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Transatlantic Trade Policy and the Consumer
Susan G. Esserman
General Counsel, U.S. Trade Representative
Good afternoon. My thanks to all of you for coming today.
Let me begin by saying how pleased I am to be a part of this session
of the Transatlantic Consumer Dialogue. The TACD exemplifies the values
America and Europe share: democracy, transparent and accountable government;
citizen participation in policymaking.
Shared Values
These principles make America and Western Europe the most prosperous,
stable, peaceful and healthy societies in the world. Since the emergence
of the consumer and environmental movements of the 1960s and 1970s, they
have helped us develop domestic economies in which growth and prosperity
go together with clean air, clean water, healthy food and safe industrial
products.
Today, because of the work of these movements, our children are growing
up in cleaner, safer, healthier societies. Our families enjoy a higher
quality of life. Our workplaces and consumer products are safer. And while
we have much more to do, the environmental quality of our rivers, lakes
and wild lands are vastly improved over the past twenty years.
At this meeting of the TACD, we have an opportunity to draw lessons
and ideas for trade policy from this domestic experience. As we reflect
on the forces at work in the world economy very clearly - the revolutionary
changes in science and technology; the rapid growth of trade - our responsibility
is to find the right mix of policies that allow us to take advantage of
the opportunities they offer while ensuring that they support, rather
than erode, the advances our societies have made in the past decades.
And in trade as in domestic policy, the participation of civic groups
in making these policies, from beginning to end, is essential. We know
this from our experience in consumer protection and environmental policy
at home. And in a deeper sense, as citizens of democratic nations, we
know it is simply the right thing to do.
US-European Trade Relationship and Responsibilities
Both we and the Commission understood this in setting up the Transatlantic
Economic Partnership. Promotion of our shared values is one of the TEP's
crucial objectives, and the establishment of the Transatlantic Consumer
Dialogue was a fundamental part of our effort to reach the goal.
The TACD, to begin with, will help us immensely as we develop our bilateral
relationship and the multilateral trading system. Taking into account
trade in services and investment as well as trade in goods, ours is by
far the largest economic relationship in the world. Last year alone, our
bilateral goods trade topped $325 billion, and services trade is approaching
$150 billion per year. And with this economic relationship, we also have
set the highest standards in the world for food safety, product safety,
and other consumer protection measures.
Our goal in these discussions is to reduce barriers to trade, to develop
common ground, and to advance the values we share. In doing so, we will
not only ease bilateral relations, but set precedents for issues we will
address on a larger scale in the years to come: questions like technical
standards for industry, regulation of the service industries, and trade
in sectors at the cutting edge of medical, agricultural, information,
environmental and other technologies.
All of these new developments, of course, offer great opportunities
to consumers - as supermarket shoppers, as patients in clinics and hospitals,
as families taking vacations. At times, of course, they raise concern
as well. As we seek to take full advantage of the opportunities, and address
the concerns, the advice and ideas of consumer organizations is essential.
Over the next two days, the working groups will discuss some of the
most complex issues in detail: biotechnology, food safety, electronic
commerce. I would like to begin our discussion, however, with some thoughts
on the broader trends which these specific issues represent.
Development of Science
The first of these is the rapid and accelerating development of science
and technology.
This is perhaps the most fundamental question our bilateral relationship
must address: Europe and the United States, together with Japan, are at
the leading edge of the technological revolution, and our citizens are
affected by it more than those of any other country.
New technologies offer immense benefits for consumer choice and quality;
they have great promise for health, nutrition and freedom of information.
At the most profound level, they offer hope to create affordable cures
for disease and to reduce hunger and malnutrition; in daily life, better
prices, greater choice and higher quality through Internet comparison
shopping. But they also, especially in rapidly developing areas such as
food, medicine and information technology, may raise concerns. These must
be addressed through fair, transparent, accessible and professional regulatory
analysis and process based on the best available scientific evidence.
Let me note two issues here of special importance to trade policy and
our bilateral relationship:
- Electronic commerce allows consumers much easier access to goods
and services, reducing prices and vastly expanding choice. In the
years ahead, we will have to reach a consensus to ensure that government
action - for example, imposing tariffs on electronic transmissions
- does not erode these consumer benefits. Likewise, we will have find
a consensus on the proper ways to ensure the protection of privacy
and prevent fraud.
- Biotechnology, in the medical field, creates new medicines and allows
much greater and cheaper production of existing treatments like human
insulin for diabetes. In agriculture, it allows farmers and ranchers
to produce more efficiently and in larger volume on less land. This
offers the prospect of reducing hunger worldwide, and at the same
time lessening pressure on land, water and wildlife habitat. At the
same time - as we see in our trade relationship - it raises some public
concerns and requires us to develop sound, transparent and science-based
regulatory systems.
The important thing is that we react to with foresight, but also with
a sense of context. These developments are new, but they build upon a
very long history of similar developments. They are not science fiction
come to life. As we think about biotechnology, for example, we should
remember that virtually every type of food we now eat is genetically engineered
in some way, through selective breeding programs for plants and animals
dating back thousands of years and through the Green Revolution of the
1950s and 1960s. Likewise, electronic commerce and the opportunities it
creates are not so unlike the invention of mail-order marketing a hundred
years ago.
