MODERATOR: Thank you for coming everyone. It is my pleasure to introduce Secretary of Commerce Carlos Gutierrez who is here as part of a regional tour. He was actually in Iraq yesterday and spent today meeting with his counterparts here in Kuwait. The general purpose of the Secretary's visit is to promote stronger commercial ties between the United States and Kuwait and to also promote the business climate in Kuwait. We do not have much time; the Secretary has a plane to catch. So, with that I am going to turn it over to the Secretary who will tell us a little bit about his meetings today and the purpose of his visit, and then we will turn it over to questions. Thank you.
SEC. GUTIERREZ: Thank you, this was a great opportunity to come to Kuwait and reaffirm our very special friendship with the Amir with Shaykh Nasser Al-Sabah with Minister of Commerce Al-Hajiri. We had some very good meetings. We talked about where we go from here from an economic standpoint. The Amir has a very bold vision for Kuwait ; he sees it as a center of trade and finance for the region. So, we talked about how we can use our commercial dialogues and our current frameworks to enable the Amir, and help him to achieve his vision.
MODERATOR: Diana [Associated Press] Q: Can you give us some basic figures on the trade balance between Kuwait and the U.S. and how you would like to see it and what needs to be done? SEC. GUTIERREZ: I believe and we will confirm these numbers. I think we export about 1.9 billion dollars and we import I will say about 2.5, although it is a bit higher than that. So, there is a trade deficit and a surplus in favor of Kuwait. We do not set numeric goals for. Was I close? Yes, the trade deficit is about 3.3 billion, 1.9 exports to Kuwait and a little over 4 from Kuwait , so, a surplus in favor of Kuwait. The way we approach trade with countries is not so much by setting a goal of where the surplus or deficit should be, but in using trade to create opportunities and to create jobs and to create growth. And, in some instances that requires us to have a trade deficit. So, we want to do more business with Kuwait and we believe there is more business to be done and that is the important goal.
Q: Your Excellency, can you give us an idea why if FTA is lagging behind what has been achieved with Oman , and Bahrain , and other countries in the region? SEC. GUTIERREZ: The FTA, I am sorry could you.
Q: (Over the Secretary) Between Kuwait and the United States.
SEC. GUTIERREZ: Well, we have a, what we call a TIFA.
Q: A framework.
SEC. GUTIERREZ: A Trade Investment Framework, which is a foundation for an FTA in the future. We have an upcoming meeting in September to discuss the TIFA, and that's a very important meeting because there we will be able to discuss progress. We will be able to discuss next steps and what we need to do to lead toward an eventual FTA.
Q: How do you evaluate the progress on the TIFA so far? SEC. GUTIERREZ: There has been good progress on behalf of the government of Kuwait in the area of intellectual property. We believe that there is more to be done and that is one of the areas that we will talk about as part of TIFA and one of the areas that will help us get to an FTA. But, we should recognize first and foremost that the government of Kuwait has made very important progress. There is also the area of standards, which we believe should be internationalized so that they are more compatible and more conducive to trade, to be able to trade with other countries. And then, clarification on taxation policy, which we talked about, and the positive aspect is that we heard that all of these areas are being addressed either through legislation or through another way they are being addressed.
Q: Are these the main snags? SEC. GUTIERREZ: I would say they are the opportunities to get us to a future where we can do more business together and the opportunity for Kuwait to achieve that great, bold, and very ambitious vision the Amir has set.
Q: How feasible do you think the vision is? SEC. GUTIERREZ: I think it is very feasible especially if you think about the location, if you think about the way this economy has been managed. This is one of the, you know, it is one of the highest per capita income in the world. I do not know what number it is, but I would not be surprised if it was one of the top ten. In fact, definitely one of the top ten. So, there is a foundation, there is an infrastructure, there is an environment to be able to develop to achieve the Amir's vision. There is work to do when you have a bold vision, it never comes easy. But what I saw today is great alignment, understanding, and clarity of a vision among members of the cabinet.
Q: Could you elaborate more on what needs to be done? SEC. GUTIERREZ: From our standpoint, from the standpoint of the United States and Kuwait , we believe that eventually getting to an FTA would be a significant step toward that because of what an FTA does for investment in the country, trade within the country. And it attracts...it will attract investment that would see Kuwait as a headquarters, as a regional hub, as a regional center, as a financial center. So, all those areas, the ability to do that would be facilitated by an FTA. So, an FTA we believe is one of our important contributions that we can make to the Amir's vision.
