California Has Much at Stake in World Trade Talks, Report Notes
Complex trade talks are going on in exotic and faraway places, but their outcome will be felt close to home, where world trade now accounts for 18% of California’s economic activity.
In an attempt to help California businesses understand how they may be affected by trade rule changes, the California State World Trade Commission and the California Council for International Trade have published a booklet on issues under negotiation at the Uruguay Round of talks under the General Agreement on Tariffs and Trade.
Noting that California’s economy is the sixth largest in the world and that 11% of the state’s employment is trade-related, the report said: “Global interdependence has stripped away the insulation that California, and indeed the United States as a whole, has enjoyed in the past from international economic events.”
The report said the outcome of the trade talks will directly affect the ability of California companies to compete both at home and abroad, so they must consider how GATT issues may affect their domestic and overseas marketing plans. The California World Trade Commission also is encouraging businesses to help identify trade and investment barriers. It has placed a full-time representative in Washington to work directly with U.S. negotiators who are taking part in the GATT talks.
The report outlines the significance of various issues under consideration.
For example, the United States is firmly attempting “to put an end to the chaos in trade in agriculture,” which is the result of non-tariff barriers, widespread use of export subsidies and dumping of agricultural products worldwide.
California, the nation’s leading agricultural producer and exporter, stands to benefit from the removal of non-tariff barriers. But GATT talks will require “the United States to lay its own programs on the table,” the report noted, warning state agricultural producers to “scrutinize the various types of government assistance, marketing orders and export-enhancement programs that they presently enjoy to fully appreciate what may be at stake.”
Another important U.S. goal is to protect so-called intellectual property rights in copyrights, patents and trademarks. The move is designed to eliminate imports of counterfeit products--many of them shipped through California--and the infringement of a variety of intellectual property rights, including movie and record copyrights. The report explains that such protection is a top priority for California as the world leader of the “idea industry.”
Trade in services, including transportation, banking, insurance, engineering, construction, advertising, tourism, motion pictures and legal services, is another top U.S. priority because the service sector now dominates the U.S. economy. Greater access to these businesses worldwide could represent important opportunities to California businesses, the report noted.
