
As prepared for delivery
Thank you, Ambassador Jacobson, for that very kind introduction. I want to let you know how much the U.S. Commercial Service appreciates your support for our operations here in Canada, and your leadership with regard to the U.S.-Canada trade relationship. I also want to thank William Polushin, Mary-Ann Carrigan, and the American Chamber of Commerce in Quebec for their close partnership with our team here.
It is an honor for me to join so many business leaders here in Quebec to share some thoughts about President Obama’s National Export Initiative and the importance of our trade and economic relationship with Canada.
The United States and Canada share one of the richest, broadest, and deepest relationships in the world. An estimated three million people in the United States trace at least part of their ancestry back to Canada. And Canada is home to more than one million Americans. Many families straddle our common border – including President Obama’s, whose brother-in-law hails from Burlington, Ontario.
On a personal note, after living and working in India, Singapore, and Indonesia, my North American business career began in Toronto, where I spent several years in the early 1990s during my time with Warner Lambert. In this capacity, I oversaw business units and manufacturing facilities across the country including ones right here in Quebec. I have seen first-hand the extent of our great economic partnership in North America, and the benefits it provides to consumers and employees across our border.
The shared U.S.-Canada border is over 5,500 miles long, and it binds together companies, employees, tourists, sports fans, and others who depend on goods and services from across our two countries.
In fact, Canada and the U.S. share the largest bilateral trading relationship in the world, and the trade between our two countries is a critical part of our prosperity.
Over $1 billion of two-way trade and 300,000 people cross the border daily. Two-way merchandise trade totaled almost $430 billion in 2009. Roughly, one-third of all foreign visitors to the U.S., nearly 18 million, came from Canada. The ability of millions of Canadians and Americans to maintain their way of life and improve their standards of living depends on this trading relationship.
Another way to understand the magnitude of this trade is that the two-way trade that crosses the Ambassador Bridge between Detroit, Michigan and Windsor, Ontario equals all U.S. exports to Japan. Or stated another way, Canada is a larger market for U.S. goods than all 27 countries of the European Union combined.
The other predominant characteristic of our economic relationship is its integration. Many of our industries have reached levels of integration beyond what we imagined when the North American Free Trade Agreement was signed 16 years ago. For example, the U.S. and Canada enjoy the largest energy trade relationship in the world. Canada is the single largest foreign supplier of energy to the U.S., including the leading supplier of oil, natural gas, and nuclear fuel. Canada is also the largest electricity supplier to the U.S., and Canada and the U.S. share an integrated electricity grid and supply almost all of each other’s electricity imports.
In many other industries, our two countries defy traditional economic concepts of cross-border trade and act as one market and one supply chain. Our cooperation in aerospace is one adorned with great successes, where milestones for all of humanity have been achieved. Over 40 years ago, it was a Canadian company from Quebec that made the landing gear for the Apollo 11 space shuttle, enabling Neil Armstrong to land on the moon and take man’s first step in outer space.
Today, integration in our aerospace industries is more seamless than ever. Bombardier produces its aircraft in cooperation with hundreds of U.S. suppliers, such as Hamilton Sunstrand for hydraulic and fuel systems, Pratt & Whitney for engines, and Rockwell Collins for avionics. Ultimately, these airplanes are then purchased by major U.S. airlines.
Bell Helicopter Textron, a U.S. company, has established its entire commercial helicopter manufacturing facility in Quebec. With hundreds of Canadian engineers and thousands of other workers, this U.S. company has produced more commercial helicopters worldwide than any other, and continues to develop new innovative products.
There are many reasons why Canadian and U.S. businesses look at each others’ markets first when exporting. Not only are Canada and the U.S. geographically close, but we have similar markets with complementary regulatory structures which allows for ease of entry into the others’ market.
And it is not only trade, but investment, which is critical to our relationship. The U.S. is Canada’s largest foreign investor, and Canada is the fifth-largest foreign investor in the United States. At the end of 2008, Canadians held $221.9 billion in direct investments in the United States and Americans held $227.3 billion in direct investments in Canada.
The critical importance of this unmatched trade and investment relationship is its direct link to job creation, both in the United States and Canada. For example, U.S. exports already support nearly 10 million jobs in America, including almost 7 million manufacturing jobs. However, U.S. exports as a percentage of GDP are well below that of nearly all of our major economic competitors. Additionally, less than 1% of America’s 30 million companies export, and of those companies that do export, 58% export to only one country. America needs to do better.
At a time when unemployment remains at unacceptably high levels, increasing global trade has become a national imperative. With traditional drivers of U.S. economic growth like consumer and business spending facing headwinds, it has never been more important for our companies to connect with the 95% of the world’s consumers who live outside the United States.
This linkage between exports and job creation is a key characteristic of the 21st century economy. That is why President Obama announced the National Export Initiative earlier this year. The NEI is an unprecedented, comprehensive strategy aimed at doubling U.S. exports over five years, while creating two million American jobs in the process.
The NEI leverages the resources of all the departments and agencies of the U.S. Government that support trade to better assist American businesses that want to sell their goods and services abroad. And it’s the first time that the United States has had a government-wide export-promotion strategy with focused attention from the President and his cabinet.
The Commerce Department is playing a lead role in the NEI, which strives to impact three critical areas of international trade: trade promotion and advocacy; availability of credit and financing; and free and fair access to foreign markets. Let me focus on the first element of the NEI, as it is largely the responsibility of my organization – the U.S. and Foreign Commercial Service.
As Assistant Secretary of Commerce and Director General, I lead a team of over 1,500 trade professionals in 109 domestic U.S. Export Assistance Centers (USEACs) and 126 commercial offices located in our embassies and consulates in almost 80 countries. Our offices serve as one-stop shops for U.S. exporters, providing a comprehensive toolkit of services – from market research to trade counseling, and from business matchmaking to trade advocacy through our Advocacy Center.
One of the Commercial Service’s most effective trade promotion tools is our trade missions, which help U.S. companies learn first-hand about global markets. The NEI has raised the profile of the 33 trade missions that the U.S. and Foreign Commercial Service is supporting in 2010, by ensuring that many of them are led by top officials at the Department of Commerce and other agencies.
RepCAN 2010 is a perfect example of the type of trade event that the Commercial Service organizes to help U.S. companies find potential partners in Canada. It is a multi-sector trade mission involving 38 companies that started in Vancouver, moved to Toronto, and is now culminating in Montreal. I understand that there are several promising deals already in the works.
Let me take this opportunity to thank Janice Corbett, our Senior Commercial Officer here in Canada, for the tremendous efforts that she and her team have put into this event to make it such a success.
America’s strength has always been our ability to create and sell products and services that help others around the world improve lives and livelihoods. The National Export Initiative will contribute to helping our country build a stronger economic foundation by building our trade relationships and dedicating more resources to connecting U.S. exporters with foreign buyers and distributors, which will create more jobs, both in Canada and America.
Simply put – through the National Export Initiative, American businesses that want to engage in international trade are going to have a more vigorous partner in the US government.
Thank you for having me with you today. And for all of the companies that have joined RepCan 2010, I wish you lots of success from your business dealing this week and beyond. Good luck!
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