*City National Bank's Trade Negotiations and the Future of Your Cross-Border Business panel discussion took place on May 24, 2018.
International trade is a part of our everyday lives. The U.S. has a trade deficit that exceeds $780 billion. Even accounting for the fact that the U.S. has a trade surplus in services of close to $250 billion, our net trade deficit is still an eye-opening $530 billion.
Yet the numbers don't tell the whole story. For the most part many countries – including the United States – have seen healthy increases in productivity and per capita income during the past couple of decades. Innovations in technology, the development of highly efficient supply chains and access to higher levels of education are some of the key factors that have played an important role in building wealth globally.
However, our current trade agreements did not take these innovations and evolutions into consideration when they were struck years ago. Today, we are much more aware of the importance of the protection of intellectual property rights, as well as social, workforce and environmental issues – to name a few – than we were when many of our trade agreements were first signed. This is why many experts in international trade policy agree that the rules surrounding our trade agreements need to be revised.
Of course, the rules still need to be fair and the leaders of international trade must be reliable, transparent and accountable.
Historically, trade negotiations have taken place without much media attention and very little drama. Indeed, most Americans barely knew they were taking place.
This has not been the case during the past 18 months. This Administration and its trade policies have been front and center, with intense scrutiny on its tactics and unprecedented approach of negotiating with all of our key trading partners simultaneously.
Questions have been raised about the Administration's ability to focus on important issues and make sound, long-term decisions. But what's really important is whether we are losing the confidence and trust of critical foreign trading partners and how that will affect our ability to remain the wealthiest and most productive nation on earth.
That is what our panelists discussed at our "Trade Negotiations and the Future of Your Cross-Border Business" event. They provided ideas, guidance and views on the important issues to consider going forward, as well as some practical insights that might help guide your business planning.
Watch the video to get each panelist's unique perspective on these topics.
- All four panelists agreed that while the current approach to negotiating revisions to our most important trade agreements (such as NAFTA) is unprecedented, it has created uncertainty, making it difficult for businesses to do long-term planning for their international activities. Yet they also agreed that “we will get through this" and the final results will be in the best interests of American businesses.
- All four were also in agreement that the primary reason for their optimism is that the global supply chain and global markets are already highly integrated and dependent upon each other economically. It is in no country's best interest to dismantle the engine that has built wealth and prosperity around the world.
- Among the most important activities any U.S. business should be doing now in regards to their international plans and strategies is to understand and evaluate every component of their supply chain. Companies should look at alternative sourcing and selling markets and channels and assess the current costs of their supply chains. They should understand what the financial impact of an increase in tariffs would mean - not only for their business but also for their suppliers' businesses.
- The importance of NAFTA goes beyond assuring beneficial trade rules for the U.S., Canada and Mexico working together. It is also a critical tool to strengthen our collective economies, which becomes especially important when we are competing with China and other Asian countries and must maintain our competitiveness in global markets.
Moderator: Steve Bash, manager of International Banking and Trade Finance, City National Bank; Member, U.S. Department of Commerce Trade Finance Advisory Council
Mickey Kantor, partner at Mayer Brown and former U.S. Secretary of Commerce
Lyric Hughes, editor-in-chief of EconVue
Michael Camunez, president and CEO of Monarch Global Strategies and former assistant secretary of commerce at the International Trade Administration
Craig Wright, chief economist of the Royal Bank of Canada
|This event is for general information and education only. The views and opinions expressed and projections given are those of the presenters as of the date of this event and do not necessarily reflect the official policy or position of City National Bank. This event is not a recommendation or an offer or solicitation to buy or sell any financial instrument discussed. It is not specific investment advice. Financial instruments discussed may not be suitable for the event attendee. Event attendees must make independent investment decisions based on their own investment objectives and financial situations. Prices and financial instruments that may be discussed are subject to change without notice. Instruments denominated in a foreign currency are subject to exchange rate and other risks.|