government shutdown right now? >> guest: 90%, this is going to run out.. so remember, the government is closed for christmas eveas and christmas day so we won't really do it until the middle of next week. >> host: niels lesniewski, thanks very much for being with us. >> guest: thank you. >> the u.s. senate coming in at noon eastern to debate the house approved spending bill which includes over $5 billion in funds for the building of the wall at the u.s.-mexico border. right now trade ministers from the australian, new zealand and japanese embassies talked about u.s.-china trade relations. this event is hosted by the global business dialogue.

>> okay. i will count to three or four and then we will be underway to be about as close as longtime s we've ever done. so good morning. good day. thank you all for coming. i'm with the global business dialogue and it's a real pleasure to welcome each of you here today. we'll get to the heart of this morning's program in a minute, but just a few thoughts first. it's january of course that is named after the two face god, looks both ways, , fortson bath court. really though, that's a better description of december than it is of january. by december 31 you are seeing auld lang syne and worrying about next year but when january second comes around, it's just

fully hardcharging towards making the first quarter of 2019 as good as it could possibly be. that will be especially true in trade this year when we have a a march deadline for the use china talks, the current ones, and, of course, we have the looming brexit deadline in the 29th of march. it's december which we get to pause for a moment and look both ways. hanukkah has just passed, it is known as the season of lights,, festival of lights but judging all the business tree light of an arlington, i would say that the whole business of lights is entered interdenominational and so was reflection. in my short time at the microphone i'd like to reflect on three things with you. first is the global business dialogue. second is the pharmacy and the third is friends. gdp has been a growing concern for 19 years now, which is not

tickle impressive but it is amazing to me it was found in the plea that trade policy is important, and we're talking about. put . put differently, if economic activity is the clay of trade policy, then conversation is the potters wheel on which it is shaped. and for us nothing symbolizes conversation more than a hot drink and given a special history in trade, t is particularly apt and so that's why our local is a teapot with a globe. but you can't do things like this without a lot of help. we can't thank everyone today but two of our sponsor members are represented here and i like to mention them. one is steph johnson and dick cunningham. another trade data monitor. nobody is trade data like tdm. don brash of the founder of the company couldn't be with us but he's represented by a young

associate. but, of course, every member helps, every member contributes, and we're grateful to all of them, to all of you. now about diplomacy. all of our speakers this morning our diplomats. tammy and andy may not have title like elisabeth bowes, philip houlding, they are diplomats. whenever you think of the about alan gottlieb who is canada's ambassador to the united states back in the 1980s when the canada/u.s. free treatment was being negotiated before he left he gave a mother star will speech i think you're at the press club. in it he was saying that old diplomacy, the kind where countries made their views known to note of the state department was over. but today diplomats particularly in washington had to be engaged with anyone. that engagement is not easy.

it takes a dash of courage and a lot of work and i'm very grateful to each of this mornings speakers for making the effort. now, trade policy has its invisible land component. each representation of a countries abuse enriches the global comments of understanding. i i do want to be flip but i did see building an audience. when bill was with cat in the '80s he was an advocate for the canada/u.s. free trade agreement. once he was giving a talk to farmers in pennsylvania, and he referenced the famous playing field and he said, the point he said as not to level the playing field. it's to fertilize it. but that's bill lane. finally on the subject of

friends, gbd relies heavily on sponsorships and memberships and it also relies on friends and friendships. these last few years joanne, our vice president, and her husband dick, have been incredibly helpful and very good friend of gbd. and for over a decade gbd was within the richest soil at samuels international were andy durrant, another good friend, was and is the managing director. and he knows asian well, very well. and it is my good fortune in your study will be your guide the rest of this morning's program. andy, you're up. >> thank you very much. >> eyes going to suggest you keep your initial presentation here and do the rest. okay. >> thank thank you, judge, and d morning to everyone, to the last gbd program of the year. i'm just here to moderate, , so let me get on with moderation.

the first speaker is elisabeth bowes who has been here with the minister counselor with castilian embassy since july of 2016. we were chatting just a few minutes ago and she had thought when she came in at her focus was going to be tpp implementation. it's a little different but it has been interesting, so with that, elisabeth. >> thank you very much, andy, and thank you very much, judge, as well for those welcoming words. judge was one of the first people i met in d.c. when i arrived two and half years ago, and we've had a good relationship and friendship ever since. i'm quite delighted to be asked to speak at today and also to see so many good friends and colleagues here in the audience. i think i'm up first because australia has relatively unique perspective on trade relations with the two economic giants,

the u.s. and china. as so many many countries and indo-pacific region, china is by far our largest trading partner. but overall the u.s. is our largest economic partner. and both of our relationships are underpinned by free trade agreements which is also something of a rarity. given with both those countries. i thought i would give a quick overview a comparative overview of our respective trade and investment relationships with each of these giants starting with the united states. two-way trade in goods and services is currently valued at about $68 billion. of that, the u.s. enjoys a trade surplus of approximately $29 billion according to according to the beer of economic analysis. analysis. australia's major exports to u.s. is primarily agricultural commodities were as our imports

