May 19, 1986
Secretary Baldrige, Ambassador Yeutter, good morning to all of you, and welcome to the White House. It's an honor to have you join us to help celebrate World Trade Week. Together, we can underscore the significance of international trade to our nation and the world. And by the way, I can't help but recall that in my former career I had something to do with exporting for overseas markets myself. In those days American motion pictures occupied more than 75 percent of the playing time of all the screens of the world. Unfortunately, the movies that we sent overseas sometimes -- well, they weren't always successful. I had one called "Cattle Queen of Montana." [Laughter] It lost something in Japanese. [Laughter]
But it's important for us Americans to reflect upon the extent to which our nation is involved in international trade. One in six of our manufacturing jobs and one in four of our farm acres produce merchandise for overseas markets. Roughly speaking, every billion dollars worth of American manufactured goods exported means more than 25,000 American jobs. And overall, today nearly 5.5 million American jobs are connected to exports.
And yet despite its importance, international trade faces serious challenges. Large and sometimes massive trade imbalances among the major trading nations have given rise to strong protectionist feeling both here at home and abroad. Yet ever since the disaster of the 1930 Smoot-Hawley tariffs, we've known that protectionism doesn't work. No, the way to promote worldwide prosperity is not to erect barriers, but to bring them down; not to decrease international trade, but to expand it. And we're working to do just that. Our approach has been threefold.
First, we're doing all we can to provide an economic environment that's conducive to exports around the globe: international economic stability, innovation, and growth. And in this regard, we're having historic success. Here at home our own economy has grown for 41 months, creating more than 9\3/4\ million American jobs. Inflation in our nation is running at the lowest level in two decades, and the prime rate of interest has dropped by 60 percent since we took office.
Abroad, we've been working to achieve closer economic policy coordination between nations, foster improved global growth, and promote greater exchange rate stability. Indeed, closer economic coordination between us and our trading partners was agreed upon at the Tokyo summit. We're pleased to see that other nations -- in part spurred by our own growth, in part following our example of low taxes and limited government -- have a good outlook for more economic growth of their own. The Plaza agreement that was reached last September has contributed to substantial exchange rate changes, improving our own competitive position. And the debt problem in lesser developed countries is being addressed, providing expanded markets for American trade. All this adds up to a sound basis for a wider and freer world trade.
Second, we're working to remove foreign trade barriers that may be blocking the sale of otherwise competitive American products. As I said in my trade address on September 23d of last year: ``All must work to guarantee open markets -- free trade is, by definition, fair trade.'' Since September we've initiated investigations into unfair trade practices by other countries, making ours the first administration to initiate such investigations on its own. Today we've cases underway concerning Korean barriers to foreign insurance companies, Brazilian restrictions on computer imports, Korean violations of intellectual property rights, and Japanese restrictions on imported tobacco products, as we've started our first investigation into Taiwan's foreign export performance requirements.
In that same September speech I just referred to, I announced the formation of a strike force to identify unfair foreign trade practices and recommend strategies for combating them. The strike force has been hard at work. We've initiated an antidumping case against Japan for its practices involving exports of semiconductors. We've begun consultations with European governments on airbus sales. And we've proposed legislation to strengthen and expand the protection of intellectual property rights and adopted a formal policy in the enforcement of such rights.
Third, we're working to negotiate new trade agreements that will expand world trade for the benefit of all nations. At the recent Tokyo summit, we and our allies once again affirmed our support for a new round of multilateral trade negotiations, targeting the September GATT [General Agreement on Tariffs and Trade] ministerial meeting for decisive progress. At the summit we also agreed that this new round of talks should have a comprehensive agenda, including new topics of particular interest to the United States, such as services, intellectual property, and investment. And still pursuing the goal of expanding trade, we've also begun to explore the advantages of negotiating a comprehensive free trade agreement with Canada, our largest trading
partner. In trade relations with Japan, progress is, again, being made. When Prime Minister Nakasone and I met in April and again at the Tokyo summit, we agreed on the need to expand our trade through better market access. Indeed, I'm gratified at Japanese efforts to restructure their economy to expand domestic demand. Based on previous work, the Japanese are now committed to lowering Japan's barriers to imports of telecommunications equipment, medical equipment, forest products, pharmaceuticals, and electronics. Like many of our trading partners, the Japanese are tough negotiators. I think many of you here know that firsthand. But we're determined to do all we can to lower trade barriers in Japan and throughout the world.
These actions are all constructive steps aimed at expanding trade. And that's why I'm dismayed at protectionist legislation that is under consideration in the House of Representatives. It isn't a fair trade bill; it's a ``less trade'' bill. It will not open markets to U.S. products; it will close them. It will mandate that the United States violate many of the most basic rules of international trade. And it would expose our most productive farms and industries to retaliation by other nations.
The creation of a strike force, the enforcement of our trade laws, vigorous trade talks with Japan and other nations -- it is only right that we in government should make those efforts. But in truth, our nation would be nowhere without you -- you who've shown such initiative in opening new international markets. You're proof that American business has never been afraid to compete, that our business community is as innovative, efficient, and competitive as any on Earth. My friends, for setting such high standards, I thank you.
And now it's my privilege to sign the proclamation and then to ask Secretary Baldrige and Ambassador Yeutter to help me present the "E" and "E Star" awards for excellence in exporting. So, I'll take pen in hand.
Note: The President spoke at 11:46 a.m. in the Rose Garden at the White House. In his opening remarks, he referred to Secretary of Commerce Malcolm Baldrige and United States Trade Representative Clayton Yeutter. Recipients of the "E" Award were the Automotive Parts and Accessories Association, Lanham, MD; Ferguson Industries, Dallas, TX; Kustom Electronics, Lenaxa, KS; Macbeth Division, Kollmorgan Corp., Newburgh, NY; Mayer Wildman Industries, Inc., Orangeburg, SC; Greater Los Angeles Convention Bureau, Los Angeles, CA; Paper Machinery Corp., Milwaukee, WI; Timberland Co., Portsmouth, NH; and Xport, the Port Authority Trading Company of the Port of New York and New Jersey. Recipients of the "E Star" Award were the Colonial Beef Co., Philadelphia, PA; Dale Electronics, Inc., Columbus, NE; First Interstate Bank, Denver, CO; Panelfold, Inc., Miami, FL; and Sunnen Products Co., St. Louis, MO.