The U.S. government would have much greater ability to open new markets to U.S. insurance companies if Congress grants President Bush “Trade Promotion Authority,” the American Insurance Association says.
John Savercool, vice president of federal affairs with the Washington-based AIA, calls Trade Promotion Authority the “crown jewel” of all the trade bills pending before Congress.
Under TPA, previously called “fast track,” Congress would still have the authority to approve trade agreements negotiated by the administration, but could not amend them.
This is important, Savercool says, because many of Americas trading partners have been leery about entering into agreements with the United States because of the potential for Congress to change them.
Sometimes, he says, members of Congress seek changes in trade agreements over issues that are unique to their districts. This makes it more difficult for the U.S. to negotiate market-opening trade agreements, Savercool says.
TPA, he says, is thus an important tool for opening overseas markets to U.S. insurers.
Savercool notes that Bush is urging the House of Representatives to take up TPA this fall, possibly this month. The House leadership, he said, is working to find TPA language that will garner a majority.
Another trade issue pending in Congress is a trade agreement between the U.S. and Vietnam, he says. Indeed, Savercool says, the U.S.-Vietnam Trade Agreement could be up for a vote in the House shortly after the deadline for this issue.
For insurers, the agreement would begin to accelerate the process of allowing foreign insurance companies into the Vietnamese market, according to Savercool.
Currently, he says, there are no set procedures in Vietnam for approval of foreign competitors. The agreement, Savercool says, would begin a process over the next several years in which the Vietnamese market would open.
However, Savercool adds, U.S. insurers are not waiting for the agreement. AIA, he says, and its member companies have been working with the government of Vietnam to develop its insurance code. In addition, insurers are working independently to promote private insurance, he says.
Demographically, according to Savercool, Vietnam is seen as a very desirable market. There is very little private insurance now, he says, and moreover, as private business develops in Vietnam, there could be significant opportunities for insurers.
Reproduced from National Underwriter Life & Health/Financial Services Edition, September 10, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.