from u.s. are industrialized products. the bilateral investment relationship is quite significant and is valued at over $1 trillion. china china as i said is austras largest trading partner and accounts for nearly 30% of australia's exports. in fact, our bilateral two-way trade reached a record almost 200 billion australian dollars in our last fiscal year 2017-2018. that's about $140 billion u.s. that is more than double the two-way trading relationship that we enjoy with the united states. of this amount, australia's exports to china accounted for approximately 123 million australian dollars in goods and services. that's about 86 billion u.s. that means australia has a surplus with china of about 50 billion australian dollars,

or 35 billion u.s. dollars. our trade with china is a dominican commodities, primarily resource and agriculture, iron and coal feature heavily. mobiles of expanding services exports, particularly and education services and tourism. by contrast with the united states, two-way investment is much more limited between china and australia. although it has grown from a fairly negligible base in the last ten years, bilateral investment is valued at about $70 billion as i said, with the u.s. it is 1 trillion. australia as a trading nation and we are proud of it. australia along with the u.s. was a founding member of the general agreement on tariffs and trade, and its successful organization the wto. our location and indo-pacific

provides particular focus for economic trade and investment relations. the indo-pacific region is home of eight of our top ten trading partners, and when negotiated with seven of those partners. not only get australia and the you assure strong security ties, some would argue the closest of security ties, , we've also shad the pursuit of open markets in support of peace and economic growth around the world. we submitted our bilateral trade ties with the united states in 2005 with entry into force of industrial u.s. free trade agreement. under that agreement all u.s. goods, vice president pence on a visit last you described as a model fta. the china australia 88 is much younger. it's currently approaching its third anniversary heading into

force december 2013 after some ten years of negotiation. beyond tariff outcomes, negotiated services market access outcomes have secured his commandments that free us chugging compass from arbitrator into commercial partnerships with chinese businesses in certain sectors. these agreements have been beneficial for all three countries, australia, the united states, and china. both sets of agreements has spurred bilateral growth and investment. beyond this, , however, these agreements have provided stability and predictability in our trading relationships as well as with the tools for dialogue and increasing liberalization. some forecasts suggest by 2030 asia will be become of about 3.5 billion people in the middle class. australia's economy will complement those of a growing asia. demand for minerals and energies

will continue and will be significant opportunities to supply regional economies with services and premium agricultural products. our bilateral trade agreement with china is just one of the agreements we have with our neighbors in north and south east asia that will support increased two-way trade and investment. in our region we are also looking at a very important milestone, december 30, the entry into the force of the tpp 11 which provide a sophisticated regional framework of rules for its members to facilitate trade and investment in the region. we are not standing still. we are currently negotiating the 16 country regional comprehensive economic partnership together with china, the pacific alliance countries. we are in negotiation with as well, and we recently concluded the gauche editions are on bilal agreements with indonesia and hong kong.

of course further we just launched negotiations with our biggest trading partner as a block, the eu. while these agreements form the cornerstone for our bilateral and regional economic relationships, they are underpinned by wto rules. in other words, the rules that are embodied in the wto provide the foundation for our trading relationships including with the biggest adjustment in the system, the u.s. and china. as a trading nation, and well functioning wto is a fundamental importance to australia's interest. wto rules that limit arbitrary and unfair trade restrictions provide stability and predictability for international trade. this supports economic growth, job creation and improvements in living standards. in this context we view china's succession to the wto as a positive, providing as it does a rules-based framework upon upon which we have built in our

bilateral fta trade relations. china's economic transformation partly due to its succession to the wto has lifted millions out of poverty, and this economic transformation has been one factor in australia's 28 years of uninterrupted economic growth. as much as we are increasingly rely on fta's to govern our trading relationships, the wto remains a fundamental importance as a form to deal with issues of an inherently multilateral nature, and in particular this includes subsidies and domestic support. turning to the current trade policy headlines of today, from australia's perspective we recognize long-standing u.s. concerns regarding china's ip related practices. we are encouraged the use the s chosen to address at least some of its concerns to the wto and its wto dispute settlement

mechanism. but we recognize that u.s. concerns extend beyond ip related practices. for australia, as a trading nation, dependent on multilateral trading roles, predictability and stability in trading relations, it is important u.s.-china relations do not become defiant and confrontational or adversarial terms. this risk strategic instability as well as damage to economic growth both domestically, globally, and particularly in the indo-pacific region in which australia is located. it also risks damage to the multi--- multilateral trading system. we therefore welcome the meeting between president she and trump at the g20 and the news a continued discussion between the. australia has consistently encouraged and negotiated a contract with the two countries

which opens markets, is nondiscriminatory, which steps back from tariff escalation which is consistent with wto rules. not only would that be good for the global trading system, it would also be good for the u.s. and china. as the smaller trade expose nation, i have highlighted the weight that australia places on the rules base global trading system including the wto. we have a systemic interest and all members abiding by wto rules and opponent and in their own trading relationships. we also want to see all wto members commit to ongoing liberalization to allow for participation in as many areas of our economies as possible. but as g20 members have recognize, the wto is in need of reform. improvement of wto processes such as transparency and notification procedures and the proper functioning of wto committees will also assist in

