Assistant Secretary of Commerce Nicole Y. Lamb-Hale
Manufacturing and Services
E3 Conference: Energy, Economy, and Environment
Tuesday, November 30, 2010
St. Paul, Minnesota
As prepared for delivery
Good Afternoon. I would like to thank the University of Minnesota’s Institute on the Environment for coordinating the E3 Conference and for inviting me to take part in today’s program.
I am very delighted to be here today to talk to you about: 1. the Obama Administration’s National Export Initiative; 2. what we are doing at the International Trade Administration to help U.S. exporters; and 3. finding more ways that we can work together to increase the competitiveness of America’s exporters.
We are now seeing signs of improvements in the economy, which is growing at an annual rate of 2.4 percent as of the second quarter of this year, compared to a year ago.
The numbers are heading in the right direction, but they are still not where we want them. We still have the challenge of achieving sustainable growth for our economy and creating jobs. Expanding international trade and opening markets for U.S. firms is one of our best options for redirecting the American economy and it is one of the key missions of the International Trade Administration.
In 2008, U.S. exports supported more than 10 million full- and part-time jobs. Imagine what our economic position and our unemployment rate would be if we could only double the share of exports as a percent of GDP in this decade.
Growth in the world economy will be more and more driven by nations seeking to improve their standards of living thereby generating demand for goods and services that will increase over time. A new global middle class is emerging and creating new global markets for our goods and services. By implication, U.S. companies will have greater prospects for success by seeking export opportunities.
And one of the reasons I am so pleased to be here is that the participants here today are playing a very important role in ensuring this growth.
Minnesota is a leader in the expansion and broadening of exports to overseas markets.
Based on the most recent information from Minnesota’s Department of Employment and Economic Development, exports of manufactured goods in this state increased 53 percent from 2000-2009 (from $9.5 billion to $14.6 billion respectively). This increase can be attributed in part by more exports from Minnesota to China which increased roughly 395 percent during the same period.
For the second quarter of 2010, Minnesota’s exports increased 19 percent over the same period last year. The state’s exports of manufactured goods in the second quarter of 2010 totaled $4.3 billion, an increase of $681 million from the same period last year.
Innovative companies in Minnesota such as 3M, which are at the forefront of wind and solar technology development, and Windlogics, which assists with all facets of wind plant development and operation from initial site evaluation through operational assessment, are examples of U.S. companies that are making a difference in deploying innovative technologies and solutions.
The Five Pillars of the National Export Initiative
Exporting is good for American business, good for American workers and good for American jobs. That is why President Obama launched the National Export Initiative and set the goal of doubling U.S. exports in five years and that is why the Obama Administration is committed to working with U.S. companies to help ensure that American-made goods and services succeed in the global market.
Put simply, when America exports, America prospers. At a time when Americans are saving more and consuming less, exports can help to create the jobs needed to bring unemployment down and help to assure a strong and durable recovery.
To meet this objective, the President established five pillars for the NEI which are:
- Improving advocacy and trade promotion;
- Increasing access to export financing;
- Removing barriers to trade;
- Enforcing our trade rules;
- and Promoting strong, sustainable, and balanced growth.
With that backdrop, I’d like to tell you what the ITA and my unit, Manufacturing and Services, are doing in support of the five pillars of the National Export Initiative.
Intro to Manufacturing and Services
Just by way of introduction, Manufacturing and Services, -- the unit which I lead -- is one of four units in the International Trade Administration otherwise known as ITA. Our mandate is to closely collaborate with U.S. industry and serve as the ambassador for the U.S. business community to the federal government. In this regard, the Manufacturing and Services unit is uniquely positioned to help you enhance your global competitiveness.
We employ over 200 industry experts and economists who understand, monitor and advise policy makers on the drivers of U.S. industry’s competitiveness.
Let me give you some specific examples of how ITA is supporting the five pillars of the NEI in the clean energy sector.
Pillar 1 – Improving Advocacy and Trade Promotion
Advocating for U.S. businesses and trade promotion are two key components of our strategy.
ITA is actively promoting U.S. clean energy solutions. We have held trade events and foreign buyer programs at major renewable trade shows and brought delegations from all over the world to these events.
ITA has had an aggressive clean energy technology promotion program with over 90 trade events held worldwide in 2009 and many more planned for the rest of 2010-11. These are in addition to the day-to-day services we offer U.S. companies, such as tailored matchmaking and consulting services, international company profiles, and international partnership searches.
One particular program I’d like to highlight is ITA’s International Buyer Program, otherwise known as IBP, which recruits thousands of qualified foreign buyers, sales representatives, and business partners to U.S. trade shows each year, giving U.S. exhibitors excellent opportunities to expand business globally.
In the past year, ITA has held IBP events at two major energy trade shows. First, the IBP hosted nearly 1100 delegates at the 2010 Offshore Technology Conference in Houston, Texas and 13 delegates at the 2010 Electric Power Show. Next month, we will hold another IBP at Power Gen International, the largest power generation trade show in the world, in Orlando, Florida. Also next year in May, ITA will hold an IBP event at the American Wind Energy Association Windpower Conference & Expo in Anaheim, California.
