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effective way to limit emissions while allowing economic growth to progress worldwide.

with respect to access to technology, we can distinguish among the following categories: (a) Public domain technologies, which are easily accessible if information about them is available. The vast majority of technologies useful to developing countries are public domain technologies. (b) Proprietary technologies, which are freely accessible on a voluntary basis. (c) Proprietary technologies, which are protected under patents or intellectual property rights, and which are accessible through many venues.

Technology diffusion in the private sector works quickly and efficiently where there is strong demand for products. We can expect a penetration of environmentally sound technologies as improved products and public awareness increase.

We believe the best means to transfer technology to the developing countries is through the private sector in the course of normal business transactions. There is no lack of U.S. companies able and willing to take advantage of overseas demand for their technology through a variety of means - direct sales of equipment, licensing of technology for use by foreign manufacturers; direct foreign investment, including joint ventures; and training of foreign company personnel by their u.s. business partners.

The existing U.S. Government overseas investment, insurance and export promotion programs are used to assist these private sector efforts. Technology cooperation through private sector transaction and bilateral cooperative assistance arrangements is more effective than the alternative typically proposed such as mandating transfer on noncommercial terms. Mandatory transfer provides no incentives to the transferor to offer the most useful technology and to follow up with support and training services. The export promotion programs are coordinated by the interagency Trade Promotion Coordinating Committee (TPCC), established by the President in May 1990. Eighteen executive branch agencies are on the Committee, which is chaired by the Secretary of Commerce, including: the Department of Agriculture, the Department of Commerce, the Department of Energy, the Agency for International Development, the Export-Import Bank of the United States, the Overseas Private Investment Corporation (OPIC), the Small Business Administration, and the U.S. Trade and Development Program to name just a few. The routine work of the TPCC is carried out by 12 working groups that encompass various geographic areas, industry sectors, and issues. While trade opportunities in connection with the climate change issue may develop for many goods and services, the Energy, Environment, and Infrastructure Working Group of the Committee seems a logical focal point for climate change trade promotion activities.

The upcoming reorganization of the International Trade Administration's Trade Development unit will enhance the support

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Commerce can provide to the TPCC Working Group. Trade Development will be redirecting its focus and devoting additional resources to export promotion. For example, Trade Development is organizing upcoming environmental trade missions to countries such as Hungary, Poland, Czechoslovakia, and to Asia.

other programs include international agencies such as the World Bank, which administers the Global Environmental Facility, the regional development banks and United Nations Industrial Development Organization (UNIDO). Also, a large number of u.s. state and local government agencies are involved in investment and export promotion activities, and could assist in the technology cooperation process.

But we must bear in mind that while government can assist in this process, it is the private sector, in the United States, that has developed and owns most of the technology which will be involved and it is the private sector which must be engaged if the transfer process to the developing countries is to succeed. This means that American environmental technology (both goods and services) is "transferred" by commercial means. In this sense, environmental technology encompasses an enormous number of products going far beyond the common definitions of environmental control products. For example, U.s. technology employed in food processing equipment, paper making machinery, chemical plants and refrigeration equipment employs safeguards to protect the environment in many ways. And there is growing international recognition that the private sector should play a major role in technology development and transfer.

Copies of the two studies by DRI/McGraw Hill for the Department of Commerce are being submitted for the record.

A further example of the type of work the Department of Commerce is doing is a recently published Competitive Assessment of the U.s. air pollution control industry. A copy of that study is also being submitted.

Mr. Chairman, that concludes my testimony for today. I would be pleased to answer any questions that you or other members of the Committee may have.

Figure 1 Regional Shares of Total Energy Consumption in the U.S. Manufacturing Sector in 1988

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SIC INDUSTRY GROUP 000 BTUS PER PERCENT PERCENT PERCENT CODE

DOLLAR OF OF TOTAL OF TOTAL OF VALUE

VALUE ADDED ENERGY EMPLOYMENT ADDED 29 Petroleum & Coal Products

127.0 31.2

0.6

2.0 33 Primary Metal Industries

45.9 14.0

3.8

4.5 26 Paper & Allied Products

36.7
11.5

3.2

4.5 32 Stone, Clay & Glass Products

29.5
4.7

2.7

2.7 28 Chemicals & Allied Products

22.5 21.2

4.3 10.9 24 Lumber & Wood Products

13.0
2.0

3.7

2.3 22 Textile Mill Products

10.8
1.3

3.5

2.1 20 Food & Kindred Products

7.6
4.8

7.7 10.2 30 Rubber & Misc. Plastics Products

5.6
1.2

4.5

3.7 34 Fabricated Metal Products

4.4
1.7

7.8

6.3 31 Leather & Leather Products

3.3
0.1

0.7

0.4 25 Furniture & Fixtures

3.1
0.3

2.7

1.7 37 Transportation Equipment

2.4
1.7

9.5 11.4 36 Electronic & Electric Equipment

2.2
1.1

8.3

8.2 39 Misc. Manufacturing Industries

2.2
0.2

2.0

1.5 35 Industrial Mach. & Equipment

2.0
1.4

9.9 10.2 21 Tobacco Products

1.4
0.1

0.2

1.4 23 Apparel & Other Textile Products

1.3
0.3

5.6

2.6 27 Printing & Publishing

1.3
0.1

7.8

7.5 38 Instruments & Related Products

1.3
0.6

5.1

6.0 Unallocated Admin.

6.4 All Manufacturing

12.0 100.0

100.0 100.0

Source:

DOE and Bureau of the Census

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