strengthening the framework for u.s.-china trade relations, which i note are not subject to any preferential trade agreement. and will also exist in strengthening this institution as a whole. and that is why australia is cosponsoring the u.s. transparency initiative in the wto, and we've already seen some positive areas with the submission of just a few days ago of china's domestic support notifications for the years 2011-2016. so in conclusion, we are very clear eyed about the challenges that lie ahead and that these challenges are significant. it will be a heavy lift from both countries. if the u.s. and china are to reach an agreement that sees tariffs not just paused but lowered on both sides. whatever its nature, an agreement or arrangement will have impacts for third countries

and the global trading system as a whole. now while we want to see that agreement, to fruition, we, australia come on that sitting idly on the sidelines. we will continue to progress her own trade liberalizing agenda to the elephants might be fighting but in some areas at least the grass continues to grow. thank you. [applause] >> that was terrific. so now please join me in welcoming shige watanabe, the minister counselor with the japanese embassy here, and will brief is somewhat japan has been doing over these past few years. >> thank you, andy. good morning. so i'd like to talk about the

inference of u.s.-china dispute and our policy, japan's policy on trade. this year and for the future, next year. so first of all, it is a fact that trade dispute between the united states and china, the largest and second-largest economy in the world, and the largest trading partners of japan affects the japanese economy and japanese companies, japanese people, workers. a poll in october, conducted by -- revealed the number of japanese companies affected by u.s.-china trade war has jumped

to almost a third up from just 3% in may. so significant jump. we are concerned about the prospects of export from china, and chinese demand is going to soar. so we believe that it is important for of course first united states in china communicate to each other to solve these problems. through dialogue. very important. so having said that japan itself has to protect our companies and workers from nonmarket oriented policies and practices from

third countries. so those practices include property theft, trade distorting industrial subsidies. and distortion created by state-owned enterprises, and over -- [inaudible] that is why we are watching closely with united states -- working close in bilateral framework and with united states and eu and a trilateral talks. in these frameworks would also promoting the discussions of wto reforms and e-commerce. you can see some elements of

those discussions in the joint statement issued between prime minister abi and president trump. and in joint sentiment of trilateral talks. both issued in september at the time of united nations general assembly in new york. so in addition to that, just before the meeting between president trump and xi jinping on december 1 at buenos aires, prime minister abe met with president trump and pointed out that it is important for china to take concrete measures to solve the problems of what i mentioned before.

and with regard to the tariffs, which is now the kind of focus between the china and the united states, japan is -- and believes that any kind of trade created measure has to be consistent with wto. so although it is necessary to scrutinize each measures, but generally speaking you are raising tariffs over wto boundaries which raised questions of consistency with the wto. so in that sense, i have to say, the current tariffs imposed,

200 billion or $250 billion worth of chinese goods. and again, we hope that have discussion between the u.s. and china will lead to a solution of trade solutions through dialogue. japan of course an attempt to communicate with both united states and china going forward. finally, i will briefly touch upon the code situation at japan's trade policy. i'm grateful and excited to see that tpp will take effect on the 30th of this month. and also the japan eu epa will

start on february 1 next year, if the eu commission makes a decision tomorrow in brussels. these agreements of course are part of japan's trade policy in 2018. with regard to negotiation for japan, united states agreement on goods as well as on other key areas, including services, that can produce achievement, i have to be very accurate on this. technically speaking, we can send those negotiations 30 days after ustr submit details of this to congress. and i believe that the ustr is

working on that right now, and so there's also required by keeping a process. so meanwhile, we welcome the substantial progress made in our negotiation in 2018. and we determine to complete in 2019. thank you. >> thank you very much. [applause] >> thank you very much. so now i'm pleased that tami overby can join us. she's now with mclarty associates but spent 21 years based in seoul, and another eight years after that working as the head of the asian division of youth chamber. i think kami can help bring the

perspective of american companies -- tami -- and american private sector that will kind of match up with what we're hearing from our speakers representing their governments. >> well, thank you. i want to thank judge and joanne and the global business dialogue for inviting me. conversations like we're having today have never been more important. we have a saying in the trade world that if you're standing still, you're falling behind. and from my perspective, nowhere is that more evident than in asia. i want to offer huge congratulations to my friends from australia, japan and new zealand for their hard work, their leadership, and the success that they're about to enjoy 11 days from now on december 30 when the cp tpp, or

tpp 11 enters into force. and then a few days later vietnam will also join that very esteemed group. i don't think many americans realize what this means to us. american farmers and ranchers and employees are about to be significantly competitively disadvantaged in some pretty important markets, particularly japan. american wheat farmers are about to take significant hits since australian and canadian wheat farmers who are the biggest competitors in the japanese market are about to get preferential access over american wheat farmers. and i should note that america was a pretty big proponent of

these high standards, comprehensive rules that cptpp now has, and it is, in my view, terribly unfortunate that our companies and our farmers and our ranchers are not going to see the benefits. so the u.s. wheat and national association of wheat growers said after japan ratified tpp-11, that if nothing changes before the effective tariff schedule is fully implemented, u.s. wheat farmers and u.s. grain trade will essentially be writing a $550 million check every year to their australia and canadian competitors. some of the tariffs in cptpp go to zero immediately 11 days from

