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II. New Economy -
Opening Markets and Expanding Trade
President Clinton understands that future prosperity in the United
States depends on our ability to compete and win in the global
economy. He has steadfastly and consistently worked to open foreign
markets and expand trade -- to create jobs here at home.
Twenty-seven percent of our economy is now dependent on trade. Over 11
million workers in this country owe their jobs to exports. These jobs
pay higher wages, on average, than jobs not related to trade. Clearly,
expanding trade is critical to our effort to create good, high-wage jobs.
January 1, 1994 marked the launch of a historic trade agreement between
the United States, Canada,and Mexico. The North American Free Trade
Agreement will reduce barriers to U.S. exports in our first and
third largest export markets and expand opportunities for U.S.
businesses and workers. It forges a partnership with our neighbors that
fosters prosperity for all three nations.
The Uruguay Round to the General Agreement on Tariffs and Trade is the
largest, most comprehensive trade agreement in history. It will cut
foreign tariffs on manufactured products by over one-third overall -- a
$744 billion global tax cut -- and eliminate tariffs in major markets in a
number of sectors in which the United States is particularly competitive.
It will extend world trade rules to services, such as engineering and
construction, greatly expand export opportunities for U.S. agricultural
products, and level the playing field by binding all nations to the same
Japan is our second largest trading partner and the second largest economy in
the world. Yet sixty percent of the entire U.S. trade deficit is with Japan.
Clearly that deficit is the result of barriers to U.S. and other foreign
goods in the Japanese market. Determined to open the Japanese market,
President Clinton set our negotiations with Japan on a new course under the
Framework Agreement in July 1993. Since then, we have reached 14
agreements with Japan which have expanded opportunities for U.S.
businesses and firms and fostered job growth. Improving our trade
relationship with Japan and leveling the playing field has been -- and
will continue to be -- one of our highest priorities. That is why we
stood firm and won an agreement to open Japan's auto and auto parts
market to competitive foreign products.
We are determined to remove barriers to trade that unfairly inhibit the export
of quality American goods.
China is increasingly important as a market for U.S. goods and services
and as a major exporter. Sweeping economic reforms have contributed to
an explosive growth of income and trade. Yet China remains a closed
market to U.S. exports and our trade deficit with China has grown,
reaching $29 billion in 1994. We are committed to opening China's market
and to ensuring that they follow international trading rules. In
February 1995, we concluded an agreement which will provide protection
in China of intellectual property rights for U.S.
companies. Bringing China into the international trading system will
foster growth in both countries and assist China in becoming a more
open, democratic country.
Asia Pacific Economic Cooperation
The Asia Pacific region has the fastest growth in the world -- three
times the rate of the established industrial countries. By the year
2000, the East Asian economies will form the largest market in
the world, surpassing Western Europe and North America. This growth has
led to an explosion of trade with the United States. East Asia is the
number one export market for U.S. products. Our
exports to Asia account for over 2 million jobs in the United States.
President Clinton has pressed to expand trade with this vibrant region.
In November 1994, leaders of the APEC nations
agreed in Bogor, Indonesia to eliminate barriers to open trade in the
Asia Pacific region by 2020.
Free Trade Area of the Americas (FTAA)
Latin America is the second fastest growing economic region in the
world. U.S. exports to Latin America jumped from $30 billion in the
mid-1980s to over $90 billion in 1994, creating over
600,000 new U.S. jobs. U.S. exports to Latin America now approximate our
exports to the European Union, and, if trends continue, may reach $232
billion by 2010, greater than our combined exports
to the E.U. and Japan. Recognizing these opportunities, President
Clinton hosted the Summit of the Americas last December in Miami, the
first time in 30 years that the nations of this hemisphere have gathered
together. The 34 democratically elected leaders agreed to construct The
Free Trade Area of the Americas, or FTAA, by the year 2005.
Forging trade agreements to open foreign markets is just one part of the
effort. We must also make it easier for companies to
export. Through the National Export Strategy, the Clinton Administration
has liberalized controls on the export of over $32 billion of computers;
facilitated the promotion of exports through
one-stop shops, which provide information on all Federal export
promotion programs; coordinated a strategy to secure more than 70
contracts worth more than $17 billion for U.S. firms; and sought
to expand trade finance programs that means more American jobs in
hi-tech and manufacturing industries.