Deputy Secretary's Speech

Deputy Secretary of Commerce David A. Sampson
American Chambers of Commerce in the Middle East
Cairo, Egypt

In 2004, welcoming President Mubarak to his ranch in Texas, President Bush said "Our nations have a relationship that is strong and warm. Our people share the bonds of friendship, a commitment to prosperity and peace and regional stability. Egypt is a strategic partner of the United States and we value President Mubarak's years of effort on behalf of peace and stability of the Middle East."

My visit here is intended to reinforce President Bush's commitment to Egypt and countries in the region.

It's a special pleasure to visit Egypt--a dream for me, as for so many Americans, because all of us as children study the origins of civilization here in your great country. I bring you greetings from Secretary Gutierrez, who returned from his visit here just a year ago full of confidence in your country and in the strength and potential of our trade relations. We congratulate Egypt on its accelerating success in expanding its trading relationships with all countries--including the United States. Your success also supports America's interests, advanced by President Bush, in promoting global freedom and prosperity through free trade, especially throughout this critically important region.

• First, let me thank Dr. Helmy for his leadership and commitment as President of AmCham Egypt and current Chairman of the AmCham MENA Council. Dr. Helmy, on behalf of the Department of Commerce and US businesses in this region, thank you for your service and vision.
• As former President and CEO of a Chamber of Commerce, I have great respect for the crucial role that chambers play in establishing a positive business community.
• So I also want to acknowledge all of the other chairmen, presidents, and members of the regional AmChams including Turkey who are here today for your leadership and commitment. And a special thank you to the full members of the AmCham MENA: Egypt, Jordan, Lebanon, Bahrain, Morocco, Algeria, and Tunisia.
• I also wish to acknowledge Minister of Trade Rachid and Lebanon's Minister of Economy, Minister Haddad.

As we all know, security can dominate the conversation across the Middle East. Today, however, I would like to focus on trade. As President Bush has said many times, "Open trade fuels the engine of economic growth that creates new jobs and new income in the United States and around the world."

In a region and a time of conflict and uncertainty, America supports the aspirations of the people of the Middle East -- particularly its young people -- for peace, freedom, and greater economic opportunity. I don't have to tell this gathering that commerce and industry have a central role to play in helping people achieve a better life and ensuring future stability throughout the Middle East. Business opportunities continue to develop in this region. Long-term partnerships are being formed to further integrate this region into the global economy. The United States wants to be a partner in this process.

Strengthening our commercial and economic ties and aligning regional economies with ours will not only build stable and diverse economies, but also will enhance the quality of life and raise the standards of living for citizens of this region. While extremists preach hate and despair, business and industry, and the governments that support them, will provide jobs, opportunity, and hope.

Actually, our economies and our businesses are more interdependent today than ever. It is increasingly true as more nations lower barriers to trade and investment, and diversify their economies. Just as Americans now enjoy more choices than ever among the best quality products from around the world at the most competitive prices, so too, demand is rising for American brands throughout the world. People throughout this region continue to value American technology and managerial expertise as they seek to build their societies and to grow economies at the highest of world standards.

But let me reassure you, we do not take our business partners for granted: today's business environment is more fiercely competitive than ever. We welcome global competition as vitally beneficial to American producers as well as consumers. Egypt and so many of your neighbors have demonstrated in the past several years that you do possess the determination and skill to compete successfully and to uplift your societies, despite the painful stresses of adjusting to today's globally-integrating economy.

Earlier I mentioned that this region is the birthplace of civilization. It is also the birthplace of faith. This week, I have visited the ancient and active mosques, churches, and synagogues where faith is celebrated. The U.S. was founded on the principle that our citizens should have freedom to express their faith and worship the Almighty according to the dictates of their conscience.

That vision is a reality in the U.S. today, and partly explains why Americans are known for our confidence in ourselves and a confidence in free people everywhere, and for our optimism about the future. We have the deepest confidence also in Egypt and its future, and in the good people of the Middle East.

That is why we have established Free Trade Agreements with several countries of the region, and have begun to negotiate others; that is why we have established Qualified Industrial Zones among us and regional partners including Egypt, Jordan and Israel. In the case of Egypt, exports from QIZs witnessed an astounding 51 percent increase from the third quarter of 2005 to the third quarter of 2006. This expansion has retained or created over 100,000 Egyptian jobs.

Critical role for MENA AmChams
Egypt is my first stop on this trip and for good reasons given its role in the region. I will also visit Israel, Jordan, Bahrain, and Oman. Along the way, I will stress the critical role the MENA AmCham Council and AmChams across the region have in advancing economic reform and encouraging businesses to expand this role to stimulate economic growth and reform.