now, while others will be eliminated or reduced over a number of years. for example, japan is going to eliminate all tariffs. it's going to go to zero on 32% of their agriculture and act food related products immediately. 9% of the items will still have some tariffs but a preferential rate. the remaining 59% of their product tariffs we eliminated over 20 years. i should note that that is for the countries who are in the cptpp. those tariff eliminations and tariff cuts will not come to american farmers, ranchers, and employees. but the preferential tariff rates will go to those countries who showed courage and vision. in addition, on february 1 next year the eu, japan economic partnership agreement, their

fta, is likely to enter into force, assuming friends in brussels tomorrow vote as everyone expects. so american farmers, ranchers, and employees come again let me underscore, we are about to be significantly, competitively disadvantaged in the fastest-growing part of the world. does anybody doubt what i think about this issue? i want to make sure i am clear that americans are about to be significantly, competitively disadvantaged. also, other agreements happening in asia, my colleague mentioned the regional comprehensive economic partnership. this this is the ten asean nati, australian, new zealand, japan, korea, china and india. this is a huge economic collection of countries. they are moving forward. i actually, i admire your

optimism that it will be concluded next year but as somebody who helped draft some language year after year after year on tpp at how we're expecting significant conclusion this year and becoming very good friends with my thesaurus as with the new ways to say we're almost there, not quite but we're getting close or i i wish you the best of luck. but it actually, it is moving forward. whether concludes next year or not, come my view the important thing is they are moving. negotiating. they are trying to open new markets for their farmers, ranchers and employees. other countries, one of the countries in asia doing right now were not part of cptpp? korea, my old home, the koreans have free trade agreements with almost anyone in the comprehensive partnership for

tpp, with all of the 11 except mexico and more importantly japan. so korea is seriously looking at joining tpp. there are some political issues between countries in the group, so i don't know how quickly will happen, but i know they are watching it very closely. no one wants their country at a competitive disadvantage. you know, who would be the biggest beneficiaries of this new competitive agreement, tpp-11? frankly, i think countries like vietnam and malaysia, countries that are well positioned geographically. they have lower wage rates, improving infrastructure, and now high standard, comprehensive policies, rule of law.

companies will be able to have a high level of predictability in those markets. and most importantly they are liberalizing. they are opening their markets,, and they're doing it for their own competitive reasons. when the u.s. and korea first negotiated, many people asked me why is korea going to why does korea want to do this? korea had to make significant changes. they had to rewrite a lot of their loss. i had open things up. they had to -- bill lane, i'm going to steal your life. data for life that plaintiff. why did they do that? did it because you live in a tough neighborhood and they knew that for the future competitiveness they needed to open up, that liberalization was the best way. so countries like vietnam and malaysia are following that same path.

from my perspective, they are one of the coolest things about tpp is you have fully developed economies like japan, , like us chile, new zealand, and you have still developing economies like vietnam and malaysia. and yet they all agreed to the same high standard. now, it's true that those still developing economies will get some capacity building help. i get some extra phaseout, some transition times to help them get to that high standard. but it really is a race to the top. so a huge -- i accused respect for those governments who had the vision and the courage to do this. and to those governments that on day three of the new administration without any serious consideration decided to withdraw america from tpp, i think it will go down in history as one of the biggest economic

mistakes made in my lifetime. i'm going to stop right there because we want to get your questions. you guys are great audience and i am here all week. [laughing] [applause] >> thank you, tami. that was a little understated but hope we can maybe draw you out in the questions. .. >> i expect it will be one of his last he will be going back to capital next month, thank you very much. >> thank you, andrew, thank you

very much, judge, for inviting me to speak here. thank you for being here. i want to acknowledge other members of the panel, my embassy colleagues, sharing information in the last couple years and my washington colleagues, tammy, who is always an entertaining person to talk to not just today, but last time i spoke here was 2016, quite a different time but there are some similarities. i was a heavily australia oriented program. there was a really great speech that started the proceedings and given the local background, his sinew ready in the australian system that gave me

a lot of political cover, i couldn't say to know with that i use and i found myself agreeing with elizabeth in particular and associate my speech with a speech she made. the organizer associated me more strongly with australia and the signed there, it gives me exceptional amounts of cover. [applause] >> we should fold the people at home. nonetheless, by saying something like that you can picture me as an australian. the other similarity from 2016 that was interesting to me, thank you for mentioning, the valedictory nature of this, in our diplomatic system, i

haven't earned the right to do that but i was looking at the time i spend here in the iron he given how different the environment we are facing from 2016 when we were talking about ratifying tpp and all those things, it is the same. and this was about, and we were arguing, and where the economic future is, it is imperative to be in the room for those discussions. i was arguing the

the reality is the architecture the rules develop for a country like new zealand. 5 million people, one of the most -- one of the smallest economies in the region. a more concerning environments rather than dealing with every country bilaterally with accepted standards. people have talked about tpp which is coming into for some in a couple weeks time. if you go back to early 2017 just after the administration withdrew from tpp a lot of people said why bother doing tpp? what is the point? we have these rules and standards ingrained in the region and that is a huge benefit. there are massive commercial