Since January, the Commerce Department has coordinated an unprecedented 20 trade missions in 25 countries with more than 250 companies participating. These trade missions have resulted in an estimated $2 billion in increased exports. Just like IBPs, these programs help bring buyers and sellers together.
We have held a number of clean energy-focused trade missions. These include:
- a Solar Energy Trade Mission to India in March 2009,
- an Energy Efficiency Trade Mission also to India in November 2009,
- and in May of this year, Secretary Locke led the first Cabinet-level Clean Energy Business Development Mission to Hong Kong, other cities in China and Indonesia, focusing on solar, wind, power generation and distribution/smart grid, green building, and energy information services. I’m happy to report that this trade mission recorded over $20 million in initial sales and has already surpassed $30 million in sales over the last few months.
We also organize fora in which we work with foreign governments to help them understand how to create an “enabling environment” in which clean energy companies can be successful. For instance, in July 2009, we organized such a clean energy forum with Indonesia- a country blessed with huge geothermal resources- but with little commercial activity in this sector because the right incentives are not in place.
I also want to mention the upcoming Renewable Energy and Energy Efficiency Export Initiative, which was developed by an interagency working group that I co-chair with the Department of Energy.
The Initiative will be announced in the next few weeks and will demonstrate a renewed commitment to facilitate trade and investment in renewable energy and energy efficiency. In total, the Initiative includes 23 commitments for new programs or new actions from 8 separate U.S. government agencies – all of which will be done within existing budgets and existing authorities.
I now want to talk a moment about advocacy.
We can advocate on your behalf to foreign government counterparts to advance trade opportunities. Advocacy assistance promotes U.S. exports, supports U.S. employment and increases global market share for U.S. businesses. In many cases, advocacy counters foreign government support and political pressure, thus "Leveling the Playing Field" for U.S. companies.
Our “Advocacy Center,” has coordinated assistance for U.S. firms competing for international contracts and other U.S. export opportunities -- supporting an estimated $11.8 billion in export content, and an estimated 70,000 jobs.
Advocacy can take many forms. For example, last fall, the Department of Commerce was successful in convincing the Chinese Government to eliminate local content requirements on wind turbines at the U.S.-China Joint Commission on Commerce and Trade.
Previously, China required that wind turbines installed in China meet a minimum 70 percent local content requirement, which prevented U.S. companies – both large and small – from taking advantage of the fast-growing Chinese wind market.
By successfully eliminating this trade barrier, U.S. companies will now have access to the fastest growing wind market in the world, allowing U.S. companies to sell component parts, large turbines, and innovative wind turbine designs.
Keep our ability to advocate for you in mind, especially if your institution is interested in expanding into new markets and runs up against issues that we can take directly to a foreign government and help “level the playing field” for you.
Pillar 2 - Increasing Access to Export Financing
Financial institutions provide the “grease for the export engine” - the trade credit that enables exporters to obtain working capital and loans.
The vast majority of this credit is and will continue to be provided by institutions from the private sector. However, as you know, government trade finance agencies such as the Ex-Im Bank and SBA can step in to fill market gaps, providing support when there is greater real or perceived risk.
Importantly, over the past two years, private sector financing gaps for U.S. exporters have widened considerably. Ex-Im Bank has responded aggressively to fill this gap.
In fiscal year 2010, which ended September 30, Ex-Im financing totaled a record $24.5 billion, and supported an estimated $33 billion in export sales and 227,000 U.S. jobs.
My unit collaborates directly with Ex-Im Bank in their efforts to make more credit available. We are committed to increasing outreach to exporters, foreign buyers and bankers to build awareness of government assistance, and making it easier for exporters and other customers to use government credit programs by streamlining applications and internal processes.
Pillar 3 – Removing Barriers to Trade
We are deeply committed to opening the markets that matter most for U.S. clean energy industry. Through advocacy and trade diplomacy we also work on behalf of individual U.S. clean energy companies to persuade governments to provide equal access and honor trade commitments.
Let me give you some examples of what we have done.
With USTR and Treasury, we are working to provide greater access to the Chinese clean energy sector for U.S. companies. Through direct consultation, participation in high-level government and industry forums, we are working to ensure fair and equal access for U.S. clean energy firms.
We also have worked on clean energy issues under the U.S.-EU Framework for Advancing Transatlantic Economic Integration and the U.S.-Brazil Commercial Dialogue, and assessed the impact of foreign regulations, such as the European directive on energy-using products, on U.S. interests. We have many similar commercial dialogues with other countries including India and Russia.
Be assured that the Department of Commerce, USTR and other U.S. government agencies are dedicated to furthering trade agreements and opening key markets for U.S. exporters and the clean energy community.
Pillar 4 - Enforcing Existing Agreements
As we work to open new markets, we must ensure that our exporters have the opportunities they have been promised in prior agreements. Robust enforcement is both a short-term and long-term priority and an effective way for the Federal Government to help increase exports.
We are committed to redoubling our efforts to rigorously monitor and enforce existing free trade agreements to help ensure a level playing field for U.S. exporters.
