Good morning a wonderful way to start of monday working on issues that our more important or topical and that is why people want to be here but everybody will want to have questions if you have a question and fill out the card. It to get that broadest diversity of questions and then scott will be working so we will go as fast as possible. Is something should happen follow my instructions. In those that go down close to this and then take to lefthander in san across. We will celebrate our survival with i. C. E. Cream. We will be just fine. I am not competent to introduce u. S. Treasury secretary fortunately i have those who are one is a close personal friend that one of the things he is most interested in is a trade representative and his office could come up to make a formal introduction. [applause] good morning there are two other ambassadors he could take care of. [laughter] i was privileged to hold this job a long time ago. It used to say economics are Economic Policy a bit isnt a fair shot but in with a fundamental truth in the strait of this country and the source of our strength in the moral strength. And opening a door and with some Free Trade Agreements and when you are working with congress in then to work with the staff director of the Senate Finance committee so when he was given with president reagan in this case it was the combination of those who have worked together but what made me comfortable about this nomination is having worked with him as a intelligent and caring and thoughtful person that he is. In to do dozens of bilaterals. So a two hafnium with that background someone who knows the rules but there has to be a pattern for consistency. With the dead buteo. And then tour understatement it is fundamentally important part so it is with a great deal of pleasure to introduce somebody who i have a lot of respect. [applause] there are probably some friends out here in distinguished guest. What i was first asked to do this isnt something you can say no. What of the things i was reminded of when going from the staff director and were taking our trip together and then to fly from here urd to your. And on the first leg of the trip so what could that be . It was my passport. [laughter] so halfway through the dover to say i think i forgot something its my passport. He said no problem. Is simply to bring it the next day then us feel like such a jerk but he was very cool about it. He said he has forgotten his three times. [laughter] literally a true story. Everybody knows my affection for senator dole to be a great friend and a great teacher and dont think there is a title. Into a challenge to the orthodoxy in the running for congress and was not part of the establishment. The part of that 60s and 70s to party guy. And then some point to go through the details. In the not the most hospitable but also to do a great job of a balancing the obligations in to defend american interests industry and insisting on to get fair treatment and even like automobiles and the reason the Japanese Companies because of Ronald Reagan so reducing sat challenge that orthodoxy in todays contrarian myself. And then to sit down and take some questions. These are very Interesting Times for trade. And then to be eroding among electric in that has developed in recent years to workers and manufacturing and in 2016 with those Political Parties and candidates of the democratic side is senator sanders to campaign hard hell commit candidate was secretary clinton or for that matter her boss as secretary of state and and our side politicians can be accused of changing of the population if you go back 30 years or longer there is a consistency that is critical of the prevailing u. S. Trade policy so we will change of trade policy. So lets talk briefly about our philosophy. So the prevailing world trade policy and those that complain our economic progress it isnt a policy issue they believe that the voters are ill informed or to support that trade agreement in to im not of that group and the americans can compete successfully with anyone in the world and i believe like many of you market distortion encouraging fair competition to let the markets determine the economic outcome with the larger production of wealth many markets are not free or fair to determine the outcomes with regulatory restrictions so the real policy differences is not if we want the efficient markets but what is the face thing the best thing to do of distortions . I believe that we must be proactive and we must use all instruments we have and to convince the of trading partners we must to me and reciprocity. So to expect gene should court to have action in the president believes and i agree one can argue that too much emphasis could be put on specific bilateral deficits but i think it is reasonable to ask so globally with most countries of the world world trade is part of the problem. Tax rates and regulations in Macro Economic factors have a large part in the president is tackling these issues but also to determine outcomes. So a simple example how could one argue with the 2. 5 tariff . That is inconsequential to adjust taxes and we do not. Some countries continuously undervalue the currency. And then to export the same product and third i believed that is substantially more difficult but to subsidize to create National Champions in to distort the markets and that is unprecedented. With the wto and the predecessors and to successfully manage it we must defend our companies and workers and farmers we must find ways to insure a marketbased economy fails. And then to work to our benefit. The basic notion of a Free Trade Agreement is one will grant preferential treatment to a trading partner in return for equal amount of preferential treatment the object is to increase efficiency and it is reasonable to ask after a period of time whether what we receive were a the factors to renegotiate nobody will maintain that status quo and we have a different philosophy. I work look forward to working with people in this room and then to talk about progress as a move forward and look forward to answering your questions. [applause] good morning. Welcome to all of you here at the auditorium. We are delighted to have you here today without question this is the largest and most interesting cry and i have seen because to do appreciate everything you have done. In any case the ambassador has given time to interact because of a large crowd in the short time right your question on the three by five card to pass down the center aisle. Staff will pick that up i will put on my reading glasses to let you know, there is some preference so they give mr. Ambassador for doing this have a a question about trade agreements