gains in new zealand from the tariff and the market exodus but down the line the greater economic gain is removing barriers and having clear, consistent standards in the region. for new zealand, i don't want to reject the premise of this event but i want to say new zealand's approach, the reaction, if you like, is not just the us and china but a whole bunch of things we see coming down at us in the world and it is related to the common nature of the economy, massive distance from everywhere, very small scale. i enjoy comparing 500 employees, in new zealand, less than 10. we really don't have -- we have a couple, 2 or 3 or 4 that you

could pull major size businesses but the whole economy -- we have a series of things to talk about in a second that we are doing, not just because the us and china are having a scrap but because of the nature of our economy and things we see coming and obviously the us and china, we see trade restrictiveness across the world, we see increasing disruption to our economy as everybody has. we have seen a big growth in skepticism in new zealand as the economy, 60% of gdp is trade related in new zealand and we have to take on all those issues and that is what we are trying to do. i don't mean to resist the premises and reject is clearly. when the us and china like others here, china is the number one trading partner, the us is number 3, australia is number 2.

the top three economies, having china as the number one trading partner, you know, is going to be impact. obviously primary impacts in new zealand companies, you see them affected by tariffs, more importantly, you see the prospect of medium to long-term economic damage across the world at this disruption and i think there is an aspect that makes me nervous, when you see people in both countries celebrating the other facing economic hardship. you have to be careful what you wish for. you could argue what you are seeing in markets reflects a case of one country winning or losing, you will see damage across the world and as

elizabeth said, a lot of us our age, china is a major trading partner, each of us will be hurt if china's economy is hurt in these things rebounds, it is obvious. the final thing with respect to the us/china trade dispute that is concerning is, trying to figure out to myself how to relate the us and china to the wto and it is an argument with the us/china dispute whether the wto is in trouble because of us/china. another point is the wto, the concern where things are going to the us and china, i think every member of the wto has its concerns with the way the organization has evolved or

not. the rules we are operating under, not all of them but for the most part, since 1995, this is a big driver why you have things like tpp that attempt to deal with a new economy and happily a lot of those are shared by us mca which is good. to elisabeth bowes's point we see a problem with growing subsidies. that is always been a problem for new zealand and the only way to deal with those is in geneva so we generally think at some point we will need to come back and start to negotiate properly and i'm not calling for that now. a lot of things need to be done before that can happen but not just because we need new substance. but because the dispute settlement body, the sheer

holding the thing together with negotiation, because contrary to what people say the wto isn't going to march into any capital and make you change the rules. you only change rules because the benefits of being in the wto outweigh the costs and so we need to be negotiating, making clear the benefits to people, making progress. i've probably gone on too long. let me go on with the responses we need to things we are seeing in the world, we are fully engaged in geneva, working on things people are talking about. we continue with trade agreements, i was listening to the list elizabeth gave, the same negotiations happening for new zealand, negotiating with the eu, negotiating with the alliance and for new zealand

going for all those things, we have 53% of merchandising covered by trade agreements, we will see if we can finish those negotiations. we are involved in international organizations which we are hosting in 2021, building these international communities, we are engaging in engineering and elsewhere on inflexible and negotiating approaches. there are good things you can do in geneva even if you are not doing multilateral negotiations. i can think about important negotiations for subsidies, obviously the e-commerce and digital trade negotiation. we would like to see fossil fuel subsidies brought to the wto for environmental reasons. we have a really aggressive and assertive strategy to deal with

non-tariff barriers. we are slowly getting the system behind that and we launched in the last week a strategy to deal with technical barriers and on the agriculture side a really strong history of dealing with symmetry barriers, dealing with those. i will end on this because we come from different perspectives we face in the us and new zealand, we face some of the same issues in terms of getting a social license to track and in new zealand, the initial version of tpp past by one vote in parliament which were country like new zealand is surprising but this government came in and realized in order to get the social license, political license to be involved, they needed to make sure the benefits were found across the economy. there was a whole domestic process of consultation and refreshing the kind of

community involvement and that will be a big focus going forward on something that clearly needs to happen here one way or the other, so people don't feel alienated by the trade agreements. it is a big challenge. thank you. [applause] >> thank you very much. let me take the moderator's prerogative and ask the first question. really a question to all the panelists. very briefly, if we go all the way back to january 2017, seems a lot longer than less then two years ago, there was a feeling here at least that the tpp was kind of not going to be resurrected. and that we weren't really sure where the driving force for liberalization was going to come from. that was the theme for the first year and now, as we reach

to a series of actions the us has taken, notably the dispute with china, i think it is a mistake to look at the resurrection of the tpp as something just being done in response to the bilateral dispute between the us and china, but really that it is something that other governments have decided they will pick up the mantle and push for liberalization. if i could start with you and go along, i would love to hear your thoughts on that. >> to be frank it is a response to the us china trade tensions. it was really for the reason that tami overby articulated. asia is the most advanced and dynamic region in the world. i mentioned it will be home to 3.5 billion middle-class.

