 Well, welcome to CSIS. I'm Meredith Broadbent, the William M. Scholtz Chair in International Business. And our conversation today is about the US Trade and Investment Partnership Initiative in the Middle East and also the European Neighborhood Policy with the region. Where Egypt and Tunisia and the other countries in the Middle East head following the Arab Spring will have enormous impact on US and European strategic and geopolitical interests. It is important that the United States and Europe have effective tools to offer support and promote communication and cooperation and help in the development of well-functioning governments in the region. In the United States, it is expected that there'll be less funding available for foreign assistance programs. So expanding trade and investment is even more of a priority. The US Trade and Investment Partnership Initiative in the Middle East and North Africa, which the president called for in a speech on May 19, is aimed at facilitating more trade with the region, building on existing agreements to promote integration with US and European markets, and opening the door for those countries that adopt high standards of reform and trade liberalization to construct a regional trade arrangement. The European Neighborhood Policy, and that's neighborhood with a B-O-U-R instead of a B-O-R policy, as I understand it, is aimed at achieving political reform and good governance, competitiveness, and productivity of economies and socioeconomic sustainability of the development process in the Middle East and North Africa. To help us better appreciate these important programs, we're lucky to have with us today to my left Dan Malaney. He's Assistant USTR for Europe and the Middle East. As Assistant USTR for Europe and the Middle East, he oversees US trade policy towards these countries and other European trading partners in Eurasia and also countries in northern Africa. From 2006 to 2010, Dan was the senior trade representative at the US mission to the European Union in Brussels. Prior to that, he was an attorney in the USTR's general counsel's office, where he represented the United States in dispute settlement proceedings in the WTO and specialized in intellectual property rights, technical barriers to trade, sanitary and phytosanitary regulations and trade in the environment. Mr. Malaney is a native of Cincinnati, Ohio, my favorite state, and has a BA from Amherst College. To Dan's left is Hitto-Huben. He's the diplomat who heads the trade section of the European Union delegation to Washington, DC. He's participated in the multilateral trade negotiations of the Uruguay Round, China and Russia's negotiations to enter the WTO, and also the Doha Development Round. He joined European Commissioner Peter Madison cabinet, excuse me, in 2004, and later that of Baroness Ashton in 2008. From there, he witnessed the adoption of the Treaty of Lisbon. And during this period, he was also involved and he used legislative work to repair financial markets and to address the energy challenge. Hitto graduated from the Dutch University at Leiden in law and economics, and he was also a 2003 Yale World Fellow. So I'd like to welcome these two gentlemen today and have a good conversation. Thank you. Well, thank you very much, Meredith. Thank you for the invitation. Thank you for the opportunity of speaking to you today in a very sort of informal setting, I guess, a call being on a dais in front of a camera informal. As Meredith said, the president announced a trade and investment partnership initiative for the Middle East and Northern Africa on May 19, essentially made up of four components for purposes of this conversation. One is to increase trade and investment integration between the United States and the region. Second is to increase trade integration with an investment integration within the region. Third was to open the door for those countries willing to take on the necessary reforms to form a regional trade arrangement. And fourth, and maybe most significantly for the purposes of this conversation, he said that we should work with our trading partners in Europe to achieve this result. So what have we been doing under this initiative? Our first job has been to listen. We've engaged in extensive consultations with the private sector, with think tanks, with others knowledgeable, with the object of initially identifying what are the barriers to increased trade and investment in the region. And then with a list of those barriers and then prioritizing them in terms of the barriers that are the most significant, determine which tools we can undertake to try to attack those barriers. So in that context, we engaged in consultations with the private sector. We did a formal federal register notice request in September asking for comments on what we call the building block approach, this approach, where we identify areas where we can do the most good the most quickly. And solicited views as to how to pursue those. And then the next step, having identified the biggest barriers to trade and investment, is to engage one-on-one with the countries in the region. And as the president noted, starting with Tunisia and Egypt, where the stakes are highest and the need is most immediate, Libya, of course, quickly following on the heels of those two countries. But to engage on a one-on-one basis with the countries to determine what's best for them, because one of the comments or a theme to the comments that came through was that we should be talking to those in the region as partners, as leaders, and determining with them what are the most important things to do. There are a few areas