Ambassador Baucus’s Remarks to the American Chamber of Commerce

AMBASSADOR BAUCUS:  Thank you Hanscom very much for that very kind introduction.

Before I go any further, I’d just like to say that Hanscom Smith is one of our best Consul Generals, not just in China but around the world.  I’m a big fan of Hanscom Smith.  Let’s give a big round of applause to Hanscom.

Thanks as well to Ken Jarett.  I’m getting to know Ken better all the time.  There’s nothing like four visits to Shanghai to get to know Ken Jarett a little better.  He’s a great guy.  As well as Bob Theleen, I’m a big admirer of Bob Theleen too, and for their joint leadership in the Shanghai Chamber of Commerce.

And I’d especially like to thank Mayor Zhou Bo and his delegation for making this evening such a great success.  And I might say, on a personal level, the Mayor and I are becoming better friends.  We just a few minutes ago exchanged our WeChat telephone number so we could chat.

I just learned about WeChat, well, I knew about WeChat several months ago, but during the last few days since I’ve been in Suzhou and Shanghai, I’ve learned a lot more about WeChat and I’m just so impressed with the vitality and the energy that the Chinese people have in using WeChat.  I decided I’ve got to get a WeChat account.  So I have, and Mayor Zhou is one of my first friends.

Thank you again, and congratulations again to Shanghai American Chamber for just a terrific, successful year, and you’re about to celebrate your 100thanniversary.  It will be next year.  It’s obvious why you’re doing so well.  You’ve got such energy, such dedication.  Good job.

One hundred years ago, as AmCham Shanghai began, our countries faced a new century.  Woodrow Wilson was our President and he famously said, and I’ll quote him, “We are not put into this world to sit and know.  We are put in it to act.”  I think his words are just as relevant today as they were back then.  As we also start a new century, it is time for all of us, regardless of our background or business interests, to step up and act.

I‘ve often said, and many others have often said, that this is one of the most important bilateral relationships in the world — between the U.S. and China.  And we need to get it right.  That cannot be said too many times.  It must be said over and over again.  It is the most important bilateral relationship in the world, and we must remember that as we proceed and act.

The clock is ticking.

This is a special year in the U.S.-China bilateral relationship.  It marks 35 years of diplomatic relations between our two countries.  Thirty-five years ago, Deng Xiaoping and President Jimmy Carter very courageously began to normalize the relationship between our two countries, to make this a better place.  It’s up to us to follow up with their courage and continue on to make this relationship even stronger.

And trade and investment are cornerstones of our relationship.  Just look at the more than $60 billion in foreign investment in China that helps drive China’s growth.  $60 billion.

As I stated, this is my fourth visit to Shanghai since I became the U.S. Ambassador to China, and each time I come to this city I make a point to visit as many U.S. companies as I can, to learn more about their growth and their challenges.

During my July trip, my wife Mel and I visited the future Shanghai Disneyland site, and I see the Disney table right out there.  It reminds me of the wonderful time that we had at the site.  That will be one of the largest United States investments in China.  I can tell you that, as I talked to Disney executives, Bob Iger told me that this is his most exciting project since he’s been CEO of Disney.  He’s so involved in it, it’s a big challenge, but he likes it so much, and we’re proud that Disney is here in China.  I know you in Shanghai are proud that Disney is in Shanghai.

Once completed, millions of Chinese will visit Shanghai Disneyland for a quintessential American experience, but also with a few Chinese characteristics.

I’ve had the opportunity to visit other iconic U.S. companies based in Shanghai — including Shanghai General Motors, Ford, Pepsi, Mary Kay and others.  I’ve learned they’ve become preferred brands for increasingly wealthy Chinese consumers.

And I’ve made a point to visit Chinese firms during my Shanghai trips, to meet leaders investing in the United States.

Chinese investment in the U.S. has grown dramatically over the past decade.  The annual value of Chinese investment in the U.S. grew from $700 million in 2007 to $14 billion in 2013.  That’s a 2000 percent increase in six years.

One of the next steps we need to take together is finalizing a world class Bilateral Investment Treaty, otherwise known as a BIT.

When our leaders met in Beijing a few weeks ago, President Obama and President Xi made BIT negotiations a top priority for both our countries.  And I can tell you it came up at virtually every meeting.  It’s not just at the meetings between our presidents, but also at meetings with other top Chinese officials up and down the roster.  Both countries very much want and are working hard to get a Bilateral Investment Treaty.  And my belief is that just as the World Trade Organization membership helped leverage Chinese growth and development in trade, the Bilateral Investment Treaty can do the same to encourage and leverage investments and protect investments in both countries.