Thus, these developments require foresight, but also appreciation of
their potential benefits. Essential to a successful response is reliance
on objective scientific criteria in regulation and approval. This ensures
fairness for producers and the best guarantees for consumers.
Such an approach may be the correct approach to labeling. Here, we
feel that food labeling should be based fundamentally on health and safety
considerations. From the perspective of food safety, a product of biotechnology
should not require additional labeling unless there are scientifically
established issues of safety, such as the introduction of a known allergen,
or a significant change in nutrients or composition. In these cases the
specific change is the subject of a label, rather than the process by
which it is produced. On the whole, we do not see a good reason for the
mandatory labeling of a food product simply because it is made from genetically
modified inputs. Thus our Food and Drug Administration applies the same
labeling requirements to biotechnology products as to all other food products.
On the other hand, consumers should have information on the scientific
facts about biotechnology so that they can make informed decisions about
use of genetically manufactured organisms in food products. These are
educational goals we share, and we encourage pamphlets and directed information
campaigns to achieve them. Voluntary food labeling, as long as it is truthful
and not misleading, of course, can also provide useful information to
consumers.
Integration of Developing Economies
The question of food safety also raises a second issue: the growing
integration of the developing world into the trading system.
In the years ahead, we will face a series of questions relating to
our growing trade with the developing regions - including, from the consumer
point of view, how to ensure high standards of safety and consumer protection
in trade with nations whose own regulatory systems are at times less developed.
As with the scientific and technological revolution, this trend is,
on the whole, immensely positive and beneficial. Economic development
and participation in trade, especially in Latin America and Southeast
Asia, has meant more democracy, less instability and fewer wars. Those
nations which have isolated themselves from world trade tend to stagnate.
In the saddest and most dramatic example, the Korean peninsula was one
country fifty years ago - today South Korea is one of the world's leading
industrial powers and North Korea, which tried to wall itself off from
the world economy through a "self-reliance" or "juche"
philosophy, now suffers from chronic famine.
From the consumer standpoint, the integration of developing countries
has immense implications. In goods trade - especially in consumer goods,
including toys, apparel, footwear and other light manufactures; but also
agricultural commodities and increasingly in processed foods - developing
countries have a large and growing share of trade. For developing countries,
this means jobs and growth; for consumers in Europe and America, greater
choice and better prices.
Accompanying these benefits, however, are challenges we must take up
in trade policy. From the consumer standpoint, as we have access to more
choice at better prices, we also must meet challenge of ensuring that
our trade partners live up to strong food safety and product safety standards
- for the sake of their own people as well as for our consumers. We must
work to ensure that trade and growth are accompanied by rising environmental
standards both in developing countries and in the global commons. And
we must also seek to ensure that industrialization is accompanied by safe
and healthy working conditions, and in particular the protection of children
from sweatshops and other forms of abuse; which our Administration is
working hard to do, generally through cooperative bilateral programs and
the International Labor Organization.
At the same time, it is our responsibility to offer meaningful and
growing access to our developing trade partners. This must include 21st-century
efforts like ensuring Internet access for developing countries, which
helps in the development of micro-enterprise by helping artisans and small
businesses find customers and deal more easily with paperwork. And it
must include a commitment to remaining open to their agriculture and traditional
industrial goods.
The United States has taken up this responsibility in a number of ways
- our legislation to give additional benefits to Africa; the Free Trade
Area of the Americas process; the next WTO Round; and sectoral liberalization
initiatives like the one begun in APEC last year and now at the WTO. This
last initiative deserves special mention, because it can be completed
very quickly with help from Europe. It will create growth and jobs in
both industrial and developing nations by opening sectors of great importance
to developing countries - for example toys, gems and jewelry - and sectors
like environmental services and medical technology which support health
and sustainable development.
Participation of Citizens
The third and final broad trend is the growing participation of citizens
in trade policy.
As trade grows, and affects the daily lives of Americans and Europeans
more deeply, citizens will want to contribute to trade policy. Likewise,
the institutions of trade - especially the WTO - must be accessible, transparent
and accountable for their actions if they are to inspire public confidence.
Any perceived secrecy will breed distrust, raise suspicions of insider
deals that disadvantage ordinary people, and ultimately weaken the institutions
themselves.
That is why we have made transparency at the WTO - early publication
of decisions and documents, the right to file amicus briefs in disputes,
and the opening of dispute panels to public observers - a top priority
as we approach the Ministerial Conference this November, and very much
hope for the Commission's support. President Clinton, in fact, has made
a standing offer to open any dispute panel involving the United States
to the public, if our dispute partner agrees. Here we share general goals
with the EU, but it has been difficult to get European consensus on an
approach that delivers real progress by the Ministerial. We will need
continued support from consumers to help us get there.
This is not only an issue we take up at the WTO, however. The Transatlantic
Consumer Dialogue, is of course, an ideal example as well. As I said at
the outset, both the Clinton Administration and the Commission appreciate
the value of citizen contribution to policy - as a practical method of
improving public policy, and as a fundamental ethical value at the heart
of democracy.
Conclusion
And with that said, I will close my remarks - because what is most
important in the next few days is that those of us representing governments
hear from you. We have a great opportunity here to get new ideas, to address
disputes and misunderstandings, and to develop broad areas of consensus
and common ground.
Thus, speaking for the U.S. delegation, I look forward to the advice
and ideas each of you has brought to this meeting, and to the work of
the days ahead.
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