Thank you Chairman Sarbanes, Senator Gramm and members of the Committee, for providing this opportunity for TDA and the other members of the TPCC to come before you today.
The last time we were before you was on October 2 of last year, shortly after the attacks of September 11. Now, six months later, I think it is even more clear that trade promotion efforts, such as those we are discussing here today, are vital to U.S. – and global – economic and political security. In particular, our ability to foster development in and trade with the Front Line States, with countries in South and South-East Asia, and with struggling markets in Africa, will go a long way toward promoting international stability.
To begin, let me first express my appreciation to Secretary Evans, Undersecretary Aldonas, and their staffs for the tremendous amount of work that they have put into the TPCC process in the past seven months. They are to be commended for their proactive efforts to discern the needs of the exporting community and to develop specific strategies to respond to those needs. TDA has been an active participant in those efforts and we look forward to continuing this role as we face the future challenges and implement the many ideas contained in the report.
The report contains a number of specific proposals pertaining to TDA, and I will outline them in a moment, but since TDA does not regularly appear before this Committee, I would like to quickly take a moment to reiterate TDA’s mission and activities.
As directed by statute, TDA promotes American private sector participation in developing and middle-income countries, with special emphasis on economic sectors that represent significant U.S. export potential. TDA is a small, nimble agency that partners with U.S. companies and assists them in building mutually beneficial relationships with overseas projects sponsors and government officials. The result is increased U.S. exports and jobs as well as the completion of high quality, successful projects and other solutions that address priority developmental needs in host countries.
Thus, TDA’s goals are two-fold: helping American businesses export their products, and thereby creating jobs, while simultaneously promoting commercially viable economic growth in developing and middle-income countries. TDA’s dual trade and development mission allows it to serve as an essential catalyst for priority development around the globe through support of key infrastructure projects and capacity building initiatives.
TDA’s operations put it at the forefront of U.S. foreign and trade policy, where it works in concert with a wide array of other U.S. government agencies, such as the Departments of State, Commerce, Treasury, Agriculture, Energy and Transportation, the U.S. Trade Representative, the Export-Import Bank of the United States and the Overseas Private Investment Corporation. Thus, TDA works together closely with the other TPCC agencies on a regular basis, in the normal course of its business.
TDA’s role is to ensure that there are early successful demonstrations that U.S. policies result in viable and mutually beneficial economic growth. This demonstration of U.S. support has the direct effect of increasing exports of U.S. goods, services, technology and expertise. TDA accomplishes its mission using a number of early project planning tools, including the funding of various forms of technical assistance, feasibility studies, detailed design and engineering, orientation visits, specialized training grants and conferences. TDA utilizes its tools creatively, tailoring its flexible resources to fit the particular needs of specific opportunities. The agency thereby achieves two results -- assisting U.S. businesses as they compete for infrastructure and other development projects in highly competitive, emerging markets, and offering tailored solutions to foreign governments in need of effective commercial-sector development assistance.
Turning to the TPCC report, there are a number of recommendations that involve TDA. Since my colleagues have already identified many of them, I will simply highlight a few key recommendations.
First of all, we will continue to focus on developing coordinated strategies in crisis regions. For example, TDA has been working closely with OPIC in developing potential projects in Afghanistan, particularly in the telecom sector. In fact, TDA is already providing funding for an advisor to the communications ministry, to assist them with evaluating
proposals for the sector. This work is also being coordinated with the State Department Office of International Communications and Information Policy and with USAID. We also have been working closely with Commerce and the FAA in developing a technical assistance program for the aviation sector in Afghanistan that will support U.S. commercial interests. Similarly, we have worked with Ex-Im Bank in identifying projects in Uzbekistan that can be supported by TDA at the feasibility study stage and later by Ex-Im Bank guarantees. We will continue to work with other TPCC agencies to develop coordinated strategies in Afghanistan and other crisis areas.
In addition, as recommended by the exporting community, TDA will explore opportunities to fund front-end engineering and design studies, which are commonly referred to as FEED studies. Other countries sometimes fund such studies as part of aggressive efforts to win large development projects, and TDA will initiate a pilot program to support U.S. companies who are confronted with this type of competition.
TDA will continue working with other TPCC agencies on designing a pilot project to support capital projects in traditionally commercially nonviable sectors, such as the environment, renewable energy, health care and water. TDA is active in all of these sectors, and will coordinate with the other TPCC agencies to further expand opportunities for U.S. businesses.
TDA also looks forward to continuing its efforts in the area of biotechnology. We continue to work with USDA, USTR and the Department of State to support public-private partnerships that help promote sound regulatory environments overseas for American biotech products. These efforts are crucial for ensuring that our trading partners continue to allow the import of American pharmaceutical and agricultural products.
Additionally, TDA will continue to develop strategies for supporting efforts in the service sector, such as in insurance, banking/finance, tourism and e-commerce. For example, TDA has been supporting feasibility studies and technical assistance for projects around the world involving e-commerce. Two weeks ago TDA signed a grant with Sinopec, China’s leading petroleum and petrochemical company, for a feasibility study to help develop an e-trade platform, putting all of the company’s procurement activities online. The study would show Sinopec how to manage and finance its e-procurement investments, as well as how to prepare its management for the organizational requirements demanded by the new system's implementation. Not only will this lead to a potential of $23 million in direct U.S. exports associated with setting up the system, but will also make their procurement process more efficient and transparent, further increasing the likelihood that U.S. companies will be successful in doing business with Sinopec in the future.
The TPCC report identifies exporters’ desire that the trade agencies provide better access to information and to streamline data collection, such as with the application process. TDA is currently revamping its computer system, moving to a web-based system that will both allow our staff to work with data more efficiently and provide better access for U.S. companies to TDA information and activities. We are scheduled to have this system operational later this year.
In sum, TDA will continue to work closely with the TPCC and its member agencies in making sure that U.S. policy objectives are supported by concrete results, and that U.S. companies have the support they need as they operate around the world. This obviously is of benefit to the U.S. economy, as it supports exports and creates U.S. jobs. But equally importantly, the dissemination of U.S. goods, technology, services and business practices around the world represents a cost-effective, market-based means of effectuating the President’s strategy of supporting economic growth and development in developing countries.
Again, I appreciate the opportunity to again appear before you and look forward to answering any questions you may have.
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