SPI: International Trade Update

For SPI Members Only – January 19, 2006

In This Edition

HILL ACTIVITY

Let Your Voice Be Heard in Washington! . . . Participate with SPI in the 2006 Manufacturers' Fly-In hosted by the National Association of Manufacturers (NAM). On February 7–8, 2006, U.S. manufacturers will convene with lawmakers on Capitol Hill to discuss energy and other critical issues impacting manufacturing in the United States. As we approach the 2006 mid-term elections, this event is a prime opportunity to let federal legislators hear the concerns of the plastics industry. The Fly-In will also feature guest speakers who will discuss economic forecasts for manufacturing, innovation, the skills gap, and other challenges that manufacturers confront in today's competitive environment. For more information, or to register for this event please contact Natha Freiburg at (202) 974-5216 by January 20, 2006.

Legislative Trade Agenda for 2006 . . . The legislative calendar for the new Congressional session is fairly short (due to the mid-term elections) but busy. In the international trade area, lawmakers will likely ratify the U.S.-Peru and U.S.-Oman free trade agreements (FTAs). They will also likely debate legislation related to trade with China, as well as measures pertaining to stronger intellectual property rights (IPR) protection. According to Congressional staff sources, lawmakers may also move forward on a miscellaneous tariff bill that has been held up in the House for several months. SPI is closely monitoring legislative developments and, when appropriate, will call upon members to write letters supporting legislation beneficial to the plastics industry. For more information, please contact Karen Toliver or Gennie Ross.

CHINA UPDATE

ChinaPlas 2006 Is Approaching! . . . Asia's No. 1 Plastics and Rubber Show featuring more than 1,300 exhibitors will be held April 26–29 in Shanghai. This year's show will cover 90,000 square meters with 10 pavilions from Austria, Canada, Germany, India, Italy, Japan, China, Taiwan, the United Kingdom, and the United States. Attendees will have the opportunity to view the latest technology in plastics and rubber machines, establish important business contacts, and purchase products. SPI is co-sponsoring the U.S. pavilion and our representatives will promote the U.S. plastics industry and meet with Chinese industry and government officials to discuss plastics industry concerns. If your company plans to attend and would like SPI to help facilitate meetings with potential business partners, please contact Karen Toliver. More information about the show is available at www.2456.com/chinaplas.

TRADE ENFORCEMENT

SPI Opposes EC Draft Decision on Cables . . . The European Commission (EC) recently notified WTO members of a proposed fire safety regulation of electric cables used for construction in the European Union (EU). The proposed regulation seeks to adopt an acidity criterion for testing the fire safety of cables – a measure that would potentially ban fluoropolymer-based wire and cables from the EU market. SPI joined the voices of PlasticsEurope, the Cable Fire Safety Research Association and other industry groups, which have long opposed the EC's proposal, and presented information to EC decision-makers that the requirement is scientifically and technically unsound, is inconsistent with applicable international standards and unfairly discriminates against fluoropolymer materials. SPI also condemned the EC proposed measure as a technical barrier to trade in violation of the EU's WTO obligations. The EC is currently considering comments filed by these industry groups. For more information, please contact Karen Toliver.

Commerce Seeks Comments on Intellectual Property Protection at Trade Events . . . As part of its Strategy Targeting Organized Piracy (STOP!) initiative, the Commerce Department is examining ways to strengthen protection of intellectual property rights at trade shows and other events. Commerce is seeking private sector input to get a better sense of the range and frequency of intellectual property (IPR) violations that may occur at such events. If your company has experienced or observed IPR problems at a U.S. or foreign trade show, please consider sharing your experience with SPI staff by contacting either Karen Toliver or Gennie Ross.

New Justice Department IPR Coordinator for Asia . . . The Justice Department recently announced the appointment of a new "Intellectual Property Law Enforcement Coordinator (IPLEC) for Asia." The new Coordinator is Christopher Sonderby, an experienced prosecutor within the Justice Department. Sonderby will be stationed at the U.S. Embassy in Bangkok, Thailand, and will oversee U.S. government efforts to combat IPR violations throughout Asia, with a particular focus on Southeast Asia. SPI continues to monitor developments related to plastics-specific IPR issues. As a member of the U.S. private sector's Coalition Against Counterfeiting and Piracy (CACP), SPI is positioned to communicate IPR concerns to Commerce and Justice Department officials. For more information, please contact Karen Toliver or Gennie Ross.

New Comment Period on the EU RoHS Directive . . . On January 13, 2006, the European Commission (EC) announced a new "stakeholder consultation" process for exemptions to the Restriction on Hazardous Substances in Electrical and Electronic Equipment (RoHS) directive. As of July 1, 2006, lead, mercury, cadmium, hexavalent chromium and the flame retardants PBB and PBDE used in a wide range of electrical and electronic products sold in the EU market will be severely restricted. The EC has already approved a number of exemptions, and is now seeking comments on the possible exemption of 13 uses of lead and cadmium in electrical components, such as those used in musical instruments, surge protectors, loudspeakers, vacuum tubes, audio equipment and gaming machines. The deadline for the submission of comments is February 10, 2006. Click here for more details on this consultation. Additional information on RoHS and the related Waste from Electrical and Electronic Equipment (WEEE) directive is available on the EU website.