that have come up both in our consultations with the private sector and in our discussions with those in the region. Things like improving the investment climate, in various respects. There's clearly a need for more investment. And there are certain things that these countries can do. As I say, different countries can do different things to encourage investment. Things from giving investor protections to a legal system to reductions of licensing fees and bureaucratic hurdles that companies have to overcome in order to invest. Second area that came up constantly was support for small and medium-sized enterprises. There is a broad recognition in some of these countries that, as in the United States and perhaps in Europe, that small and medium-sized enterprises can be a very significant engine for growth. But particularly in some of these countries in transition, there are barriers that stand in the way of small and medium-sized enterprises in terms of being able to get information on markets, in terms of being able to get financing, in terms of having the support that it takes, the infrastructure that it takes to engage in trade. Other areas included general issues of good regulatory practices, things like transparency, publishing rules for comment, public participation, things that go to, I think, the broader thread for transition in the region, which is transparency, openness. The underlying current is one of working against corruption, opening up the system, making it more available. So our overall theme has been to identify those things that can do the most good and then to work individually with the countries to achieve those. And we have, we relaunched our TIFA, our Trade and Investment Framework Agreement with Tunisia at the end of September, formed some work groups to identify in the areas identified by our consultations on investment services, trade facilitation, I forgot to mention trade facilitation actually, the general work on making it easier to have goods passed through customs, get them released early from customs, ensure that there are advanced notices of classification and basic supply chain issues that facilitate the transfer of goods across borders. So we've engaged, we relaunched our TIFA with Tunisia and identified work groups that would work in these various areas to identify specific things we can do. We've established similar work groups with our Egyptian counterparts to do the same thing. Let me shift to the fourth thing mentioned by the president, which is working with our trading partners and the European Union. It's a very interesting subject in part because we have a very good history of working with the European Union on trade and investment issues. We worked with Europe quite closely in the context of Russia's WTO accession. Over the years, we've developed a close cooperation and collaboration with other developing country markets where we share certain market access issues. But the interesting thing about working with the European Union is that, of course, we have much in common when it comes to trade and investment throughout the world. We share a lot of values. Our two economies are probably two of the most integrated economies in the world in terms of trade and investment. But one has to acknowledge, frankly, that in third countries, we're also competitors. And one also has to acknowledge that especially when it comes to the MENA region, Middle East and Northern Africa, or it's a European side called the Southern Mediterranean or the neighborhood, that there's a different history. There's a different geography. There's a different linguistic configuration with many of the countries in Northern Africa being more familiar with French and French markets and French way of doing things than American. And in terms of trade policy, the United States and the European Union are in slightly different places. And the European Union has FTAs of a sort, even if they're first generation FTAs, with virtually everybody in the region, I think, except maybe Syria and Iraq. We have FTAs, deep in comprehensive FTAs, with five countries in the region, and then trade and investment framework agreements, which are basically trade and investment cooperation with virtually everybody else. So we come at the region through a different lens. And it's probably fair to say that the first reaction of people who are students of work in this area is, well, the European Union's goal is to have the countries in the region adopt the EU-Aki, the set of regulations and standards that are applied in Europe. And anybody who's watched US-EU relations recognizes that in the area of regulations and standards, mentioned in particular things like food safety standards, there are differences between the US approach and the EU approach. So at first glance, one has to recognize that there are potentially some challenges in cooperation with the EU, because we are not only share things, but we are competitors. But I think the key, and this really, I think, goes to the theme of this conversation, the key is to cooperation is that recognizing that the US and the EU are both collaborators, share certain values, but are also competitors, the key is to identify those things, those areas that can produce significant trade and investment increases and growth and integration, the exercise that the United States is undertaking under this trade and investment partnership initiative, and find the intersect between those areas and the areas that the US and the EU don't really compete on, the areas in which we share values. And in particular, focus on those issues where the values can translate into