In this year alone, the Commerce Department’s Trade Agreements Compliance Program has successfully addressed 50 different barriers to trade affecting U.S. businesses in 33 different markets, and has initiated action on behalf of U.S. exporters and investors in 120 different cases.
In some priority markets we use “dialogues” through high level government meetings such as the India Trade Policy Forum, Transatlantic Economic Council, and bilateral forums with China.
For others, we have utilized high level interactions between business leaders through dialogues such as the U.S. Brazil CEO Forum. These dialogues and working groups are important tools for ensuring a level playing field for U.S. exporters and service providers.
Pillar 5 – Promoting Strong, Sustainable and Balanced Growth
This final pillar of the NEI is led by my colleagues at Treasury. These last 18 months have been an effective period of international economic cooperation, with global growth replacing economic contraction. The United States is promoting strong, sustainable, and balanced growth in the global economy through its collaboration with members of the G-20.
Enhancing Public-Private Partnerships
Which leads me to mention a very important collaborative effort in support of the NEI – enhancing public-private partnerships.
As I have mentioned, clean energy partnerships are key for the success of the NEI and ITA’s Market Development Cooperator Program otherwise known as MDCP, and Strategic Partnership Program are excellent examples of how we can work together to deepen our outreach efforts to exporters.
The MDCP, which my unit manages, provides competitive grants to non-profit groups or universities who propose projects to open up foreign markets to U.S. exports. In fact, Industrial Fabrics Association based in Roseville, MN received a grant to pursue markets in South Asia, East Asia and the Pacific.
The MDCP boasts a great return on investment. In fact, ITA's $23.5 million investment since the commencement of the program has yielded over $2.9 billion in increased exports.
In 2009, we awarded three MDCP awards in the clean energy sector to the following groups: 1) El Camino College - to export renewable energy and environmental technologies to China and Hong Kong; 2) Colorado Office of Economic Development and International Trade - to export renewable energy and environmental technologies to China and Mexico; and 3) the National Electrical Manufacturers Association – to initiate standards efforts in Canada and Mexico to ensure interoperability of the electrical systems and Smart Grid operations by conducting standards harmonization efforts with standards bodies in all three markets.
This year, the Department has awarded additional MDCP awards in the clean energy sector. Recipients include: 1) the National Chamber Foundation - to assist with their efforts to export green technologies to Brazil and 2) World Trade Center San Diego - to assist with exporting water technologies and services to the Middle East, North Africa, and India.
Since 2009, the Department has issued almost $2 million in MDCP awards on clean energy export projects alone.
The MDCP has been an effective means to promote U.S. exports abroad, especially in the clean energy sector. One particular example I’d like to highlight is the International District Energy Association, which partnered with the Department as a cooperator in the MDCP from 2005-2009. Our cooperation with this group has contributed to the export of $263 million of U.S. clean energy technologies, principally to Middle East markets.
Secretary Locke and your very own Senator Amy Klobuchar will be hosting an open reception on December 1st at the Capitol Visitor’s Center in Washington DC to inform participants about the MDCP awards process and celebrate our recent award recipients. For more Information on MDCP, please visit our website at trade.gov/mdcp.
Further, through our Strategic Partnership Program, we are working to broaden and deepen the U.S. exporter base by leveraging partnerships with trade associations and private corporations. Through these innovative public-private partnerships, we are making companies that might not know about our programs aware of our trade promotion and related resources, and we are letting them know of global business opportunities.
We would appreciate your support in making critical programs such as the MDCP and Strategic Partnership Program a success.
In closing, through improving advocacy and trade promotion, identifying and communicating market opportunities, enhancing trade finance, negotiating trade agreements and greater market access, enforcement and the establishment of strong public/private partnerships, I am confident that we can meet the Presidents’s goal of doubling exports in 5 years to support 2 Million jobs.
But we can’t do this without you. U.S. companies and workers are among the most innovative and competitive in the world. They can provide the technology, services, and knowledge to lead the clean energy revolution of the future.
In clean energy it often goes unmentioned that the United States is the world’s largest market for wind, concentrated solar, waste-to-energy and geothermal energy. Many of these technologies were invented in the United States and have helped create thousands of American jobs.
Thanks to the investments made under the American Recovery and Reinvestment Act and the implementation of state-level policy incentives to promote renewable energy manufacturing, U.S. companies are now better positioned than ever to supply global markets with world-class clean energy technology and expertise.
What’s more, our trading partners are now looking to purchase U.S. products and expertise as they expand their clean energy generation potential.
The Department of Commerce is committed to helping our companies compete in these growing markets.
Please remember, as you work to expand markets for clean energy technologies and services, we at Commerce are hard at work and very much want to hear from you.
If there are issues affecting clean energy trade, I want to hear about them.
If you are not able to break into a key market, bring it to our attention.
If there are ways to more closely partner, perhaps share information so that we have, together, a better sense of how to boost America’s clean energy exports – I’d like to know about it.
Let me know how we can work more closely together.
Thank you for inviting me. I hope that you enjoy the rest of your conference.
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