to have a conversation from a mission officials in the administration and that they prefer to have that environment moonset ask for a stable predictable period a time. What is that love all of support . First of all, to talk about any provisions so i would have to answer that. Carried out. Fair enough. You were in the administration with that change policy. So with private practice there was important changes to trade policy. But whole economy is totally different and there was no internet. We did not have so phones. Teefor multiples of that with china. Interestingly, i have the japanese committed to meet with me, and they say we have to send you back. Theyre very worried about it. So that is the principal challenge we face to me at least is how do we deal with china and a Global Trading system, how do we deal with china in the situation where we want market efficiency to dictate. Theres other challenges we have in trade agreements that we dont think a workout in our interest. We have to create rules that work well with Services Amid digital economy. To me the biggest challenge is really the appearance of china. Okay what about a policy on the theres been a key focus for arriving in asia and its vitally important to some major u. S. Firms because his home of the global middle class. Certainly in the Reagan Administration it would trade with japan. Soon after bush 41 buick characterize it as expanding membership also the formation of aipac which turned out to be reasonably reasonable institution. The bush 43 administration did Free Trade Agreements with singapore, australia and korea, the Obama Administration worked on the transpacific partnership. What is your thought about the trump policy . In the first place, we prefer bilateral trade agreements and the assumption is that if you have an 18 trilliondollar economy youll do better negotiating individually. I happen to agree with the president , not only can you negotiate better agreements but you can enforce them. Because usually in an agreement its difficult to enforce them because youre disrupting too many things in a bilateral thing i think you can. The policy will be to engage the countries in that region and in Bilateral Agreements we need to determine when will to so clearly this administration wants to staycation asia and we expect to do that. The one that has gotten a lot of attention since Prime Minister mae visited the white house is the possibility for a u. K. , u. S. Bilateral obviously the United Kingdom has matters to settle with their article 50 process that will take some time but in any case, what are your views on the bilateral with the u. K. , was the vision and how do you expect that to play out . I have met with doctor fox and talked about these issues. At the appropriate time i think the United States will have that process with the u. K. Im confident will come to an agreement thats beneficial to both parties. Thats probably a year or two off, even when its gonna happen its not quite clear until we know how the exit is going to go. Weve had meetings in talked about how we will perceive, the dont have confidence in that area is something on the horizon. At the appropriate time i think well have negotiation there and im sure it will be a successful one. Lets turn to the more lateral system for a minute the conference coming up in bonus are as this will can you tell us whats on the u. S. Agenda and more specifically what does the Trump Administration plan to do with the ongoing negotiation . First of all are in the process of all of these agreements and trying to make some decision as to which one would think our inner interest in which we want to pursue. Theres a study on that that will come out hopefully in another month or so. Our view is that its unlikely then administer will lead those negotiation. Theres some areas will be willing to engage. Hopefully well end up with a Good Conference and one that we decide what the upcoming agenda will be. And theyll be in agreement on that. Services are an important priority for the United States. We have a trade surplus and so thats an important part of what we want to encourage. An american companys even with the big services could be bigger if we had better rules and did not have countries blocking u. S. Exports. Thats a major thing for us. Ive had executives in talking to us and i have problems trying to move around the world. To continue with the wto. They free some objections with the way that bodies are formed in that process. Can you tell us more about what the u. S. Is trying to accomplish in terms of changing . There are a number of issues on which there is broad agreement that the wto understanding is efficient. And theres transparency issues. Theres issues with the staff, theres a lot of issues that we have a problem with. I think theres a general agreement that there are problems. Beyond that the United States sees numerous examples where the process over the years has really diminish what we bargain for our post obligations that we do not believe we reached it. Theres been cases with the trade laws that in my opinion the decisions are indefensible and even people have more freetrade orientation or question. We have tax laws struck down, weve had other provisions with the wto is taken. I think it took the position that they were going to strike down something they thought shouldnt happen rather than looking at these agreement as a contract. So what we tended to see is that as americans we say this is a contract and these are my rights. Others tend to think there is evolving governance and theres a different idea and i think sorting that out is what we have to do. It really things that were trying to evolve into its good for trade, thats one thing. If what youre gonna do is look at the exact words and say heres what was bargain when ambassador hill set down and negotiated she had a very precise idea of what it was that the United States was giving in anything that doesnt enforce that in that way is troubling. I think its evolved in a way that it creates new obligations and it has reduced a lot of our benefits. Says a fundamental part of the wto. It raises a lot of rate major issues. On a practical level with dispute settlement cases the two patterns of, the traders have cases on both sides which is not surprising and the respons resps that they win more than a coin toss. That means theres a selection of cases worth the prestige of the country since the u. S. Is involved in the cases and often is a respondent how do you think is a practical the decision i cases will affect the reform. To the extent that were objecting to the process is because we dont agree with the the way the appellate body has approach this