The Shanghai Pilot Free Trade Zone could be a good precursor, good forerunner for a BIT between our two countries, which as the Mayor said, will [11:49 inaudible] negative list.  We’re hoping it will be a very short negative list, and I’m hopeful and I’m going to push when I’m back in Beijing to encourage the central government to give the local government here a little more authority so that we can get that Free Trade Zone put together very quickly.

I’m also impressed with the Hong Kong-Shanghai-U.S. connection so there will be more equity purchases in both directions.  That’s a major step forward.  Thank you, Mayor, for that.

I can tell you too, both our leaders in our governments worked quite hard over the last several months to successfully conclude an information technology agreement.  Because we know if we can get that put together, U.S.-China, then other countries in Geneva, the WTO, will follow suit most likely also, all of them agree to the provisions that the United States and China agreed to.  I think that’s very important.

That agreement paves the way for the first major tariff-cutting deal in the WTO in 17 years.  An expanded IT agreement also obviously boosts productivity and growth.  It supports up to 60,000 additional U.S. jobs.

When President Obama visited China two weeks ago, he very directly affirmed that the United States welcomes the rise of a prosperous and peaceful, stable China.  We welcome it.  That’s not just rhetoric, it’s real.  A prosperous and stable China is good for America, it’s good for this region, and it’s good for business.

That’s why we worked so hard to reach the agreements that we did in Beijing between our two presidents during APEC.  Because these advances are so important and also because I think both our countries realize that maybe we’re turning the corner here.  We’re at a potential tipping point where we can work even more closely together and stronger, to work to build a stronger partnership, even stronger than we now have.  I sense there’s a real possibility that that tipping point can be reached very quickly.

A good example is our two countries’ historic announcement on carbon emissions targets, and setting a firm date when each country will, in China, limit its use of carbon emissions, and a very strong goal by the United States in further reducing target emissions to address climate change.

I don’t think all of us, certainly not many people in the world, totally appreciate the historic nature of that agreement.  It’s phenomenal, that agreement between the United States and China.  It’s the first time in history that China’s agreed to specific targets on carbon emissions, and the first time the United States has agreed to cut its emissions by an even more significant degree.  When our two countries together led to reach that agreement — I think we’re going to look back in history and see that agreement as a major accomplishment in our bilateral relationship.

There’s such an economic opportunity for American business as we work to address solutions to climate change.  The U.S. and China are already working together on clean energy.

Through initiatives like the Clean Energy Research Center in China, the Texas Clan Energy Project, with both of those and others we’re advancing technology that will result in net-zero energy buildings and electric vehicles.

For example, when I toured the new Shanghai Tower, the second tallest building in the world, I learned that United States architecture firm Gensler designed this building to feature the latest sustainable energy efficient technologies.  These developments will also help the city of Shanghai meet low carbon economic growth which it has pledged to attain.  And I visited Tesla, obviously a company at the forefront of electric vehicle growth in China.

To further economic growth, President Obama and President Xi also made a landmark announcement on visas that can help nearly everyone in this room. We’ve extended business and tourist visas from one to ten years.  More than four million people travel between our countries each year.  In fact the U.S. handles more visas here in China than we do in any other country in the world. Our consulate here in Shanghai processed over 450,000 visas alone this year.  With this new announcement, that number will really grow.

About 7.3 million Chinese travelers are expected to come to the U.S. by the year 2021, contributing nearly $85 billion a year to the economy and supporting up to 440,000 U.S. jobs.

And yet, despite our remarkable progress, we still have disagreements, as all countries do.  When we have disagreements we have to keep in mind that we’re all in this together.  As the Chinese like to say, “We’re in the same boat, helping each other.”  And I might say that just about eight, ten, twelve hours ago, Shi Taifeng, the Party Secretary of Suzhou, made that very same point to me.

American companies want a level playing field when doing business in China, just as Chinese companies expect the same in the United States.  We both want very strong protections of intellectual property rights that fuel our ingenuity and are vital to any nation’s competitiveness.  I was very impressed with the memorandum of understanding that Party Secretary Shi has reached with the United States with respect to greater intellectual property protection.

We need to continue to build on these areas of common interests, but getting there requires leadership from both sides.

U.S. President Teddy Roosevelt once urged Americans to “dare mighty things.”  Teddy Roosevelt’s words are just as relevant today as they were more than 100 years ago.  In fact, I doubt any of you would be in this room today if you did not dream big and dare might things.  Each and every one of you.  That’s why you’re here.  That’s what AmCham Shanghai is all about. And, frankly, it’s what I’m all about.

I too have a vision for both our countries.

I want to see a strong, confident, and prosperous China that welcomes foreign businesses.  I want to see the United States and China working together on any problem, no matter how large or small.

And that’s why the American business community has no greater friend than Max Baucus.  I’ll continue to work with American companies in China every day to expand bilateral trade and investment.

We must build a world better for Americans, a world better for Chinese, a world better for everyone.  That’s our charge.

Thank you very much.