Under Secretary of Commerce For International Trade Francisco SÁnchez
Russia-USA Business Roundtable
St. Petersburg International Economic Forum
Thursday, June 20, 2013
St. Petersburg, Russia
As prepared for delivery
I am honored and pleased to represent the United States here at the St. Petersburg International Economic Forum.
President Obama’s administration has made the pursuit of shared economic interests one of the priorities of our government’s work with Russia.
To that end, we have seen real results during the past few years.
U.S. exports to Russia rose 29 percent, to $10.7 billion, in 2012.
Trade in goods between Russia and the United States stood at just under $40 billion in 2012.
However, there is room for more growth in both directions.
Today, for example, Russia is the 6th-largest economy in the world, but only the United States’ 20th largest trading partner.
That gap can be closed, and we can both sell and build more in one another’s markets.
So, we look forward to continuing to work with our Russian colleagues to realize the full potential of this relationship.
One important vehicle for progress was the establishment in 2009 of the Bilateral Presidential Commission.
The relationships that have grown out of it have helped pave the way for a variety of successes in our economic relationship.
Of course, the most noteworthy of these successes in the economic realm was Russia’s entry into the World Trade Organization in 2012.
Although this required lots of effort on the part of Russia and all its trading partners, we are pleased that President Obama took a strong role in working with Russia in a concerted push to help this happen.
This is good for the WTO, good for both the United States and Russia, and good for the world economy.
Russia’s WTO entry in August 2012, granting of Permanent Normal Trade Relations, and the implementation of a new bilateral visa agreement in September were three specific and meaningful developments of the past year that promise to facilitate trade and investment between our two countries for years to come.
We share a desire to build growth and prosperity for our companies, our workers, and our customers.
One of the vehicles to achieve our goals is a working group formed by the Bilateral Presidential Commission dedicated to business development and economic relations that is co-chaired by the Secretary of Commerce and Minister of Economic Development Belousov.
This past March, we adopted a two-year work plan under which the United States envisions enhancing economic cooperation with Russia along four main lines, including: maximizing new opportunities presented by Russia's accession into the WTO, increasing two-way direct investment as well as trade, facilitating bilateral trade and investment in sectors and regions with high growth potential, and intensifying U.S. and Russian government consultation with the private sector.
In each of these areas, we are actively working with our counterparts in the Russian government to identify specific areas of cooperation that can produce mutually beneficial results such as: increase transparency in standards and government procurement practices, expanded trade, investment and innovation in high-potential sectors such as healthcare technologies, motor vehicles and other industries, and stepped-up attention to business opportunities in some of Russia's regions.
Russian leaders, including President Putin, have articulated ambitious goals regarding increasing transparency, streamlining regulations, combating corruption, encouraging foreign investment, and investing in infrastructure.
We firmly believe that through close collaboration, American companies can demonstrate the value of progress on such issues, and can show that building Russia’s domestic economic base and integrating into the global economy do not have to be mutually exclusive.
We are working to support this integration.
For example, last month as part of our bilateral work plan, after several months of preparation, we organized a “U.S.-Russia Standards and Conformity Assessment Forum” in Moscow on May 30.
The Forum attracted more than 300 participants and jump-started a number of what we think will prove to be very important discussions on how the U.S. and Russia can increase transparency and interoperability in the realm of product standards and testing.
The ultimate goal is to make it easier for our companies and our products to work across one another’s borders.
Incorporating international standards into Russia’s own standards practices can help Russia meet its WTO obligations in the area of technical barriers to trade.
Not only making it easier for foreign companies to sell into the market, but also at the same time making it easier for Russian companies to integrate into global supply chains – a true “win-win” proposition.
Our team is looking forward to working closely with the U.S. and Russian public and private sectors to develop additional initiatives that will help Russia meet its economic goals as well as support trade and investment opportunities for U.S. and Russian companies.
Another aspect of our work that I would like to highlight is our effort to increase two-way investment, including encouraging Russian investors to seek opportunities in the United States.
First, I should say that historically the United States has welcomed foreign direct investment.
We have, in fact, succeeded in attracting a critical mass of direct investment at various crucial times in our nation’s history.
During the industrial revolution, we built railroads, shipyards, and factories – and all with a critical mass of foreign direct investment.
Today, this investment continues and I’m here to encourage more of it.
We appreciate that business investment—whether by domestic or foreign firms—leads to economic growth and has a beneficial impact on U.S. jobs and exports.
So let me be absolutely clear: the United States is open for business.
We want Russian companies to know that we welcome your investments, your know-how, your ingenuity, your capital, and your technologies.
We look forward to continuing to work with current and potential investors to develop projects.
Some of them are represented here today on this panel.
The total stock of Russian foreign direct investment in the United States now equals almost $8 billion.
This is more than existed a decade ago, but it is a figure that has significant room for growth.
We also want more American companies to come here to Russia.
A year ago, in June 2012, I brought a delegation of American companies in the energy-efficiency industry.
We think that this is a great example of an area where American and Russian technologies and markets have great potential synergies, as Russia and the United States work to boost our energy-efficiency across all sectors of our industries and economies.
Healthcare technologies are another area where Russian and American know-how can work together.
I’m happy to say that our working group will be encouraging a healthcare technologies trade mission that the Department of Commerce will bring to Russia in October.
The working group will also implement a regional initiative.
The goal is to work to increase the scale of U.S. investment in Russia’s high-growth regions that have also demonstrated significant efforts to improve their business climate.
Under this effort, we will work to promote opportunities in these regions as well as launch initiatives to cooperate on improving transparency in procurement practices.
These are just a few examples of areas in which we see promise, but there are many others.
I know that our purpose in this dialogue is to hear from businesses on both sides, so I want to assure you that we are open to your ideas and advice.
I look forward to today’s dialogue and am interested in your thoughts for how we can work together more effectively.
Thank you very much.
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