Raising Hopes for US Business

When Hillary Clinton calls, you drop whatever you are doing and come running. That is what private sector executives and leaders from US business organizations in over 100 countries did for a two-day conference hosted by the State Department in Washington, DC on February 21-22. 

The Global Business Conference was attended by high level officials from the US government including Secretary Clinton, Secretary of Commerce John Bryson and Vice President Joe Biden. In addition to top US business executives, nearly all of the world’s 115 American Chambers of Commerce (AmChams), including AmCham Chile, were represented by their presidents or executive directors.

The purpose of the meeting was to determine how the State Department can help promote US businesses abroad, increase US exports, attract new investment to the United States, and create American jobs. This is part of Secretary Clinton’s broader initiative launched last year to strengthen the relationship between diplomacy and economics – or “economic statecraft” as she puts it.

“For the first time ever, the US government called together the private sector to ask: how can we help you better?” said Javier Irarrázaval, AmCham Chile’s president and managing director of Latin America for the Walt Disney Company, who attended the conference.

The first day included remarks by Thomas Donohue, president of the US Chamber of Commerce, followed by plenary sessions on best practices for collaboration and what the government can do for business. The second day consisted of regional breakout sessions hosted, in the case of the Western Hemisphere, by Acting Assistant Secretary Roberta Jacobson.

Two issues emerged from these sessions as key concerns in the region: visa programs and intellectual property protection.

Everyone knows getting a visa to visit the United States since 9/11 can be a headache. The US government has made some recent improvements in the application process, making it cheaper, faster and friendlier, but there is room to improve as Irarrázaval knows from personal experience.

In March he took his family to Miami for a cruise but admits he could not complete the visa application process online without help. “I just couldn’t do it, it’s a nightmare.”

Chile’s visa application rejection rate needs to be reduced from 5% to less than 3% in order to enter the US visa waiver program, but in the meantime the US government could help by making the application process more user-friendly, said Irarrázaval.

The problem is that the hassle involved in getting a visa is affecting business. For example, many businesspeople now prefer to avoid stopovers in the United States en route to Europe, Asia or other destinations.

“This also affects tourism from Chile to the U.S. and vice versa due to the reciprocity charge,” noted Irarrázaval. Santiago’s international airport now accepts credit card payment for the US$140 per person entry fee (it used to be cash only) but the cost, especially for large families, can be prohibitively expensive. 

Another issue raised at the meeting was intellectual property: “there were loud voices from the pharmaceutical and entertainment businesses,” said Irarrázaval.

The problem is that Chile is very late implementing some aspects of the Free Trade Agreement (signed in 2003) related to intellectual property. It has made moves to close these gaps, for example with a new bill currently before Congress to strengthen the protection of pharmaceutical patents, but more could be done to crack down on piracy.

“The US position is that Chile has fallen way behind its commitments… today the United States will not sign new trade agreements with countries like Colombia, Panama or South Korea unless they have already implemented its requirements,” said Irarrázaval.

The risk is that the US government may take “serious action” against Chile if it does not comply with the terms of the agreement, he warned.

“I would expect the US government to act more aggressively around the world, including in Chile,” he said.

In addition to protecting the rights of US companies overseas, the conference also focused on how business associations can work more closely with the State Department to increase the competitiveness of US exporters.

Following the meeting, the Association of American Chambers of Commerce in Latin America (AACCLA), representing the 23 AmChams in the region, sent a letter to Secretary Clinton listing its recommendations. These include closer collaboration between AmChams and US consulates to facilitate business travel to the United States.

“We believe that the US relationship with the Americas, where the United States commands a vital share of total trade and where nearly half of all US exports are currently destined, is a special and unique case, and that our region can and should be the test case that illustrates the potency of your economic statecraft vision,” said the letter.

While Irarrázaval said the conference was a positive first step, he emphasized that AmCham officials and executives will be reluctant to spend the time and money involved in attending a follow-up conference unless they see concrete steps have been taken.

“If you open the door for companies and raise expectations, you have to do something,” he said. And, with US elections fast approaching in November, Secretary Clinton has limited time to show that she got the message.