UNIVERSITY OF PENNSYLVANIA - AFRICAN STUDIES CENTER
USA: Africa Trade and Globalization Opinion
Date distributed (ymd): 991206
Document reposted by APIC
Issue Areas: +economy/development+ +US policy focus+ Summary Contents:
This posting contains two separate documents from November 1999 related to U.S. trade with Africa and U.S. public opinion on globalization. The first is a press release from the U.S. International Trade Commission announcing the Fifth Report on U.S.-Sub-Saharan Africa Trade (the full report is available, in PDF format only, at ftp://ftp.usitc.gov/pub/reports/studies/PUB3250.PDF). This report shows declines from 1997 to 1998 both in total two-way trade and in U.S. investment going to Africa, but an increase in U.S. exports to African countries.
The second document, from the Program on International Policy Attitudes, consists of brief excerpts from a report on U.S. Public Attitudes on Globalization. The report shows that the U.S. public is broadly supportive of trade expansion, but only if there is protection for other values such as jobs, the environment and the interests of developing countries.
U.S. International Trade Commission
November 17, 1999; News Release 99-159
ITC RELEASES FIFTH REPORT ON U.S.-SUB-SAHARAN AFRICA TRADE
The U.S. International Trade Commission (ITC) today released U.S.-Africa Trade Flows and Effects of the Uruguay Round Trade Agreements and U.S. Trade and Development Policy, the fifth and final report in a series intended to assist the President in developing a comprehensive trade and development policy for the countries of Africa.
The ITC, an independent, nonpartisan, factfinding federal agency, conducted the investigation for the United States Trade Representative (USTR) under the Africa Policy Section of the Statement of Administrative Action that Congress approved with the Uruguay Round Agreements Act.
As requested by USTR, the ITC's study is limited to the 48 countries of Sub-Saharan Africa. The current report provides an update for 1998 on U.S.-Africa trade and investment flows in major sectors; an identification of major developments in the World Trade Organization (WTO) and in U.S. trade and economic policy and commercial activities that significantly affect bilateral trade and investment with the region; information on changing trade and economic activities within individual countries; and an update on progress in regional integration in Africa. Following are some highlights of the report:
* For the first time in four years, total two-way trade between the United States and the region declined. It dropped from $22 billion in 1997 to $19.9 billion in 1998, a drop of almost 10 percent. The main reason for this decrease was a 28 percent drop in the value U.S. imports of Sub-Saharan energy-related products (principally crude petroleum), by far the greatest contributor to total U.S. imports from the region.
* The sharp decline in the value of U.S. oil imports from the region translated into a major improvement in the longstanding trade deficit with Sub-Saharan Africa. The deficit totaled $6.8 billion in 1998, down from almost $10 billion the previous year.
* Total U.S. merchandise exports to the region in 1998 rose by 7.4 percent to $6.5 billion, up from $6.1 billion in 1997. Total U.S. imports from the region fell 16.5 percent in 1998, from about $16 billion in 1997 to $13.4 billion in 1998.
* The largest share of U.S. exports to the region is in the transportation equipment sector, accounting for 34.2 percent of the total in 1998 and 28 percent in 1997.
* Nigeria is the largest supplier of U.S. imports from the region, with almost $5 billion in sales (predominantly energy-related products) to the United States representing 36 percent of the region's total merchandise exports to the United States in 1998.
* Generalized System of Preferences (GSP) imports from Sub-Saharan Africa increased dramatically in 1998, up 73 percent from $1.4 billion in 1997 to $2.4 billion. Angola has surpassed South Africa as the largest Sub-Saharan African GSP import supplier to the United States. Duty-free GSP imports from Angola grew by 135 percent in 1998.
* U.S. service exports to Africa increased by 12.2 percent in 1997. Tourism was the leading U.S. service export to Africa in 1997, accounting for 29 percent of the total; this was followed by professional services with 24 percent, freight transportation with 10.9 percent, and education with 10.6 percent. The largest U.S. trading partner for services is South Africa.
* Sub-Saharan Africa received about $4.8 billion in foreign direct investment (FDI) flows in 1998, a decline of about 8.3 percent from the previous year. This decline was due, in part, to the fact that South Africa's strong performance in privatization in 1997 was not sustained.
* Global FDI to developing countries declined by 5 percent to $154.9 billion in 1998; Sub-Saharan Africa's share of that amount also dropped slightly to 3.1 percent in 1998, down from 3.2 percent of total investment to developing countries in 1997.
* U.S. gross direct investment to the region declined by 43 percent, from $3.8 billion in 1997 to $2.2 billion in 1998.
* Some U.S. government programs directed toward Sub-Saharan Africa increased in 1998, compared to the previous year. Total U.S. bilateral economic assistance to Sub-Saharan Africa increased from $998 million in fiscal year 1997 to $1.1 billion in fiscal year 1998.
