Were leaving this program here to take you back to the conference on free trade and prosperity with forum perspectives on trades and regulations. The last discussion of the day on free trade and agriculture, all of it available later on cspan. Organization. Without further adieu were excited to welcome our two extremely impressive speakers, experts on the topic of trade. Ultimately trade is an activity between countries. It may be carried out by individual people, and businesses working in the global economy, but this conversation would be incomplete without the International Perspective on this topic. That is why the Mccourt School is excited to welcome these two participants who will speak on the panel, foreign perspectives on trade. First off, we have nancy mclaren, president and ceo of the organization for International Investment an association representing the unique interests of u. S. Subsidiaries of global companies, or insourcing companies. Nancys advocacy efforts focus on educating legislators on the Important Role u. S. Subsidiaries play in the American Economy and policy issues that would make the u. S. A more competitive location for Foreign Direct Investment and job creation. Her expertise on crossborder investment trend and related legislative initiatives are often thought and cited by the media including nbc news, cnbc, abc news, the new york times, and the wall street journal, financial fumes, and washington post. She was recently recognized by the hill newspaper as one of washingtons top lobbyists among socialsed. She hold as masters of economics from George Mason University where she received a fellowship from the Ludwig Institute and bachelors of economics from Virginia Polytechnic Institute and state university. Next we have European Union ambassador david osullivan. Mr. Osullivan has had a long and distinguished career that spanses five decades. He served in number of senior official posts in the European Public service. Prior to his appointment as Eu Ambassador to the u. S. , he was chief operating officer of the European External Action Service and responsible for establishing this new eu diplomatic service. The service is one of the largest Diplomatic Networks 140 delegations across the globe. Am bass osullivans career includes number of notable and senior positions within the european commission. Head of Commission President cabinet, secretarygeneral of the european commission, director general for trade and chief negotiator for the Doha Development round. He was responsible for overseeing the launch of a number of freetrade agreements and concluded eus agreement with south korea. Before joining the commission he started his career with the Irish Department of Foreign Affairs and trade. Mr. Osullivan graduated from Trinity College dublin with a degree in micks and sociology and completed postgraduate studies at college of europe. While at trinity he was auditor and debating Gold Medalist of the College Historical society and winner of the irish times debating competition. He holds an honorary doctorate from the Dublin Institute of technology and was awarded a second honorary doctorate from his alma mater, Trinity College. He also has been a visiting professor at the European College of parma. Welcome me in joining the panel on foreign perspectives of trade. [applause] good afternoon. It is wonderful to be here. Im nance my mcclaren, ceo of organization of internext investment. I have a pleasure of representing over 200 companies. These are all foreign firms that have made a deliberate decision to invest in the United States and employ americans here. Across the country, almost 7 million americans get a paycheck from foreignowned companies. Companies like japanbased toyota, germanbased siemens, switzerlandbased nestle, and canadabased burger king. These companies probably have a lot to do with your daytoday existence from the trains you take to work in the morning or cars that you drive, the buses your kids get on in the morning and even your after dinner drinks as well. There is Foreign Investment in some parts of the u. S. Economy and supports a lot of the u. S. Workforce and i think that were almost to the point where it is really, really difficult to tell whether a company is a u. S. Firm or a foreign firm. Thank you to the Mccourt School. Honor to be here today with ambassador sullivan, and to be able to have a conversation about trade policy. You all heard the very distinguished career and i know that he has a lot of to offer, you have a lot to get into it. So mr. Ambassador, its conference send titled does trade still matter . As a former trade negotiator and director general for trade i have a feeling as to where you might be on that question, but lets go ahead and, can you set the stage and talk about this and highlight the magnitude and importance of the u. S. Ue relationship. Well, thank you very much, nancy, thank you for the invitation from the Mccourt School and glad to have this conversation. Does trade matter . Yes. Trade is the ultimate driver of Wealth Creation and productivity and efficiency increases. I studied economics and im not sure that it is a science. If it is it is a pretty dismal science as we know but there is one bit of economics that i learned early on which actually is a law and that is the law of comparative advantage which states very simply, even if a country could produce everything it needs it actually makes more sense to focus on those things you produce most efficiently and trade the