APEC FACT SHEET: THE IMMEDIATE ACTION PACKAGE

Detailed market-opening plans in the following areas will be concluded by the first half of 1998, aimed at beginning implementation in 1999:

Environmental Services and Technology

APEC commitments to open-up trade in this rapidly-growing sector will deliver substantial opportunities for U.S. companies. Global production of environmental technology and services is currently estimated at $420 billion annually. Data for 1994 showed average market growth rates for environmental goods and services in APEC countries between four percent for Japan to a high of 20% for some developing economies.

The U.S. environmental technology industry employed an estimated 1.3 million Americans in 1995, with domestic revenues of $180 billion. Industry estimates that U.S. exports in this sector in 1995 were $14.5 billion. Though the United States is the world's largest exporter of environmental technology, exports currently account for just eight percent of total industry revenues. The United States thus has substantial potential for the rapid increase of environmental goods and service exports--particularly with a successful sectoral agreement to open major foreign markets.

Medical Equipment and Instruments

The lowering of tariff barriers on medical devices and scientific instruments has the potential to increase trade and reduce health care costs on a global basis. This agreement will facilitate the free flow of medical technology products and contribute to cost-effective health care in all economies.

The United States has a broadly diversified industry that is the world leader in the production of all major product areas, including surgical and medical instruments; orthopedic and prosthetic appliances and measuring and testing instruments. Industry estimates that in 1996, the U.S. industry accounted for nearly 50 percent of global production of medical devices.

Last year, the United States exported about 20 billion dollars in medical devices and scientific instruments, or over 26 percent of world trade in these products. Demand for medical technology has skyrocketed in recent years in APEC economies, with annual growth in consumption estimated at 19 percent or higher in key markets. Last year, about half our exports went to APEC economies, particularly Korea, Taiwan, Singapore, Thailand, Malaysia and China. Currently, over 400,000 U.S. workers are employed in the production and exportation of medical equipment and scientific instruments. Strong export growth in this sector will significantly expand the number of these high technology jobs in the United States.

Chemicals

Virtually every manufactured product--from automobiles to zippers--depends on thousands of kinds of chemicals. Food, clothing, shelter, health care, transportation--and every other facet of modern life--are all dependent on modern, high-tech chemical compounds. The United States is a highly competitive producer of chemical products and will benefit substantially when foreign consumers of U.S. chemical products can purchase U.S. products at more competitive rates.

For years, chemicals have been among the largest areas of U.S. exports, supplying over $1 of every $10 of U.S. goods exports and earning large
trade surpluses ($163 billion over the past ten years) exports were $61.8 billion in 1996, with a trade surplus of $16.9 billion. Employment in 1996 was 1.03 million. These workers are highly skilled and take home one-third more pay per week than the average for U.S. manufacturing workers as a whole.

Energy Sector Goods and Services

Opening-up trade in energy-related equipment and services will materially contribute to expanded installation of energy supply systems around the world. Shipments of energy equipment totaled $51.6 billion in 1995 and the industry employs about 350,000 workers. U.S. exports of energy-related equipment are conservatively estimated at over $15 billion per year (1996) with a trade surplus of $6.5 billion. Exports account for an estimated 34 percent of total energy equipment shipments by U.S. producers. By 2005--with good trade agreements in place--exports are expected to exceed U.S. production for domestic consumption.

MRA on Telecommunications Equipment

A significant portion of telecommunications equipment is subject to regulatory approval. This proposal will reduce the costs and speed up the process of product approvals, thus facilitating trade and enhancing the benefits expected form the tariff elimination on this equipment under the Information Technology Agreement. The proposal will reduce the number and overlap of steps necessary to satisfy importing countries' approval processes. It would allow exporters to pre-test and certify equipment to an importing economy's mandatory technical requirements.

The U.S. industry additionally favors an MRA as a means of coping with ever-shortening product life cycles. The U.S. telecommunications equipment industry employed 216,000 workers in 1995. Exports from the U.S. of telecommunications equipment amounted to $15 billion in 1996. Shipments by the industry are expected to increase by about 8% in constant dollar value in 1997.

Forest Products

Free trade in forest products is good for the consumer and good for business. Reducing barriers to trade in wood products will provide more abundant and less expensive housing. On the paper side, improved access to more affordable packaging and printing materials will lower manufacturing costs and prices. More open trade in forest products supports improved forest management practices that are under discussion in various fora; conversely, current tariff levels on forest products contribute to the inefficient uses of valuable forest resources.

The 1996, the United States exported $29 billion of products covered by this initiative and could further expand exports, if trade barriers were reduced. The U.S. forest products industry accounts for nine percent of total U.S. manufacturing output and ranks sixth in size among manufacturing industries. Products covered in the initiative account for 3.2 million U.S. jobs, with 1.4 million in wood and paper, 1.6 million in printing and publishing and 200,000 in furniture.

Fish and Fish Products

The initiative will ensure that trade can continue to develop and benefit all APEC economies, consistent with cooperation to secure greater certainty of future fisheries resources. The United States is the second largest exporter of fisheries products in the APEC. Some 86% of U.S. fisheries exports in 1996 ($3 billion) were shipped to APEC economies. The current trend of rapidly increasing exports to APEC economies other than Japan is expected to continue, reflecting the rapid growth of standards of living and disposable income in the region. This accord will eliminate tariffs, as high as 55% in some economies, and panoply of non-tariff measures including licensing requirements, import quotas, and standards which restrict market access. The elimination of subsidies which have the effect of distorting investment and market conditions will have a positive impact in reducing the current problem of overcapacity, resulting in better resources management and their sustainability.

Toys

U.S. tariffs on toys are already at zero, as a result of the Uruguay Round, as are others in APEC and the WTO who joined the Uruguay Round zero for zero initiative for toys; others still have tariffs of about 10-30%. The removal of tariffs on toys by other countries will increase business opportunities for producers, distributors, and investors, and increase choice and lower prices for consumers.

The U.S. toy industry employed 38,000 workers in 1995. About 30,000 of these were production workers. U.S. toy manufacturers are among the most competitive in the world. U.S. exports of toys totalled $898 million in 1995. The American toy industry is very supportive of this initiative.

Gems and Jewelry

Total U.S. output of jewelry in 1996 is estimated at $5.7 billion. The United States exported of $392 million of precious metal jewelry in 1996, as well as $152 million in costume jewelry. The U.S. jewelry employs an estimated 76,00 jobs, mainly in small companies. APEC imports of gems and jewelry were about $6.7 billion.

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