* In 1998, several Sub-Saharan African countries continued to increase their efforts to avail themselves of WTO benefits and other programs aimed at improving their trade performance. A number of countries received multilateral assistance through the WTO Trust Fund for Technical Cooperation -- where 1998-99 contributions worth $4.5 million are used to fund instruction for officials of less developed countries.
U.S.-Africa Trade Flows and Effects of the Uruguay Round Trade Agreements and U.S. Trade and Development Policy (Investigation No. 332-362, USITC Publication 3250, October 1999) will be available on the ITC's Internet server at www.usitc.gov. A printed copy may be requested by calling 202-205-1809 or by writing the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW, Washington, DC 20436. Requests may also be faxed to 202-205-2104.
Americans on Globalization: A Study of US Public Attitudes from the Program on International Policy Attitudes, A joint program of the Center for the Study of Policy Attitudes and the Center for International and Security Studies at Maryland, School of Public Affairs, University of Maryland (http://www.pipa.org).
Summary of Findings (excerpts only: for full text see http://www.pipa.org/OnlineReports/Globalization/global_rep.h tml)
November 16, 1999
Principal Investigator: Steven Kull
... To explore in depth the American public's attitudes toward these questions, the Program on International Policy Attitudes (PIPA) conducted three focus groups and a nationwide poll. The focus groups were held in Dallas, Texas; Battle Creek, Michigan; and Baltimore, Maryland. The poll was conducted October 21-29, 1999, with 1,826 randomly selected adults (weighted to be demographically representative). The margin of error ranged from +/- 2 to 4%, depending on the portion of the sample that heard the question, with most questions at the 4% level. An extensive report on this study, including a comprehensive review of all existing poll data on this subject, will be forthcoming. ...
Globalization in General
1 Overall, globalization is seen as somewhat more positive than negative. A large majority favors moving with the process of globalization and only a small minority favors resisting it. Americans view globalization as a process of the world becoming increasingly interconnected. It is seen not only as an economic process, but also as one in which values are becoming more oriented to a global context and international institutions are playing a more central role.
Overall, it appears Americans view globalization as having a mixture of positive and negative elements, with the positive elements just moderately outweighing the negative ones. ...
2 In principle, a majority of Americans supports the growth of international trade. However, the benefits of trade to date are seen as barely outweighing the costs for most sectors of society, except for the business community. A strong majority feels trade has not grown in a way that adequately incorporates concerns for American workers, international labor standards and the environment. ...
Trade Seen as Producing Little Net Gain
Despite fairly strong support for trade in principle, a majority felt that to date the benefits of trade have barely outweighed the costs for most sectors of society, except for the business community.
The effect of international trade on jobs also was seen as fairly neutral. Asked how many jobs international trade generates and how many it costs, respondents were almost exactly divided, with 46% saying more were gained and 45% saying more were lost. ...
Overall, Americans seem to feel that US trade policymakers adequately consider commercial interests, but an overwhelming majority feel that other sectors of American society get short shrift. Asked about "US government officials who are making decisions about US international trade policy," 54% said they consider the concerns of multinational corporations "too much," while for "American business" responses were evenly distributed among too much, too little and about right. However, overwhelming majorities said US trade policymakers were giving "too little" consideration to "working Americans" (72%), the general public (68%) or "people like you" (73%). ...
The World Trade Organization (WTO) did not fare much better than the US government. Sixty-five percent agreed that, "When the World Trade Organization makes decisions, it tends to think about what's best for business, but not about what's best for the world as a whole."
Consistent with this view, a majority of 56% said they thought "The growth of international trade has increased the gap between rich and poor in this country." Only 10% said trade has decreased the gap, while 27% said it has had no effect.
Want Other Concerns to Be Incorporated
Given these perspectives, it is not surprising that Americans want the process of trade liberalization to incorporate other concerns, such as the needs of American workers, international labor standards and the environment. ... An overwhelming 88% agreed with the following statement:
Increasing international trade is an important goal for the United States, but it should be balanced with other goals, such as protecting workers, the environment, and human rights - even if this may mean slowing the growth of trade and the economy. ...
Readiness to Limit Trade for Other Values
Americans also show a substantial readiness to limit trade in support of other values. Respondents were introduced to the issue of trade sanctions with a statement that underscored the arguments against limiting trade with countries that do not live up to certain international standards, saying "Some people say...it is not the US's right to make these judgments, that limiting trade interferes with the general process of opening up trade, that such limits are rarely effective, and that they cost the US business and thus jobs."
Nonetheless, in every case a strong majority favored limiting trade as a means of pressuring countries to change their behavior. ...