it is our region. as philip houlding pointed out, the wto had gone so far on rules, rules need to be updated, the tpp, we still saw inherent value and so that was the principal driver. we were trading nations. it helps to have the regional framework and systemic integration in that fastest most dynamic region in the world. >> thank you. tpp -- on these issues, and the issue came up between the us and china was not only the issue of the us and china.

what was involved, in that discussion. so very much. >> on the tpp we should point out even though the united states government were through, american companies that operate in those jurisdictions will still benefit. that is good news for them. american farmers and ranchers tends to the export-based from here and bad news for small and medium-sized americans based exporters, they will not benefit from these high standard comprehensive rules and most dynamic fastest-growing part of the world. >> i don't have a lot to add to that. for us, it is a question of

having that architecture and being linked into all of these economies, half of them we didn't have agreements with including mexico, canada and japan. one thing i didn't say in the speech, which is driving the way we look at this, there is a tendency to think when negotiating fta or original agreement the job is done when you get ratification or entry but our experience in asia, saying you get a lot of benefit from all the structures, regular meetings of the committees and all those things, and the relationships from there and the trust particularly dealing with different cultural and political systems, from new zealand it is a no-brainer, to

have a chance to sit down with people, bring people to each other's countries and see how things work, amazing how much progress you make in that. >> let me turn to the audience. please wait for the mike and identify yourself. right there. it is not aerobics. >> a very vocal stance that the wto is not built to handle the economic system of china. given that premise, how can it be handled bilaterally, a vehicle like tpp, a new initiative to get to formally hear about.

how can countries play a role in trying to do this, is this not welcomed by the trump administration? >> was that for any particular panelist or whoever wants to bite? >> i'm happy to jump in. the economies today, the wto rules haven't changed significantly but the world has. we need to see updates to the wto rules regarding not just china but all systems. to the tpp was originally envisioned as a race to the top. initially you may recall that the chinese were very critical of tpp and it was designed to

contain them. when japan joined the negotiations and countries continued outreach to the chinese, we want to brief you on this. we want you to be aware of it and we went you to join, we want you to race to the top, they actually began to change their view. there was a meeting a few years ago in bali where the prime minister said he could envision china joining tpp in a few years which was remarkable. fast forward to where we are now, i think the trump administration is right to focus on the challenges with the chinese economy and the trilaterals between the us, japan and eu on nonmarket economies is a good start. i would like to see that initiative expanded to other

countries who share the same concerns. elizabeth mentioned them. japan is already in. our qb friends share the same concerns about subsidies, excess capacity, the list goes on. i would love to move into developing a coalition to deal with nonmarket economy issues and i will stop there. >> if i could add, it is true that some of the issues, many that have been raised fall outside wto rules but wto embodies fundamental principles that should govern our trading relationships, specifically nondiscrimination.

so there is a framework, we base ftas on that. it might not be an fta the china and the us agree, ten years to negotiate but certainly there is a framework principle on which both countries can draw to forge a new accommodation. to go to tami overby's point, we are looking forward to seeing the outcome of the trilateral process to see if it can translate into a broader coalition, and we have launched with japan and singapore and initiative on e-commerce. still -- philip houlding mentioned some areas that are not covered in the wto. >> next question in the middle here. >> merrily, international trade today. i will direct this to elisabeth

bowes. it took ten years to negotiate your fta with china. it seems the current administration does not have that kind of patience. what is your view if there is a victory declared in the next 6 months but core issues are not addressed? do you feel it was wasted pain in terms of tariffs if that is the outcome? >> just, i alluded to this in my last response. australia always pursues free-trade agreements and certainly with china we got the best ever fta outcomes china had negotiated so there is a reason for that. what the us is aiming at is not

comprehensive or quite clear what the outcome is, but any outcome that sticks back from tariff escalation which is helpful not only to us and china economies the global economy, is important. it is not wasted. i think a 6-month timeframe or even 3 months, 90 days, is ambitious but it doesn't mean at the time one normally stops negotiating, we have some inbuilt agendas. so any positive progress towards an arrangement is something we would welcome very much. >> mary berger with washington trade daily. this is for anyone who wants to answer but i believe all the speakers mentioned the need for

wto reform so i wonder how optimistic you are about wto members reaching a consensus on wto reform and how quickly that can happen. >> don't know why everyone is looking at me. to be honest i think it is an impossible question to answer. new zealand, you have to be an optimist to be in this game, particularly if you are a new zealander in this game giving you don't bring any power to be equation. we are optimistic that good ideas can work and be accepted so that is what we are trying to do, provide good ideas and square the circle where it needs to be.

