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Remarks at the Association of American Chambers of Commerce in Latin America Annual Conference
Submitted on October 5, 2009 - 4:07pm
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Secretary of Commerce Gary Locke
It's wonderful to be here today, and I greatly appreciate Mickey Peters and Myron Brilliant inviting me to speak at AACCLA's 42nd annual conference.
When AACCLA was born in 1967, it was a time of historic change in South America. That year marked the death of Che Guevara, the publication of the iconic novel 100 Years of Solitude, and the crosscurrents of various political movements gripping the continent.
Although the ensuing decades continued to be tumultuous, AACCLA would stick closely to its core mission: Improving lives in this hemisphere by promoting expanded trade and investment between the United States and the countries of the region.
And that great work continues today.
This moment provides a chance for a new beginning for the Americas.
As President Obama said in April in Trinidad and Tobago, "all of us must now renew the common stake that we have in one another," and work to build a hemispheric relationship based on "mutual respect, common interests and shared values."
After a wrenching year that almost saw the collapse of the global financial system, we are seeing tentative signs of global recovery, thanks in large part to governments moving aggressively to stimulate domestic demand and free up credit markets.
In August, for the first time in 18 months, the U.S. manufacturing sector expanded, and the statistics used to measure manufacturing output were the highest they have been in over two years.
Positive trends like these are starting to sprout up around the world—and I was able to see these signs of hope up close when I was in Chile last week for The Americas Competitiveness Forum.
As many of you know, in challenging economic times like these, some inevitably succumb to the allure of turning inward and closing off markets.
We've seen this movie before and it doesn't have a good ending. Protectionist measure—however well intended—inevitably lead to trade wars and a lower standard of living for everyone.
But at ACF, I was pleased to see that most people seem to have taken that history to heart.
I'm confident that leaders in this hemisphere understand that the path back to growth can be found by investing in innovation and freeing our entrepreneurs to create and cooperate across borders.
And at the Department of Commerce, we'll be working hard to forward those goals. A few months ago, I announced five key strategies I'd be pursuing during my tenure to expand and open America's economic engagement with the world. They included:
1. Enhancing our trade promotion efforts by putting more resources into a commercial service corps that has staff stationed all over the world to help open new markets for our companies.
2. Streamlining our business visa system to make it easier for foreign company executives to travel to the United States.
3. Strengthening international intellectual property protections to safeguard American innovators from counterfeiters and pirates who cost our companies as much as $250 billion every year.
4. Mobilizing the entire federal government to encourage export promotion.
5. Reforming a Cold War era export control system that needs to be overhauled to meet new national security threats and improve America's global economic competitiveness.
On the ashes of this economic crisis, we have an opportunity to pursue new avenues of cooperation, new areas of economic growth in sectors like clean energy and a new global economic framework to spur sustainable, long-term prosperity.
At ACF, I saw how U.S. companies were not only helping to empower Latin America's entrepreneurs of the future, but how they were collaborating with local companies and investing in communities to make the people of the region healthier and better educated.
In Chile, I met some of the 800 budding entrepreneurs who were being trained at Cisco's Entrepreneur Institute.
There were people from every walk of life at this institute from virtually every age group. There was a woman who was making scarves out of her home, a man who was getting his hairdressing business off the ground. They couldn't be more different, but they were united by one thing: A desire to make their lives better—and Cisco was helping to make it possible.
Then I learned about how the Ronald McDonald Foundation had helped fund housing and support networks for young patients and their families.
Projects like this are a win-win for everyone involved. It gives McDonald's employees a renewed sense of purpose in their work and provides an example of how American companies can make a tangible difference in people's lives.
These are both textbook examples of corporate social responsibility done right.
We, of course, welcome generous philanthropy from American companies. But corporate responsibility is about more than just writing a check.
To me, corporate social responsibility means changing the definition of what it means to be a successful business.
It means being more sustainable in everything you do, from how you use resources like water, land and energy, to how you treat your employees to how you nourish the local communities where you are doing business.
This isn't just the right thing to do. It's the smart thing to do. It's good for the company's bottom line, and it contributes to social prosperity.
Take energy and the environment for example. For a good hundred years or so, businesses enjoyed the fastest growth we have ever seen in the history of humankind.