rest. Your country does better out of that and other countries to do, and wealth increases and Economic Activity continues to increase. I think is a, there is no country. There is no country in history that has grown prosperous and better way of life to its citizens without trading. So trade is absolutely indispensable part of our economic life. The transatlantic corridor, talking about euu. S. Relation is the single most important economic corridor in the world bar none. We have two out of the three largest economies in the world. When i first arrived here, actually the eu economy was slightly bigger. I could say america and china were battling for second and third place. The Exchange Rates moved things around a bit. So i have to be less hubris but i will say were two of the three largest economies in the world. We represent 50 of gdp and we represent 30 of world trade. We trade 1. 7 billion euros across the atlantic daily. 70 , we own collectively 78 of Foreign Direct Investment stock globally, and 80 to your point earlier, of Foreign Direct Investment in the United States comes from the European Union. So this is, a massively important economic relationship, both in terms of trade, in goods and services but also, perhaps more especially in terms of investment. Thanks. Could you talk a little bit, so weve got the numbers and even beyond the numbers of the importance of the relationship between the u. S. And the eu but can you actually talk a little bit more how sort of citizens of the world, outside of those regions benefit from the strong relationship between the u. S. And the eu . Well, i think, you know, you have indicated the ways in which there is significant European Investment here in the United States. We estimate that roughly about 15 million jobs are created across the atlantic between the eu and u. S. , roughly divided between us. European investment here created about 7 million jobs, roughly the same number in europe. And, you know, makes a huge difference. But the, the other regions also benefit. I have often expressed regret at the american decision to withdraw from tpp. Some people said oh, this is opportunity for europe. For us the success of the Transpacific Partnership would be beneficial to europe. Were also negotiating in the asianpacific region, but, when you increase Economic Activity, you suck in through the supply chain, you create new opportunities, you create new wealth, consumers are buying other products, they are not just boeing to buy them. Americans are not going to buy from europe. Well not just buy products from the United States. When you createticsal Economic Activity, it spreads beyond the two partners in the trade relationship. So i, i helped form my organization in 1990. So there have been involved in the sort of Foreign Direct Investment issue area for almost 30 years now. But from 1990, until i think about 2015, we saw a general upward trajectory of support for globalization. There is a couple hiccups here and there, but around the world i think we were seeing more and more, sort of want to embrace globalization and figure out a way in which to play in the kind of game of that. Over the last couple of years, i think weve seen a heightened skepticism towards Global Connections. And i would like to get your view on where do you think were seeing that in the u. S. , in europe. Talk a little bit about that. What do you think could be implications if we start kind of moving away from more and more connectivity between countries . I think youre right. There has been a growing criticism of globalization. I mean it seems from,. Almost a bad word now. Yes. I must admit i still use it in a positive sense but youre right. I mean i think there are a number of reasons for that. Probably single biggest driver of equality. We have to acknowledge for all benefits that our market economy system has brought, if you look at the numbers, they are quite frightening in terms of the rise of inequality and the goop between the richest gap between the richest people in our sights and least welloff. I dont think it is because of globalization but more of Public Policy and what kind of company and flanking policies you have to accompany trade. Im a big fan of trade. You need accompanying policies where trade is disruptor. Places where new jobs are created often not the same places they will be lost whether geographically or sectorly. You need to in order to have the political acceptability but in terms of social justice you need accompanying policy, Regional Education and training, investments in regions which are badly affected to help them through the transition. Perhaps we have done slightly better in europe an the United States. The backlash in europe in my view is slightly less than here. The other element with globalization though it has nothing really do to with trade, of course linked to it, the issue of immigration and a sense of cultural identity which in my view tend to get mixed up, the issue of economics and cultural identity. It is absolutely clear in answer to your first question it would be an act of enormous selfharm if our societies seek to close borders, do less trade, all reasons of ive indicated. Trade is driver of increased prosperity for our countries and our regions and for the rest of the world. We should not forget the position of leastdeveloped countries who desperately need trade opportunities in order to continue ton their path from, from low level of development to improved prosperity and welfare for their