it is impossible to say we are evaluating time frames. it is too important, people are heavily engaged. this is a discussion happening in real-time in geneva, fingers crossed as soon as possible. i couldn't give you a timeframe. i am sorry. >> anyone else? >> we will put that in the to do list for 2019. >> great panel. fill lane with training for america. there are generally two rules on trade conflicts. one is if you have a trade war, there are no winners. there is also a counter view, which is there really are trade winners and they are not involved in the trade war. since the official start of

hostilities with china, which was the beginning of july, us numbers, exports to china have trended downward mainly because of soybeans, but us imports from china have gone up dramatically primarily because of people trying to get ahead of the tariffs. we used to call that a pre-by but that is going on. i don't know if that has leveled off. my question to you is since hostilities started in july have you senior exports to china, the us, go up, go down, are you benefiting from it at least in the short term? i noticed some countries are initiating trade diversification programs so they are not dependent on one or two markets. that is particularly true in

canada. any thoughts on the bystanders whether you are benefiting the short run or be hurt in the long run? any insight on what is going on on the ground seeing that the one measure folks tend to focus on his bilateral trade deficit? >> thanks, bill. i anticipated your question. to be frank it is a bit soon. we are not soybean producers like brazil and argentina that can fill the gap. we don't see much evidence of us filling a market niche but i can say our exports to china have increased year on year but that is largely attributable to the progressive tariff cuts but

i know that tami overby pointed out tariff differentials with tpp and the us not being a part and we cringed the numbers on tariff differentials on our exports to china and the us. for example, due to the tariff cuts and retaliatory tariffs china has imposed on key products, we have a 90% tariff advantage and the 26.2% tariff advantage, l and g, we have a 90% tariff advantage. fta, not necessarily translated into actual exports but you can see the differential but i have to say we don't look at this as time for short-term opportunity, we much prefer stability and predictability in the system and adherence to

global rules so that is why we are concerned about increasing trade tensions and the damage caused by the tariff or tally asian. >> an example, japan is buying soybeans from heads of state and us disputes, the price of soybeans is degrees of cost. that is good for the japanese buyer in the short term. on the other side, that is good but the stability is much more important. in a sense, that kind of thing. another thing, japanese

factories establishing -- they are buying car parts from china. that is the price raised by the price of the things. >> on the supply chain relocation we are seeing companies, no one is leaving china that we are dealing with but a lot of people are reallocating their supply chains. the us destination products, they are looking at philippines, vietnam, malaysia, thailand, indonesia, even bangladesh, as places to consider relocating us-based manufacturing. >> you have given me an opportunity to align the

bubble, the ambassador brought this up, she said i could use it, blame it on her. the line was, it doesn't matter if they are making love or war. i just thought that was a call for stability. nobody moved too much. i am trying to squeeze this into something coherent. like others, for us, any short-term gain is outweighed by impacts on the system and global stability that might be coming. the nature of new zealand's trade with china and the us means this is part of consideration how the markets will grow but not that big a part of it.

as an example i worked for the meat industry before i came here. in 2009 or 10 we were doing nothing into china. we are now up to 40% of our land goes to china and something like 10% to 20% of our base. there is huge growth in that market, the same story for australia. based on aca and other things, this happened. if there's going to be impact on new zealand it is more likely to be on economic growth that might impact people's willingness to buy products from new zealand. what the us, our trade with the us has been long-standing and stable. the effect on the economy has been going so well, there's more of an impact than the trade dispute at the moment.

>> i have a question for the ambassador from new zealand. australia and new zealand, fighting security grounds. to improve the reason, i am wondering how you talk about security concerns with business with china. >> congratulations. i am sorry, can't really talk about it, and new zealand legislation state up around

telecommunication system. there are significant changes to networks by the private sector, they need to consult with security agencies, that happens, on a neutral basis, they have been identified and not visible, the process is followed, and we will see where it goes from here. >> i am going to associate myself with the embassy. it is not a matter we can discuss, but a matter of great consideration.

>> the source of all of this is the american baseball player, yogi berra, who famously said it is always dangerous to make predictions, especially about the future. the corollary of that is it is always difficult to make predictions, especially about donald trump. there are three things that are safe to predict. what is this administration has has its great cause, the subduing of chinese broad-spectrum practices in technology and subsidies, that they feel are essentially antithetical to us interests. the second thing that is worthwhile or useful to understand is they concluded the wto won't do it for them. i submit this is not just

because they have a discouragement with wto procedures, but they do not see the membership of the wto including even people like japan and europe that are in discussions as being essentially willing to go to bat with them at the wto to address these issues. the third thing to keep in mind is everything, everything this administration does shouldn't be taken at face value. it should be taken as how do they see this as leverage? what do they see it as leverage for? let me tell you where i am going with that and ask you to react. the great task, it seems to me, of the world trading community should be to get the united states to resume its face in the wto as the basis of rules-based rating that will

solve the problems it sees as serious problems. the obvious thing to be considered, it is a risky consideration for a lot of countries, is for the major trading countries, the eu, canada, australia, japan, to join with the us in a comprehensive wto case against chinese practices. that should be done it seems to me, with the corollary that you have to let the wto system survival is they are in the process of dismantling it by dismantling by the end of this coming year the wto dispute settlement and they would have to agree to allow the wto system to revive. the problem is it makes this a binary world for us with the us

and its allies against china. the effect on china is difficult to see, the effect on your relations with china is difficult to see. i pose that here is the problem to deal with unless you want the us to say we will continue to deal with his unilaterally. it probably won't work and when it won't work we will do something more severe. i suggest to you, you have to consider radical things like that and if you don't, we have a lot of trouble ahead of us. i ask if you have any views if that is even possible for the major powers to consider. [laughter] >> a very broad question. for those issues raised between

the us and china, the issue between this and china, we have that. if japanese interests, going to be by those issues, we would like, now that you have processed the process properly. as you said, we are discussing these issues between the bilateral discussion between the united states and japan. those issues, including wto reforms.