You can point to countless innovations that helped build today's modern 21st century economy from the automobile, radio, telephones, cell phones and TV to the advent of space exploration and the Internet.
But through all that change, there were two constants that underpinned the world's growth.
Fossil fuels were cheap; and the externalities of using them, like carbon emissions, were of almost no concern.
Those days are over.
Fuel is no longer cheap.
And the costs associated with fossil fuel energy are ferociously high.
If we don't curb the carbon, the consequences for our environment and our economy will be devastating.
Now, companies can certainly keep using energy like they did in the 20th century and they'll enjoy a few more quarters or a few more years of uninterrupted growth.
But when the seas start rising, floods start increasing and droughts start spreading and lasting longer, you'd better believe that's going to be bad for business.
Or, companies can adapt to the new realities of the 21st century: Start being more efficient and using cleaner fuels.
Companies won't just be leaving a better world for our kids, they'll be helping to save the only place where you can do business: Earth.
That's an example where the right thing and the smart thing are one and the same.
The same is true when companies partner with communities to contribute to local educational and health care programs or to help build up local infrastructure.
Every school you help build, every child you keep healthy is increasing the odds that someone will grow to reach their full potential.
And when you've got an educated, healthy populace, you've got a population that is going to use your products and services—but more important, they will build and create things, start new businesses and create a more robust local economy that will help everybody thrive.
Increasingly, we're seeing evidence that good corporate responsibility programs have a real impact on companies' bottom lines.
By enhancing brand image, reducing the cost of capital and building loyalty among customers, employees, partners and suppliers—these programs can generate direct financial returns of as much as 3 to 1.
And I've seen surveys where investors estimated that these programs can generate as much as 11 percent or more of total shareholder value.
I'm looking forward to deepening Commerce's cooperation with AACCLA on expanding corporate responsibility efforts by U.S. companies in the hemisphere, as well as various other efforts to strengthen our trade.
In partnership with AACCLA, Commerce has already helped counter anti-U.S. and anti-globalization messages with an outreach campaign to build awareness of the positive economic impact of U.S. business activities and investments in the region.
Together, we have built private sector driven programs designed to reduce the trade distorting effects of corruption on U.S. businesses.
ITA's Good Governance Program (GGP) is active in seven program countries (Paraguay, Nicaragua, El Salvador, Guatemala, Honduras, Panama and Colombia) and is working to expand its reach in other Latin American countries.
And we have convened a series of capacity-building customs workshops and seminars to spur the freer flow of U.S. goods throughout the regions.
Customs problems rank high among the barriers noted by U.S. companies doing business in the Americas. The AmChams' assistance in organizing these seminars was invaluable.
Over the next year, we will be building on these activities with a very ambitious agenda.
Last week, at the ACF conference, we announced that ACF IV will be held in Atlanta.
Early next year, I will be traveling down south again for the U.S.-Brazil CEO Forum.
This is an important public-private partnership that brings together American and Brazilian business leaders to identify ways to strengthen economic ties between the two countries.
The Forum's private-sector committee, which consists of 10 Brazilian and 10 U.S. CEOs, has developed joint recommendations for both governments to consider for increasing bilateral commercial ties, improving the business climate and eliminating impediments to trade and investment.
And I'd be remiss and I didn't mention two key programs that will undoubtedly feature heavy participation from AACCLA members in the upcoming months.
In May 2009, we partnered with the Los Angeles Area Chamber of Commerce, Mayor Villaraigosaand UCLA to launch the Americas Business Forum—which provided a lot of actionable ideas to promote economic recovery and jobs creation.
The second edition is planned for February 2010, and I hope I can count on AACCLA members being involved.
We are also in the process of organizing Trade Winds Brazil in April 2010, which will bring approximately 60 U.S. companies and 100 business leaders to São Paulo to learn about export opportunities, channels of distribution and best business practices.
That will be followed by one and one-half days of "speed dating" with ITA's Commercial Diplomats throughout the region to help companies find new customers and begin the export process.
It's going to be a busy year. An important year. After years of economic growth fueled by speculation and short-term thinking, its time for America to get back to what it does best: Building and exporting products around the world that help people live healthier, wealthier and more productive lives.
Latin America will be a key ally in this effort to restore economic growth. And I'm excited to have AACCLA as a crucial Commerce partner in working with our friends in the hemisphere.