significant increases in trade and investment. Happily, a number of the issues that we've identified as being key to increase in investment in trade are also things that, broadly speaking, the US and EU share values on. And I'll mention some sort of, as examples, because they don't want to define the universe of things that we cooperate on, but rather define, in a way, the parameters for our cooperation, those things on which we share values and share approaches and that can increase trade and investment. I can identify or suggest a few. One is the open and investment-friendly climate in countries, basic issues of transparency, predictability, rule of law, recourse for investors. These are things that can benefit US investors in the region. They can benefit local investors in the region. They can also benefit EU companies. So when it comes to, say, core investment values, it's not something that the US and the EU have significant disagreements over. Another area is in trade facilitation and improving things like supply chain, the ease with which goods can cross borders. Again, if goods can cross borders easily, they can cross borders just as easily within the region. So you can increase regional integration through this approach. They can make it easier to trade with Europe. They can make it easier to trade with the United States. It's an area I would submit that is potentially not, doesn't lean one way or the other in terms of our collaboration. Small and medium-sized enterprise support. Again, this is the kind of thing that if we can encourage small and medium-sized enterprises in the region to trade and invest, it's not something that ends up being pro-EU or pro-US, just ends up being pro-union and pro-region. And it can help everybody in the region. Other areas similarly, the broad range of good regulatory practices, let's say, public participation in the process, basic notions of transparency. It may be, and I don't mean to conclude this, but to draw this conclusion, but it may be that one might find that when it comes to the substance of particular regulations or particular standards, the US might have a different view on what those regulations or standards could be. But where we don't have a great deal of differences on basic fundamental issues of transparency, public participation. And it seems to me that those are the kinds of things you can identify the things that we can improve trade and investment and reflect values that the US and Europeans share. It seems like that can define a profitable set of areas for collaboration. One needs to ask, I think, probably the fundamental question of, well, why collaborate? Why cooperate at all? And I think the answer is suggested in part by one of the things that Meredith said in a world of dwindling resources, we and perhaps the European Union have to manage our resources carefully to the extent that we can leverage each other's resources to achieve these common goals, to achieve these shared values. It'll end up being less costly, less resource intensive for both of us. The second reason is that it's much easier, and I think our history of our collaboration in the past has borne this out. It's much easier if third countries hear the same message from the United States and from Europe and perhaps from other trading partners in the region as views on what can encourage trade and investment, because at that point, it ends up being a message about the policies that can actually increase trade and investment and not so much the policies of the United States or the policies of Europe. So we take United Front, and the message is a lot easier to deliver. So I'm going to conclude there in part to leave enough time for conversation. But I think when it comes to US and EU cooperation in the Middle East, I don't think we want to be naive and say that we're going to cooperate. We can cooperate on everything across the board, and we'll walk down the road hand in hand singing Kumbaya, because there are some different policy choices, different policy provisions. But there is quite a lot that we can collaborate on, and it makes a lot of sense for us to identify those particular things and to work on working together with our joint goals in the region. Thank you. Great. Thank you, Dan. You know, what's your perspective today? Thank you very much, Meredith and Dan. And thank you for organizing this conversation on one of the great challenges of our time. I think as Europeans, we see 1989 and 1991 as sort of seminal moments. But in equal measure, I think the events of this year will fall in the same category, and so it really is incumbent on all of the partner countries in this region to use whatever means we have to help them along in what is inevitably going to be a very difficult period of transition. I think if I could maybe start by saying, and Doris, I think what Dan said, that our starting points are very different between the EU and the US in this region, because Europeans originate from the Mediterranean. This was our sea that we shared with countries in North Africa. The British historian, Lord Norwich, has written a fantastic book called The Middle Sea of a period in which the Mediterranean was, for all intents and purposes, for us at least, this was our place, our place in which we lived, in which we traded, whether it was between Roman Carthage or the Phoenicians and the Greeks. And so we have a very long history with the region, which is saved by geography. And I think that, for example, if we now look at the region, we divide the region very much between the Mediterranean and the GCC. And for Americans who look at the region, you