The global economy and table seating at the world business buffet

VentureOutsource.com talks with William G. Parrett, Chairman of the United States Council for International Business (www.uscib.org). Tapping into his current responsibilities and, previous experience as former CEO with Deloitte Touche Tohmatsu, Mr. Parrett shares with us his understanding of the challenges companies must deal with when facing a global economy.

In this exclusive interview, read what Mr. Parrett says about the impact changes in technology have on America and U.S. jobs; transparent business practices in foreign and emerging markets, his unique perspective on India and China, and more.

Transcripts from that discussion follow.

VentureOutsource.com: What do you see as the current, single most important threat abroad (e.g., law, rule, policy) that has significant potential of undermining American competitiveness? What, specifically, is the United States Council for International Business (USCIB) doing to help address this?

Parrett: As we enter turbulent economic times, there is a clear risk that many countries, including the United States, might slide back into protectionism. There are already numerous examples of countries erecting new barriers to foreign investment.

Some people are advocating ‘green' tariffs, to punish products from countries that don't commit to cutting their carbon emissions. And, of course, the U.S. election rhetoric on trade is very troubling.

USCIB works closely with business groups in other countries to forge internationally acceptable alternatives that keep markets open. For example, we're really urging the G8 governments to affirm their commitment to cross-border investments, in both words and deeds.

William G. Parrett
Chairman
United States Council for International Business

(Image courtesy of BDI G8 Business Summit)

And we're working to rally support to wrap up the Doha Round of global trade talks with a meaningful, market-opening agreement. That's the single biggest thing governments could do to keep the global economy on track. A strong global economy should benefit all peoples and be a big step towards a global rule of law and order.

VentureOutsource.com: Open markets can help drive innovation and create better products and services. Such markets can also result in job loss and economic decay in regions / companies unable to develop or sustain a competitive edge which can lead to protectionism. What are your thoughts on protectionism when concern is voiced by states, industries and companies possibly facing a net loss of jobs due to offshore outsourcing?

Parrett: Because of changes in technology, the threshold for companies that can or must go offshore has come down a lot. It's not just big multinationals, a lot of smaller companies are now outsourcing abroad.

This obviously creates anxiety among some people about job loss, and we need to be able to deal with changes in the job market through better investment in training; education and skills, as well as improved trade adjustment assistance for those who do lose their jobs as the result of trade.

But interestingly, the fact that so many more companies are trading and investing overseas also means that one core source of support for protectionist policies, that is, manufacturers who produce solely in the United States, has gotten smaller.

Also, I think there's greater public recognition now about the nature of jobs in America. Very little of our job losses lately have come about as the result of trade or offshoring. Technology and changes in the marketplace account for most of job losses in America. But the benefits of open markets for U.S. exports, corporate payrolls, and overall economic success is enormous. Like it or not, the world truly is flat, and those who recognize it will benefit.