it is not simply the use of wto in these issues. we can say that now. >> just to add to that, the trump administration's view on the multilateral approach is evolving. they came in saying we would do everything bilateral, we are the largest economy in the world, we are going to america first, we are going to squeeze everybody. the example is the trilateral with japan and the eu on a nonmarket economy. from my personal perspective i wish they had come in and focused on china first and built that coalition rather than going after all our friends and allies first and then getting to china.

it is important to note there is bipartisan support in this town for the attention on the challenges with china and with all of the asian governments i speak with they are in agreement that this is a challenge we need to work on together. i am hoping there is an opportunity, but no idea on the timeframe. >> if i could just add, maybe it is a question that the panelists don't want to answer but there is a clear expression from time to time from this administration that whatever market opening can be achieved with china should benefit american companies and american interests, which again, you are kind of, that takes it back into a bilateral box, but one where if there is some progress could come at your expense.

>> i think wto members are willing to address this issue and maybe this has been a bit of a time coming. we have not had new rules for quite some time in some areas. in some areas we have. in 2013 we had some good outcomes. if we can, we don't like the unilateral approach and we think it is harmful to both sides. bill made the point, trained pools don't have winners for participants, we have seen the harm to those economies. i think eventually the unilateral approach will be demonstrated to not be successful and then the us will be forced to and already is,

turn to its allies for a broader and longer lasting solution. i also don't think tariff leverage will necessary produce a longer-lasting solution. you don't want the framework of rules to underpin the solution to provide predictability and stability. >> we have a few minutes left. any questions before we break? paul? >> next time, two microphones, i promise. >> my name is paul. i'm with the us agency for international development but this is in a personal capacity. there is a lot of optimism about further progress at the wto. for somebody who sat in on

committee meetings in geneva, one of the dynamics the needs to be addressed is not so much the relationship between the united states, japan, china and other players in geneva but developing countries and the role they play, increasing amount of attention this administration is giving to the relationship it has with developing countries as compared to the one the chinese have been developing in that part of the world. i am wondering if any of the panelists would care to comment on how they see the dynamics of that playing out and what role they see themselves playing in terms of bringing along developing countries in a lot of these dialogues because whether you are talking e-commerce or fishery subsidies or whatever the issue may be, those developing countries are going to play a much more important role than would have been the case in the past. >> perhaps taking e-commerce as

an example with japan and singapore, we are pleased 17 members signed on to the e-commerce initiative in what is areas -- windows there is --buenoa aires. the trading system in globalization is not just about big giants but all participants in the system having access and a recognition of the fact that economic growth has supported economic development across the globe. and particularly going back to our theme. the most dynamic of regions in asia, it is important all countries be brought along. it is difficult but important to address new issues that do indeed touch all countries.

separate from the wto, we certainly urge the us to maintain and increase economic engagement in the region, the indo pacific region which includes a lot of developing countries. and a few initiatives have been announced by this administration which we welcome and usaid might tie in. it is not just about the wto but broader economic engagement in the region to support economic development. >> with respect to that developing division, one of the achievements of tpp is this mix of developing and developed countries. basically the outcome is everyone has effectively the same obligations. you account for that developing

status with different lead in times and transitions and technical assistance. i just put that forward as potentially a model down the line. it is difficult for countries to face the issue of having losing to some extent domestic support for trade and it is a difficult thing for those of us with the problem in the developing world to justify why other countries, some of whom are wealthier than us, don't have the same obligation. so i just leave that out there as an issue that will need to be solved and i wonder if the cpt pp approach gets is involved? >> on that optimistic note, i wish you all on behalf of all of us, happy holidays.

thank you for pulling together another fantastic panel. we really appreciate all the work and contributions you make to the discussions in washington. thank you. [applause] [inaudible conversations] [inaudible conversations] ♪

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reforms of the healthcare bill. there was no interest in doing reforms because it was all about winning politically and not governing in a sustainable way. those are regrets that i have. >> ideas matter to me and you try to get ideas in the press and they don't care. they are against your ideas and they put them down and they cannot name a substitute that is better. they don't have an alternative hypothesis. it is an intellectual pride -- fraud and that is what the president did. >> most people think term limits are like a good idea. leadership has no term limits. nancy pelosi will probably be over 100 by the time she finishes as speaker if nothing changes. the challenge is all of leadership has no term limits,

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who look like me were cornered by snarling police dogs or dealt with sugar and catch up as they sat stoically at lunch counters. i heard about people who looked like me gone missing, from toddlers into rivers. i heard other names for people who looked like me, names with ugly edges, names to make us smaller, quieter, less boisterous, less of ourselves. >> sunday at 9:00 eastern on afterwards, the other side of freedom, the case for hope. he is interviewed by naacp president and ceo derek johnson. >> you make the case for hope. wise (blooge is there a difference between faith and hope. >> we have to fight for it. everybody who came out of the streets, deeply rooted in the system we got.

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