have the Great or Middle East. And I think you don't distinguish between the two. But we distinguish between our neighbors and we distinguish between the GCC. And for the GCC, we very much want to encourage them to operate as a single entity, as suggested by what the GCC is meant to encapsulate. And a second point, I think, is that because these countries are our neighbors, we have very complex and very multifaceted relations with them. It's not just about trade. It's also about security. It's about organized crime. It's about migration. It's about all the different links that neighbors have with each other. And so in many ways, it's something that you could compare, for example, with the US relation with Mexico. And you try to use all the different instruments that you have in order to develop the most positive relation possible. Having said that, I do think that we increasingly have similar objectives. I think we have similar constraints. And I think we have a similar analysis of what these countries would benefit from in terms of next steps that they can take. So in terms of the objectives, I think we want stable and prosperous countries there. It's maybe a platitude to say that. But I think that that is the sort of North Star on which policies should be developed. We want to help them nurture strong institutions of state in all senses, whether it's a parliament, whether it's a judiciary, whether it's the rule of law that allows the freedom of expression. And we are both, I think, aware of the challenge in these countries of managing a political and an economic transition at the same time. And doing both at the same time is something that is extremely challenging. I think we both are aware that there are constraints. We're in a difficult period in the world economy today. The resources are not unlimited. But I would argue that the packages, the financial assistance packages that have been provided so far through the Dove partnership are exceedingly generous. And I'm told that they test the sort of absorption capacity of the countries in terms of being able to offer meaningful projects for the financial means that are available. The second constraint, I think, certainly, which we see as Europeans if we compare this to Central and Eastern Europe in 1989 and 1991, is that those countries had a very clear prospect of new membership that was offered to them. And that gave them a very defined political trajectory of reforms that increased their attractiveness for investment, that led to very rapid reforms in terms of economic and regulatory frameworks. And of course, for the North African countries, they have to, in a sense, find a destiny that is very much more their own, I think, than that of Central and Eastern Europe where it was a shared destiny and of bringing them into the European group of nations. And I think that's a very important distinction to make. Now in terms of the analysis, and then I'll come a little bit to the solution, I think we both have a shared analysis in America and in Europe about the importance of strengthening the institutions of government, about the importance of making the region more attractive in investment location. And obviously the more the region is integrated, the more attractive they become as an investment hub. If you're making detergent for the region and you can't have a single factory that will supply the detergent to all the different markets, then you may come to the conclusion you might as well produce the detergent in Spain and export it to each of them from your production facility in Spain. On the other hand, if they have an integrated market, you may want to have one single facility in North Africa and serve the whole market from there. So regional integration, I think, again in terms of the analysis, we believe is very much essential to create the employment, the transfer of know-how that is important to trigger growth. And investment really is key to that. There is a weak SME structure. I think that's also part of our analysis, whether this is in Egypt or in other countries. We have to do what we can to facilitate the emergence of small business in the region. And we have to make funds available for infrastructure, whether it's telecoms, whether it's highways, whether it's ports. All those are the essential building blocks of a more prosperous growth. If I can just end by just making one comment on regional integration, our figures suggest that only 7% of trade in the region is among the partners, which is, I don't think you'll find a single region in the world that has such low intra-regional trade figures, even in Latin America with all the geographic difficulties of trading in that continent or, and certainly in the Asian region, you see inter-regional percentages, which are in the order of 30%. So this very low regional integration component is a clear drag on the growth of the region. And you can have all the highways and you can have everything in place. But if there isn't easy customs procedures, if there isn't a framework whereby countries have the confidence that if they produce something that they can sell it in each other's markets, that is an essential transformation that I think we both wish to encourage. In our negotiations with these countries, and we have individual FTAs with them in place, we have noticed that they often felt that they scored a victory if they got their tomatoes into the European market two weeks before their neighbor. It's a very simple example. But again, it shows the mindset in which, in previous, they were thinking that they were producing exactly the same things, whether it was