citizens. So, how do, i think it is incumbent upon us, those of us who support and benefits that open borders can bring. How do we deal with some of the issues or help, you know, answer some of the underlying concerns that those that oppose trade have in order to keep moving in a positive direction on globalization . Certainly income inequality is part of it but as we know that is not all driven by globalization, right . And maybe, even less than some people might think, technological developments, really causing a lot of disruption as well. If we only focus on globalization as the possible cause for inequality, then the socalled solutions wont really solve some of these problems . Well, i agree with you that stopping trade or trade barriers are kind of a false panacea to the problem. I do think, but then we get into political territory, i mean im probably more certainly in american terms a left liberal. I think actually there is strong role for government in Public Policy counteracting some of the market deficiencies or some of the effects of a free market. In europe we like to talk about the social market economy, not just the free market economy. I think that is hugely important. You need public intervention to correct some of the distortions or some of the the equalities flow from unbridled play of market forces. But that of course, brings you into tricky politics, very often people who are defending the global approach are also people who would defend a rather laissezfaire, small government policy at home the i dont think that actually works. I think if you want to promote globalization, open borders, free trade, you need to address the consequences, not so much consequences issues which arise out of that, inequality, unemployment in certain regions which will be certain sectors who will fine themselves affected. I think we need much more imaginative thinking, the traditional leftwing response of state ownership or these things are failed. They are busted flushes. We need much more creativity how we address those issues. If we dont, in my view well see on both sides of the atlantic a growing disenchantment with the economic and political process and people will end up voting for people who may have very bad alternative solutions. Can you compare the u. S. And e. U. A little bit in terms of how they are viewing globalization . Here in the states we have seen a rise of economic national system. Better way to put it. Skepticism around multilateral trade agreements. Wouldnt want to say we invented trade because maybe parts of the arab or the asian world would say they invented trade. Weve been traders going babb as long as our history back as long as our history recalls. And i think in europe there is a recognition that trade is fundamental, even starting between us. 28 countries and Member States in the European Union. You cannot drive more than a couple of hours in any direction without crossing a frontier and without understanding if you want to put barriers up between us, were going to be less well off. I think we did go through a bumpy period a couple of years ago on the trade front, but i think weve come through that. We just concluded a very comprehensive agreement with cab da, were upgrading canada, were upgrading our Free Trade Agreement with mexico, we will sign a very comprehensive agreement with japan in the summer. This will be the biggest Free Trade Agreement ever representing nearly 30 of global gdp. Weve already concluded with singapore, with vietnam, and we are actively engaging with chile, and we will open negotiations with australia and new zealand very shortly. So i think the mow men tear hiccup of momentary hiccup of people saying trade dealers deals are the way forward has turned around many europe. When she finishes her mandate in november of 2019, europe if all goes well will be at the center of the largest free Trading Network the world has ever seen. So i think thats the trajectory were on. Now, it can go wrong, it can be derailed, there canning be political problems here and there. All of this requires an enormous amount of work to continue to persuade people of the benefits and the advantages of this kind of trade opening. We, i think, are still supporters of the mull fewty lateral system, but multilateral system, but we have to admit that the negotiating arm of the wto is going through a difficult period, and well have to see how we can address that. Finally, your point about how our companys perceived, i mean, american Foreign Direct Investment, japanese Foreign Direct Investment is always welcome because they bring jobs, they bring opportunities. And i have the sense here, i must say ive been traveling around this country quite a lot. I was down in South Carolina recently where theres, you know, huge European Investment. Theres a big bmw, massive bmw investment there. You go to the point of charleston, you can see them exporting bmws to germany by the container. Theres a very big italian investment in making cables. Ive been to mobile, alabama, where theres an airbus factory. I sense these companies are all welcomed by hour communities, they their communities. So i think on both sides of the atlantic people at the end of the day just want the same thing, they want a decent job, they want an opportunity, they want a chance to earn a decent living and look after their families. And 230r7b direct investment is an important part of providing that on both sides of the atlantic. Lets talk a little bit about innovation and