Deputy Secretary's Speech

Deputy Secretary of Commerce David A. Sampson
Arab Chamber of Commerce
Houston, Texas

Thank you, David Phillips, for that kind introduction. As a Texan, it is always a pleasure to visit my home state and on this trip I’m honored to be joined by such a distinguished group from Bahrain. I am pleased that you decided to visit Houston on your trade promotion tour. We’re delighted to have you. In my unbiased opinion, you made a wise choice.

I visited Bahrain in early February and was shown tremendous hospitality during my trip, and I am pleased that I am able to join this delegation to ensure that they receive the finest Texas hospitality in return. Shaikh Mohammed, it is wonderful to see you again, and congratulations on your new citizenship. I applaud your efforts to keep advance Bahrain’s dynamic economy and promote strong trade and investments linkages with the United States.

I also want to recognize Khaled AL-Zayani, the president of the American Chamber of Commerce in Bahrain, which is the first AmCham to be accredited in the Gulf. I am delighted to welcome you to Texas.

I know your visit will deepen U.S.-Bahrain commercial ties. We’ve already had a great time in this wonderful city. Last night we were at the Houston Rodeo and Livestock show, and enjoyed a little Texas hospitality. And I am sure that this visit and the partnerships formed will be the basis for strong ties between the U.S. and Bahrain for many years to come.

My recent visit to the Gulf was my first time in the region, and I was truly impressed by all the economic expansion. Like Houston, Bahrain is dynamic, energetic, and full of opportunity.

Despite modest size, Bahrain has maximized its resources over the years to develop the economy and create a modern place to do business in the Middle East. As the Crown Prince has said, when you are a small country, you have to be focused, nimble and strive for excellence if you are to attract investment, create opportunity, and grow prosperity. And I know other countries in the region are looking at Bahrain as a model of economic liberalization and entrepreneurial spirit.

U.S. – Bahraini Relationship
The U.S. and Bahrain have had a strong relationship for over 100 years. American missionaries began their work in Bahrain in 1893. The modern American Mission Hospital in the capital of Manama is a testament to their work and contribution to Bahraini society.

Additionally, the U.S. Fifth Fleet is based in Bahrain. Bahrain has been a steadfast ally in U.S. military operations in the Middle East. We greatly appreciate Bahrain’s partnership in the War on Terror. Our goal and vision at the Commerce Department is to make our economic and trade relationship with Bahrain as strong and successful as our political and strategic partnership.

Bahrain is a special place, bustling with economic activity and a leadership that is positioning Bahrain to compete not only in today’s global marketplace, but for the rest of the 21^st Century. Whenever I visit with the Crown Prince Shaikh Mohammed, I’m always impressed that they are thinking 10, 15, 30 years out as they conceive and implement their economic development strategy. Bahrain has earned a reputation as a progressive nation that has taken considerable initiative to create this strong global economic identity.

In 1932, Bahrain was the site of the first oil discovery on the Arab side of the Gulf. When faced with declining oil stocks years later, Bahrain moved to create a diverse multi-sector based economy that would long outlast its mineral resources.

This strategy has paid off and Bahrain is currently a trading center in the region, boasts the freest economy of any Arab country according to the Heritage Foundation, has positioned itself as a massive financial services center, and is a leading exporter of aluminum.

Bahrain’s democratic mindset makes it a leader and pioneer among its neighbors in the Middle East. Bahrain’s recent elections are a testament to this spirit and it is for this reason that I am optimistic about Bahrain’s democratic, economic and trading future.

Bahrain’s Economy Open and Growing
The new U.S.-Bahrain Free Trade Agreement is the latest chapter in this unfolding story of rising economic opportunity. It’s the first such agreement between the United States and a Gulf country.

President Bush is very proud of this new agreement. And it is a testament to the vision, determination, and wisdom of the Government of Bahrain.

Since taking effect, trade is up between our two nations, and business interaction is at an all time high. Our bilateral trade in 2006 topped $1 billion for the first time.

• U.S. exports to Bahrain rose 40 percent to $490 million. And Bahraini exports to the U.S. rose 46 percent to $632 million.

FTAs Are Good for Business
But there is even more we can achieve. Free trade agreements like the one with Bahrain give companies like yours the tools to expand and broaden your businesses.

A free trade agreement with the United States is the gold standard of free trade agreements. It serves as a “seal of approval” demonstrating high levels of free markets, rule of law and transparency. Thus, countries that have signed an FTA with the United States also see a rise in FDI and trade with other countries. So I encourage you to look to Bahrain as a good place to invest and expand your businesses.

The FTA formalizes our growing economic partnership. And it gives U.S. businesses duty-free access to virtually every sector of the Bahraini market while doing the same for Bahraini businesses in the U.S. market.

Already we’re seeing progress:

• Microsoft is planning a major, four-fold expansion of its office in Bahrain.
• Kraft foods recently announced construction of a new $40 million production plant.
• And Bahraini investors are talking with U.S. alternative energy research companies to set up facilities in Bahrain.

Global, U.S. Economy Expanding
Let me talk for just a minute about the performance of the U.S. economy. Because of our openness and competitiveness, the U.S. is doing very well, and strong enough to overcome a number of shocks. In recent years, our economy has continued to thrive despite terror attacks at the heart of our financial district, war, and natural disasters of historic proportions.\

• We’ve had 21 straight quarters of economic growth. That’s five years of uninterrupted growth. Growth in 2006 (3.3 percent) was above the previous 15-year average.
• 111,000 new jobs were created in January. Nearly 7.5 million jobs since August 2003 – more than in the European Union and Japan, combined.
• Unemployment is a low 4.6 percent. That’s below the average of the last four decades.
• Real after-tax income per person has risen by 10 percent since President Bush took office.
• And our exports are booming. In 2006, U.S. exports reached an all time high of over $1.4 trillion dollars. Our exports grew 13 percent. And, for the first time in nearly a decade, our exports out-grew our imports.

So, clearly we have momentum. And the key to keeping that momentum is to ensure our companies stay competitive and have access to global markets. That’s why President Bush has been so committed to pursuing Free Trade Agreements.

FTAs Leverage our Businesses
Free trade agreements give us leverage in the global economy. Since President Bush took office, we now have FTAs with 11 countries, five of them in the Middle East. And seven more FTAs are in the pipeline.

Globally, 18 trade deals aren’t very many. But while our FTA partners only account for roughly 7 percent of global GDP, over 40% of U.S. exports are shipped to our FTA partners.

Doing business with the United States is profitable and that’s why you see such a diverse group of Bahraini firms and interests represented here today.

I’m confident that the creativeness and innovation that has brought Bahrain to the economic forefront among its neighbors will continue well into the future.

Bahrain has the potential to be an even greater economic power than it already is. Bahrain’s prospects are good, and its future bright. And I urge you to take a look into this growing market if you haven’t already.

The U.S. Department of Commerce is here to help you do just that. We have staff here in Houston and in other cities throughout Texas. The Department’s Export Assistance Centers do a fantastic job facilitating US exports. In fact, some members of the team are here today. Our staff at the Commerce Department in Washington, D.C. and the U.S. Embassy in Bahrain also stand ready to assist you.

Additionally, my good friend Ambassador Belooshi and his team at the Bahrain Embassy are ready to assist you in this process as well. His efforts have already led to several trade and investment deals for American and Bahraini companies.

Conclusion
I want to express my strong appreciation and gratitude for Bahrain’s friendship and for everyone’s interest in coming here today to hear the story of Bahrain. It is a positive story that is not told often enough.

I look forward to continuing the successful partnership between our two nations and encouraging greater trade and business activity for many years to come.

Thank you very much.