Enhancing American competitiveness : a progress report to the President and Congress / Competitiveness Policy Council.

  • United States. Competitiveness Policy Council.
Date:
1993
Catalogue details

Licence: Public Domain Mark

Credit: Enhancing American competitiveness : a progress report to the President and Congress / Competitiveness Policy Council. Source: Wellcome Collection.

    35/48 (page 1)
    Introduction The US economy is part of an integrated world economy with exports and imports of goods and services equalling one quarter of America’s gross national product. This interrelationship between do- mestic and international economic matters is demonstrated by the fact that reducing the budget deficit will probably have a larger impact on reducing the trade deficit than any other single policy action. After some initial delay, execution of the Clinton Administration’s trade policy is on target, but more needs to be done to assure American eco- nomic competitiveness. The Trade Policy Subcouncil report, “A Trade Policy for A More Competitive America,” emphasized the need to shift American thinking on trade policy to encourage ex- ports. The report reflected the views of business, labor, government and public interest representatives, and focused on six main areas: global growth, exchange rate stability, trade negotiations, export financing, export promotion and removing export disincentives. The outcome of the G-7 Summit and the an- nouncement of the US-Japan Bilateral Framework in July, along Coordinating Committee (TPCC) “National Export Strategy” report to ining the Administration’s progress in these six areas. For the first several months of the Administration, its actions seemed slow at a time when the development of an export mentality throughout the government and pri- vate sector was imperative. Negotiations in the context of the G-7, the General Agreement on Tariffs and Trade (GATT), the North American Free Trade Agree- ment (NAFTA), and US-Japan Bilateral Framework now demon- Strate, however, that the Administration is advancing a global growth strategy and market opening efforts through multilateral and re- gional negotiations, both major themes of the Second Report of the Competitiveness Policy Council. Moreover, the TPCC report is implementing many of the Council’s specific recommendations for in- creasing export financing and promotion and reducing export dis- incentives, most prominently export controls. This export commitment is critically important at a time when expansion of overseas markets for US goods can help offset slow growth of the US domestic market. Global Growth Strategy and Exchange Rate Coordination The full Council and Trade Policy Subcouncil recommended G-7 initiatives which would sustain and enhance global growth as well as maintain a competitive exchange rate for the dollar. Fiscal stimulus was recommended to boost domestic demand in Japan. Fiscal tightening was recommended in Germany to facilitate lower interest rates there and throughout Europe. The Sub- council recommended that exchange rate coordination be built upon “‘ef- erence ranges” like those installed in the Louvre Accord in 1987 to make US goods more competitive and adjust the undervalued yen. The Subcouncil also recommended institutional reforms to facilitate coordination. At the Tokyo G-7 meetings held in July, the Clinton Administration took some significant steps, consis- tent with full Council and Trade Policy Subcouncil recommendations, to implement a global growth strat- egy. The United States pledged to cut