The Hill News

As the U.S. continues its steady, but so far jobless, economic recovery, U.S. policy makers have rightfully set their sights on increasing exports to create American jobs and generate sustained economic growth. 

The American business community supports this effort and an increasing number of U.S. companies have targeted China as an important export destination for their products and services. And for good reason - China is the fastest growing market for U.S. exports and is arguably the most important destination for future export growth.

As a consumer market, China’s opportunities to increase exports have just started to expand. In the first half of 2010 alone, domestic consumption pushed up China’s imports by 50 percent.

On Capitol Hill, China is receiving increased attention of a different kind. Support is building for legislation meant to force China to revalue its currency in the hopes that it will protect jobs in the U.S.

It’s election season in Washington and voting for a bill to "get tough on China" is a mouthwatering political opportunity for congressmen fighting for their political lives.

But American businesses aren’t focused on short term political calculus; our goal is increased U.S. exports and sustained economic growth at home. What is the best way for Congress to create American jobs? Support the president’s National Export Initiative (NEI), which is a great first step to boosting U.S. exports and creating new jobs, and to take targeted, specific action focused on increasing the competitiveness of American companies exporting to China.

America’s biggest competitors enjoy a commitment to trade promotion at the highest level of their government and have been focused on the China market for years. To compete more effectively, American companies need the U.S. government to aggressively promote US exports. The NEI is a good first step but we can’t stop there.

The U.S. ranks behind Germany, South Korea and Japan in exports to China. These countries not only export tens of billions of dollars more to China by volume, they are managing to maintain more market share than the U.S. in an increasingly crowded China market. China’s potential is so great for U.S. exporters that capturing one additional percentage point of China’s import market translates to $11.3 billion in additional exports and over 75,000 American jobs.

When it comes to export promotion, "Germany is the model," says General Electric Chief Executive Jeffrey Immelt. Germany, which has an economy less than one fourth as large as the U.S., exported two-thirds as much as the U.S. to China in 2009.

Trade missions are considered an "official instrument" of German Trade Policy. Chancellor Angela Merkel oversaw approximately US $5 billion in new trade deals that benefit German companies on a trade mission she led to China in July, her fourth in the past five years.

Similarly, French President Nicolas Sarkozy led a trade delegation to China in November 2007 to promote economic links, the result: a grand total of US $30 billion worth of deals were signed.

A trade mission to China led by President Obama would dramatically raise the profile of U.S. goods overseas and help US companies win new Chinese customers. Presidential leadership brings instant credibility in a country like China, where government plays a major role in the economy.

German Centres, placed all over the world, target German companies trying to break into foreign markets. The German Centre in Shanghai is the largest in the world supporting more than 90 German companies with low cost, flexible office space, integrated business centers and qualified support services.

With funding from the EU, the European Chamber of Commerce offers its members comprehensive support including a bilateral project on the protection of Intellectual Property Rights and a EU-China Managers Exchange and Training Program.

To support its smaller businesses, Japan’s trade promotion agency, JETRO operates Japanese pavilions at the annual China International Industry Fair that provide Japanese companies an opportunity to close deals with Chinese companies. In 2009 alone, JETRO reached an audience of some 7,000 Chinese trade companies that brought participating Japanese companies more than two hundred prospective deals.

 

To enhance US export competitiveness in China, the U.S. needs to ramp up its efforts to match funding and resources committed by China’s non-US trading partners. The models are already out there. Fully funding the NEI and placing additional focus on the China market will help American companies compete in the world’s fastest growing market and provide new job opportunities for millions of Americans.

Roche is chairman of the Board of Governors for the American Chamber of Commerce in Shanghai.