and is not limited itself to precisely whats in the agreement. That is the nature of our complaint thats not to say that we dont win cases. Back when senator brock and i were there there is a system before and a system where you would bring the negotiation. Trade gruen we resolved issues eventually and theres a system that was successful for a long period of time. From my point of view what they want. The mechanism of using section 301. First of all it is an investigation so we have a hearing coming up on the tenth of october and then we will gather facts. Well decide what the situation is and if needed we will recommend a remedy to the president s we havent prejudged anything but there are complaints ceos commit to see me in almost every ceo at some point in the discussion will say that there have been a discussion with china. Forcing them to have new joint ventures and turning over and then in addition to that is the next their issue to that were looking at both of those things and will not prejudge it. Theres a lot to indicate theres a problem theres a real competitive advantage but they developed an enormous amount of intellectual property. In doing that for workers is very important. To me its a fundamental case why were using three oh one its an investigative tool. If there, if we turn up wto violations there are things that are not covered by trade agreements that we think are unreasonable and restrain u. S. Trade will try to devise other remedies that will get us to the point where we end up with Market Forces and efficiency. Briefly my Opening Statement we all want to get to the same thing. We have confidence that if we get to the point where were approaching Something Like freetrade the United States will do great. The question is, what you do to get there and do you have a different kind of approach or do you hope that if you talk about it people will see the light . Part of what i want to say about mild bosses he walked down both sides, he tried to do one and then did the other, hopefully well do that as we move forward. A question on nafta. Youre quoted saying that theyre going at warp speed. Its a great expression, so far we have less than two weeks between negotiating rounds. My question is about consultation. In 2015 congress is fairly specific about expectations for ongoing consultations with trade negotiations. How are you and your Team Handling the consultation expectation that congress has set and advancing at the speed youre advancing that . Were moving at warp speed but we dont know if working to get to a conclusion. Were running very quickly somewhere we have a series of fiveday sessions as you say, seven between the beginning and end of the year. The objective is for a variety of reasons theres elections coming up in mexico so the whole process is having reallife of facts on farmers and ranchers and Business People were trying to do things in the United States. But also in canada. Theres reasons to move quickly on a renegotiation if thats what youre going to do. The consultation processes complicated as most people know. The first time this process was route used was in 1979 when the Carter Administration and ambassador came up and did that agreement. Since every time we renewed it its fair to say that its emotionally true if not precisely that theyve added some twister something and people are somewhat on to do this or that. The reason is that the constitution gives birth brought over trade. So they have a right to say what the terms are. We have to consult with the congress in our advisors. We come up with tax, we have to clear first with the interagency process or give them an opportunity to be heard that we need to go to congress. When we get the proposals from other countries we have to do the same process. So its difficult but also hard on the advisory groups but the alternative is that you would stretch this out for some years and have a real negative affect, unintended Collateral Damage on real people since difficult. It takes time and is fairly intense its hard on everyone but has to be done. I think were doing a good job. One bilateral negotiation is the transatlantic partnership. And never youve really got much path what are your thoughts on the trade with that . Its a huge relationship, that agreement is one were looking at, has been a reason to look forward and theres been a series of elections in europe which should make it hard to do much with it. On the broader question the relationship is really important, theres an enormous amount of trade between the United States and europe. Working with europe on a variety of other things including the challenge with china but also negotiation with the wto is also important and i think we have good relations there. We need to try to develop in them. I know other people have done the same thing. Whether we start that agreement up its something were looking at right now. In the meantime were coordinating closely with them. One question on services. We talk about the Service Agreement but its a major share of the u. S. Economy and source of advantage for the United States and the world, whats your vision for where Services Negotiation can go in this administration and how should we see that play out . The objective of course is open markets until our people to compete and we see barriers to trade in countries that want to create their own National Champions in space. So when we think about services the biggest part of it is tourism. It really is it when people think as services and thats an extremely important aspect of u. S. Trade, not just because it generates income and wealth and jobs, but also because we need these it in companies and they really are the source of investment in the economy throughout the world. So if all of those companies are chinese and youre going to get one side of the investment you can see a different way that capitalists go around the world. Our hope is that if our model is followed is going to be more efficiently distributed and will be based on economics. We understand the importance of services and we understand that whenever we have a list of complaints with very specific barriers we have a certain amount of leverage and not anothers. We are doing what we can to open the markets for services. Right now its on a bilateral basis across the board. May be the first to thank you for coming here today and having a candid, forthright clear vision of what youre doing them i find your remarks helpful and i hope we been efficient with your time. Thank you. We wish you the best of luck. Thank you. [applause] [inaudible] [inaudible] [inaudible] [inaudible] [inaudible] [inaudible]
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