textiles, footwear, agricultural produce. And really going forward, you want them to move away from this competition with each other to get to our market and more to an overarching concept of what is good policy to favor growth, incoming investment, and the like. Now in terms of our interaction with the region in Europe, we have a mix of bilateral and regional instruments. So we meet the region together at ministerial level, whether it's heads of state or trade ministers or whatever, at least once a year and sometimes more often. But at the same time, we have bilateral agreements with each of the countries, except for Libya and Syria. But apart from that, for all the Mediterranean countries, we have free trade agreements in place, which cover all of the industrial goods and most of agriculture, about 80% of agriculture. But that means there's still 20% left and there's 20%. Obviously the areas where these countries have potentially significant export interests towards the European market. And this is one of those areas where we can do better. The second point I think Dan rightly mentioned that these are first-generation agreements. So they don't include the services sector. They don't include investment. They don't include chapters on competition policy, on sustainable development, and those kind of supporting areas which we believe will benefit the countries developed. And they also don't include, at this point in time yet, this strong regulatory component about identifying areas where if they adopt regulations which are similar to those of the European single market, then if they produce for their own market, they can immediately produce for ours as well because they will have met the requirements of the European Union. And bearing in mind that 40% of their exports go to European markets. So we are by far their largest export partner. I would argue, and I agree with some of the caveats that Dan mentioned, but in terms of good policy, I would argue it's very good policy for these countries to identify where they can simply dock into the single market rules and because that will help them export to Europe. Conversely, that will also I think help other countries because if you want to export to Libya in 10 years time and Libya has in a certain sector European standards, well, you're likely to be exporting to European destinations in the same time so you don't have to then comply with Libyan standards which might be different. So in a sense, I don't always share this idea that if countries adopt European regulations that that would not be in the interest of American or other competing producers. I would strongly argue that it actually is in their interest because they're all exporting to Europe as well and it will just enable them to do the same to do the same with those markets. Now what is true is that in our relations with the North African countries, they do still exist through a hub and spoke system so we have bilateral agreements with them and we don't have a regional agreement and I think that this is one of the great, I would almost say visionary aspects of President Obama's speech in April is that he did sort of put as a poll star this concept that if the region is able to work together and to create a single entity for the purposes of trade policy that that will really benefit their growth. Of course we would say that as Europeans because that's who we are but I think there are enough demonstrations elsewhere in the world that if you have a small domestic economy like Libya for example or Tunisia then you have a significant interest in doing certain things together. It also leads to more stable policy because you don't usually change it without coordinating with your other partner countries and by extension it always leads to more transparency because you have to go through these mechanisms of consultation with other countries so generally it leads to more transparency and more stability which I think is much in our interest. Just a couple of final words. We have in reaction to the events of this year and subsequent decisions that European leaders have taken submitted as European Commission to our member states mandates for new negotiations with Egypt, with Morocco, Tunisia and Jordan and I would anticipate that Libya will follow shortly next year. The idea being that we want to complete the FTAs by making them go beyond the first generation of the existing agreements and we are prepared to take difficult decisions in agriculture and elsewhere to make that happen. We hope to have those mandates adopted by the end of this year subsequent to which in 2012 those countries will be invited to express their interest in the level of ambition and in the speed at which they wish to proceed and I think it's no secret that we expect the Moroccans to be the first out of the box very quickly because they usually are closely followed by the Tunisians and so these are I think aspects of which we are with which we are very familiar. I might say a last word about the GCC because I'd be remiss if I didn't mention that that is again a very important partner for us for many reasons both economic and non-economic. We very much hope that this which I think is the longest ongoing free trade agreement negotiation that the EU is involved in I believe. It's been going on I think for at least I think 30 years but at some point we will be able to bring that to a successful conclusion and there I think the same applies as with North Africa that if we can encourage the regional component we believe that that would be very beneficial for the countries themselves. In conclusion I think that what Dan has said