Trade, whether regional or global, lowers prices for consumer goods, improves welfare and quality of life, and most importantly, creates jobs.

The current unemployment rate of 15 percent is too high for a region whose labor force is going to increase by an estimated 85 percent by 2020. We must work together to create a business environment that can utilize this workforce and give it the skills and opportunities to contribute to the global economy.

Many of you have taken great strides: Here in Egypt, the AmCham is promoting and implementing the Qualified Industrial Zone (QIZ) program and ensuring the rapid growth of U.S.-Egypt trade.

• With strong leadership from the AmCham, Jordan is forging stronger trade with the American economy and continues to generate success under the FTA.
• The AmCham in Lebanon helped initiate the Trade and Investment Framework Agreement (TIFA) process and has participated in the Made in America trade fair. Lebanon's AmCham will play an indispensable role not only in Lebanon's reconstruction and recovery from the terrible conflict of last summer, but also in pulling your country together in the face of those who would divide you.
• Bahrain, the first fully-accredited AmCham in the Gulf, is working overtime to promote their new FTA.
• In Morocco the AmCham is promoting their FTA and facilitating U.S. business in Morocco.
• In Algeria the AmCham is helping U.S. companies win contracts for infrastructure development.
• The Tunisian AmCham is working with their government to further advance our bilateral TIFA agreement.

It's a long list of activities, and it clearly shows commitment to encouraging growth and trade in this region. I know many of you are working with fellow AmChams to share best practices and develop more successful programs.

Secretary Gutierrez and I salute you for all of your work and accomplishments, and we reaffirm to you that the Department of Commerce is eager to assist your efforts in any way that we can to build stronger trade relations between and among our countries.

I would also like to highlight the positive role of U.S. business in the region. Earlier in the week, I had the privilege to be with Minister of State Darwish (DAR-Waash) and our Ambassador Ricciardone to tour the micro-enterprise center at the Foreign Trade Training Center. This initiative is supported by one of America's leading companies, HP. This is a superb example of public-private partnership, where the government and the private sector work together towards a positive change. I understand similar types partnerships, but in different areas, are thriving between the government of Egypt and many of our companies including Apache, Cisco, Google, Intel, P&G, Microsoft, and NCR to name just a few.

MEFTA is the Future
President Bush's vision is for the United States to have open trade with the entire region, including North Africa, in seven years. He also sees much greater trade within the region itself. A Middle East Free Trade Area (MEFTA) will bring open markets, new technologies, strengthen the rule of law, create jobs, and expand economies. These elements are critical to this region's future.

We are very proud of our latest trade agreement with Bahrain, our first with a Gulf country. Bahrain is now seen by many as having the freest economy in the entire Middle East. Services account for 50 percent of Bahrain's GDP. This creates opportunities for U.S. firms, but also creates jobs for Bahranis that never existed before.

Jordan was the first Arab country to sign an FTA with us, only five years ago. Since then our exports to Jordan have more than doubled, to $650 million -- but, Jordan's exports to the U.S surged over 1,600 percent, to nearly $1.3 billion! Open trade policies and privatization efforts are paying off dramatically for Jordan and for all of its trading partners.

Challenges Ahead
I hope that I've been able to demonstrate that we've seen a lot of progress in recent years, but clearly there is much more that can be done. I see several challenges ahead.

First, we're seeing a rise in protectionist sentiment both in the U.S. and around the globe. This is a failed policy. There is no example in history of long term growth or prosperity that came as the result of protectionism and isolationism. And we should not sacrifice long-term growth and progress for fear of competition.

To combat this, we need to aggressively pursue the Doha round of world trade talks, negotiate new and enforce current trade agreements, and perhaps most important, educate people about the benefits of trade.

Bahrain, Egypt, Jordan, Morocco, Oman, and Saudi Arabia are examples of the success that can be achieved by opening doors to international commerce and diversifying economies. We encourage Algeria, Lebanon and Yemen to move quickly to accede to the WTO and join their Middle East neighbors and become full members of the global trading community.

I believe that the United States and many nations in the Middle East share common goals of openness, democratic rights, peace and better jobs and a better future for our children. And I believe that AmChams are the most effective promoters of these ideals.

We recognize that a future of shared opportunity and expanding prosperity nurtured by broad economic cooperation is the best strategy for peace, stability, and the triumph of hope in the Middle East and throughout the world.

I appreciate your leadership in this region; each of your organizations is having a profound impact in your country and is improving peoples' lives. I applaud you and your organizations. And finally, I thank you for inviting me here to speak to you today.

Thank you very much.