Americans even show a remarkable receptivity to the idea that barriers could be applied to US products in the name of various concerns. Although the American position was clearly articulated in each question, a majority said they regarded it as legitimate to put up barriers to genetically modified foods (81%) and beef grown with hormones (58%), based on health concerns. A plurality (50%) saw it as legitimate for Europeans to favor bananas from their former colonies over US companies, based on historical obligations. ...
Concerns for American Workers
2A Most Americans feel that American workers are not benefiting from the increase in international trade and that their needs are not being properly addressed by US policymakers. Most Americans put a higher priority on preserving the jobs of workers than on lowering consumer prices through trade. Even the higher-wage jobs that trade may bring are not clearly seen as offsetting the disruptive effects of losing jobs. A strong majority felt the US government has a responsibility to aid workers who lose jobs because of trade and that the government should do more to retrain and educate workers. If the government were to undertake such efforts, an overwhelming majority said it would then support increased trade. ...
Even when it was emphasized that trade may generate new jobs with higher wages, a majority did not feel this offsets the disruption for the workers who lose their jobs. Asked to choose between two statements, 56% chose the one, "Even if the new jobs that come from freer trade pay higher wages, overall it is not worth all the disruption of people losing their jobs." Forty percent chose, "It is better to have the higher paying jobs, and the people who lost their jobs can eventually find new ones."
Concerns for jobs makes Americans relatively wary of entering into trade agreements with low-wage countries. As mentioned, 64% said that if another country is willing to lower its trade barriers to US products, the US should be willing to lower its trade barriers; but only 50% said they would be willing to enter into such an agreement with low-wage countries. ...
Mitigating the Effects of Trade on Workers
A strong majority felt that the US government has the responsibility to help workers adjust to the changes that come with international trade and the government should be doing more ... When the possibility of helping workers adapt to changes associated with increased trade is considered, support for free trade becomes overwhelming.
Similarly, an overwhelming 87% agreed (56% strongly) with the statement, "I would favor more free trade, if I was confident that we were making major efforts to educate and retrain Americans to be competitive in the global economy." Only 11% disagreed.
Concerns for Labor Standards
... Americans overwhelmingly support the view that international labor standards should be incorporated into trade negotiations. Respondents were offered two arguments for, and two against, the idea that "countries who are part of this [trade] agreement should be required to maintain certain standards for working conditions, such as minimum health and safety standards and the right to organize into unions."
Concerns for the Environment
2C Americans overwhelmingly support the view that there should be more international agreements on environmental standards. A very strong majority rejects the WTO's current position that countries should not be able to restrict imports based on the environmental effects of their production. ...
77% (48% strongly) felt there should be more international agreements on environmental standards.
In a series of questions, an overwhelming majority showed very strong support for having more international agreements on environmental standards.
Globalization of Values
Respondents showed very strong support for the idea that increasing economic involvement with other parts of the world increases Americans' responsibility to address moral issues in those countries. Seventy-three percent agreed: "As we become more involved economically with another country... we should be more concerned about the human rights in that country." An overwhelming majority also felt this principle applies to working conditions. ...
Helping Poor Countries
3B Most Americans perceive poor countries as not benefiting from the increase of international trade and support giving poor countries preferential trade treatment. Very strong majorities believed that the US has a moral obligation to promote development in poor countries and that doing so ultimately would serve US economic interests.
Americans are highly supportive of various ideas for extending the benefits of globalization to poor countries. An idea currently under discussion at the WTO for giving the poorest countries preferential trade treatment received strong support, even when it was suggested that it might threaten some American jobs. ...
Support for helping poor countries is prompted by moral and self-interest motives. A strong 68% agreed (31% strongly) that, "the United States has a moral responsibility toward poor nations to help them develop economically." At the same time, strong majorities thought that "in the long run, if developing countries do become stronger economically," this would have a positive impact on "US business opportunities in developing countries" (74%), "the US economy" (70%), and even "jobs in the United States" (63%).
[The question asked was:] Giving the Poorest Countries Preferential Trade Treatment
"Currently, there are no efforts to find ways to help the very poorest countries... One idea being discusssed is for the wealthier countries to allow in more of the products from these very poor countries. Some say that this would be a good idea because it would help these poor countries get on their feet, and, because their imports would still be no more than one percent of all imports, it would cost the wealthy countries very little. Others say that allowing in more goods from these very poor countries is a bad idea because it might threaten jobs of American workers producing the same kinds of products. Do you think [this] is a good or bad idea?"
Message-Id: <199912062228.RAA02408@fb00.eng00.mindspring.net> From: "APIC" <firstname.lastname@example.org> Date: Mon, 6 Dec 1999 17:26:24 -0500 Subject: USA: Africa Trade and Globalization Opinion
Editor: Ali B. Ali-Dinar
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