TRADE AGREEMENTS AND NEGOTIATIONS

U.S.–Morocco FTA Implemented . . . The U.S.-Morocco FTA entered into effect on January 1, 2006, a year later than its original implementation date. The Agreement was scheduled to take effect on January 1, 2005, but had been postponed due to delays in Morocco's adoption of legislation needed to comply with its obligations under the deal. Morocco is a fairly small market for the U.S. plastics industry. U.S. plastics exports to Morocco totaled $9.48 million in 2004, while plastics imports from Morocco amounted to $125,000.

President Notifies Congress of Intent to Sign U.S.–Peru FTA . . . President Bush has notified Congress of his intent to sign the recently-concluded free trade agreement (FTA) with Peru. Consequently, the U.S.-Peru FTA will likely be signed in early April 2006 and ratified by Congress during this summer or fall. The negotiations with Peru occurred under the auspices of a wider "Andean" FTA that would include Colombia and Ecuador. However, talks with Colombia and Ecuador remain ongoing. In 2004, the U.S plastics industry shipped goods worth $174 million to Peru and imported goods worth $1.7 million. Peru imposed tariffs ranging from 4 to 12 percent, with the highest tariffs imposed on intermediate and final goods. During the negotiations, SPI worked with U.S. trade negotiators to seek tariff elimination on the largest categories of plastics shipments to the country. As a result, when the U.S.–Peru FTA goes into effect, Peru will eliminate tariffs on resins, certain products, machinery and molds. Tariffs on plastic pipes and tubes, bags, certain household goods, certain film and sheet will be cut and eliminated over a five-year period.

U.S.–Korea FTA Business Coalition Launched . . . On January 12, 2006, the U.S. Chamber of Commerce and the U.S.-Korea Business Council launched a coalition to support a proposed U.S.–Korea FTA. Although USTR has not yet formally announced the start of such talks, many U.S. business interests support a FTA with South Korea because it is the United States' seventh largest export market and the 11th largest economy in the world. If U.S.–Korea FTA negotiations are launched, the goal will be to conclude the talks by the end of 2006 or early 2007.

WTO UPDATE

WTO "Mini-Ministerial" Meeting to Be Held This Month . . . Discussions on the Doha Round of multilateral trade negotiations among U.S. and foreign trade officials have resumed this month and will likely continue at the ministerial level on January 28–29, 2006 in Davos, Switzerland. According to USTR sources, achieving a framework agreement by the end of April will require steady attention and flexibility from senior trade officials. U.S. trade negotiators remain steadfast in seeking significant tariff cuts and elimination of non-tariff barriers for industrial goods. SPI continues to work with USTR and other industry groups seeking greater market access for plastics industry goods.

EXPORT PROMOTION – TOOLS TO EXPAND YOUR MARKETS

Commerce Department Export Promotion Webinars . . . The U.S. Commercial Service is offering a free monthly web seminar program for U.S. companies looking to enter or increase their presence in key foreign markets. Between now and April 2006, this program will include webinars on opportunities in Central America, South Africa, China and India. The first webinar was held on January 19, 2006 and focused on sales opportunities and export strategies in the CAFTA-DR region (Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the Dominican Republic). Click here to access a flyer listing upcoming webinars. More information on doing business in the CAFTA-DR region is available here.

Commerce Department "Exporting to China" Workshops . . . The Commerce Department has launched a series of workshops to help U.S. companies enter the Chinese market successfully. While not specifically targeting the U.S. plastics sector, some of the seminars provide general information on how to access the Chinese market, plan your IPR strategy, evaluate the best sales prospects for your products and how the U.S. government can help you succeed in China. These workshops, featuring current and former U.S. Commercial Service officers who have served in China, private sector industry specialists, and local exporters, are scheduled for cities throughout the country from January to May 2006. Click here to access a flyer with more information on this workshop program.

GLOBAL BUSINESS COUNCIL

GBC Program on Central and Eastern Europe . . . Always at the forefront of global issues impacting the plastics industry, the GBC is organizing a program to be held during NPE 2006. Attendees will hear about developments and business opportunities for plastics manufacturing in Central and Eastern Europe. Stay tuned for more details.

Join the GBC! . . . Does your company experience difficulties in exporting overseas? Are you concerned about import competition in your market? Do you want to have input on planning trade missions to overseas markets and SPI's positions on trade policy matters? Then consider joining SPI's Global Business Council.

The GBC's mission is to increase global awareness and competitiveness by providing resources to SPI members, while fostering growth of the plastics industry worldwide. All SPI members in good standing are eligible to join. If you are interested in joining the GBC, please contact Karen Toliver. More information on the GBC and its activities is available on the SPI website.

The Society of the Plastics Industry, Inc. · 1667 K St., NW, Suite 1000 · Washington, DC 20006-1620