Q: Some analysts believe that Kuwait is the best threshold to make business with Iraq, how does the Department of Commerce look upon this matter and do they encourage American businessmen to start their business in Iraq from Kuwait? SEC. GUTIERREZ: Well, obviously in an open market business people have to do what is right for their business. I was just in Iraq and I am working with my counterparts in Iraq to help them create an environment that will attract capital and that will attract business people, and we hope that in the future they will be able to attract investment from all over the region. But the private sector and business people will have to decide how attractive of an investment that is. There are a lot of opportunities in Iraq today to invest and to grow, and we hope that many companies see that, and we hope that Kuwaiti investors see that. But obviously the decision is in their hands.
Q: You mean in the hands of Kuwaiti investors? SEC. GUTIERREZ: Yes, yes.
Q: What about the security situation? SEC. GUTIERREZ: Security is a challenge today and, as you know, this is their number one priority. There is now, for the first time, there is now a permanent government, there is a unity government made up of all of the elements of society. There is a full cabinet in place, a cabinet which is fully staffed. So, now there is a team, there is a government elected by the people and they have set... they know that their number one priority is security. And, President Bush has talked very often about the three components of their strategy, which is security, political, and economic. So, I was there to talk about the economic and what needs to be done to attract investment and help them create jobs and create hope for people.
Q: Did you find, did you meet considerable cooperation and preparedness from the Iraqi side? SEC. GUTIERREZ: They are very.they understand the challenge; they understand that security is their number one challenge. However, they are moving ahead thinking about the economy. They have an investment law that will hopefully be passed. I believe it has been passed through their Council of Ministers and it will go to their Council of Representatives shortly. That will be a major step forward. But there is still a lot of work to do, there is no doubt about it, there is a lot of work to do and we stand ready to help.
MODERATOR: We have time for maybe one or two more quick questions.
Q: We forgot to address the most important thing. What is objective of this visit, and you said you were in Iraq too, so what is the...? SEC. GUTIERREZ: I went to Iraq to meet my counterpart. This is the first time that I have traveled to Iraq. The reason for this timing, as you may know, President Bush was in Iraq several weeks ago to meet the new government, to meet the new cabinet, to meet the Prime Minister. And then President Bush directed several members of his cabinet to meet their counterparts and to start working together to help them build...one of those components of their strategy and in this case it is the economic component. So, I went to Iraq to meet my counterparts, to discuss an agenda, we signed an agreement of commercial cooperation. We are going to develop an advisory board so that we can get a real tangible agenda and start making things happen on the economic side. Given the proximity, I thought it would be a great opportunity to come to Kuwait , reaffirm our friendship, pay my respects to the Amir, and also meet my counterpart who is relatively recent in his role. I believe that I have accomplished those two goals and I can now get on an airplane and go back to the hot weather of Washington , D.C. (laughter).
MODERATOR: Last question Q: I wanted to ask about the U.S. investments in Kuwait , can you give us a figure and what do you think would be the most important thing for Kuwait to do to improve that? SEC. GUTIERREZ: The. Let me give you a number here. This is my secret sheet (laughter).
Q: Right. Can I ask for a copy of that, a secret copy? (laughter).
SEC. GUTIERREZ: There is close to half a billion dollars of investment.
Q: Half a billion? SEC. GUTIERREZ: Half a billion in Kuwait, and as the Amir achieves and as the country achieves the Amir's vision of becoming the center of finance and trade that will enable U.S. companies to find more opportunities to invest. We were just talking this morning about how there are many U.S. companies here already, and you see many U.S. brands. We hope there will be more in the future and we hope that many of these companies will take an interest in Kuwait , given that this is a favorable environment. As I mentioned before, there are some opportunities -- IPR, taxation standards, but we are confident that the government of Kuwait is taking these on and they fully understand that this is a way to make Kuwait even more attractive for U.S. investments.
Q: Do you expect the FTA negotiations to start in 2006? SEC. GUTIERREZ: We cannot really say when because a lot depends on how much progress we make on the TIFA meeting. I will say this, it is very important that there is a time limit to our FTA due to some legislative matters in our congress. So, it is not an open schedule. It is one that requires a certain amount of urgency, but that will depend on how much progress we make from now to the meeting that we have in September and beyond that. So I will have a better read after September.
MODERATOR: Unfortunately..
Q: (Over the moderator) Is there a deadline? SEC. GUTIERREZ: No, we want to get it right. Our goal is to get it right.
Q: Thank you.
MODERATOR: I wish we had more time. Thank you very much for coming sir.
SEC. GUTIERREZ: Thank you, thank you very much.
Source: U.S. Department of Commerce