in his first sentence is something I very much Dan is much wiser than I am because I'm Dutch so I always sort of say things before it comes out of my mouth before I sort of process it but Dan does this much more carefully and I think the listening component and reacting to what the countries themselves wish in terms of the speed, in terms of the level, in terms of the intensity and this especially applies to Egypt I think. I think American our American friends feel this very acutely which is I think why you're treading very carefully in this next chapter but having said that I think we can say that we're maybe in the past for this region the glass was half empty for many of us it's now half full and that our ambition for the region must be to travel with them as quickly as they can and wish in order to bring it to the full promise to which they have now expressed an aspiration. Great, thank you very much. Just to put a focus on the integration theme of trying to increase integration of trade amongst the countries in the region that the 7% figure that you mentioned Hiddo is really astounding. Is there concretely what can we do beyond customs facilitation? What do you see the customs facilitation in terms of increasing movement in and out of borders is step number one of course but where do you see concretely this objective being executed? Are there other things that we can do that will increase trade integration in the region? Well I think integration in the region is a particularly interesting area because the European Union has had a long experience as Hiddo was reciting of trying to encourage this regional integration through the Barcelona process and others and clearly some creative thinking is needed because we find ourselves many years after the attempts were made to improve regional integration, it's not a new issue still saying things like combined exports is equal to Sweden, you know. So I think if the issue is that as far as goods are concerned the countries make some of the same product so they don't really have the different comparative advantages that allows them to exchange, that's the kind of thing that would happen with economic development and growth and investment you would naturally diversify. I'm not sure that that is the case, I've heard things on both sides where the people have commented on us whether the goods are complimentary or not but it does suggest and this is some of the people who commented to us in response to our federal register note has suggested that this maybe suggests that you look toward some of the more intangible trade trade things into services, information communications technology, more of the human capital exchanges could be a focus that could lead to increased integration. I think beyond the basic trade facilitation meaning how you process goods at the border various supply chain issues I think would be helpful basic transportation issues but I also think that beyond trade facilitation having a transparent regime and a regime that permits public participation and a certain degree of predictability across the board in areas beyond trade facilitation could also help also help integration some of the views I've heard have been that it's the inability of the countries to meet each other's regulatory requirements that have been one of the barriers to the extent that that is a significant barrier I think by making the process more transparent and more participatory one could encourage integration in that way. I think the integration component is very instructive because the EU has had a long history of through these FTAs and through various approaches of rules of origin and cross-cumulation and diagonal cumulation has made a number of different attempts at improving integration. I think we can probably learn from each other especially in that area as to what works and what doesn't and where we should be focusing our efforts and where we shouldn't. I think very briefly I mean I make three very brief points I think the I think the political iteration is very important and in that sense I think 10 years ago two administrations ago the policy of the US vis-a-vis the region was to pursue individual FTAs. This translates into the FTA with Jordan, with Morocco, with Oman and by Iran I believe and the idea in that period was well we'll pursue these and then at some point other things will come together and then we'll have the regional benefits in a second stage. And I think what is at least what we perceive as being a step change is that now in the narrative the political narrative coming from the present coming from the very high levels of government in the US is that you are very clearly identifying this regional integration objective upfront as being essential for the country's own growth and I think that is something we very much share. I think the second challenge is in the mindset of the countries themselves so they have to go beyond this mindset of getting their tomatoes into the EU market first or their t-shirts and that implies having a different concept of what growth will mean and being optimistic that despite currently producing a lot of the same products, if you allow this regional integration to happen that in five or ten years time you will actually have comparative advantage working through different parts of the economy in different countries. And the third point I think practically is that we have every interest in support in the agadio process, very explicitly pushing them forwards on that and saying how much progress can you do? Can you go beyond goods? Can you go into services? Can you go into some of the regulatory trade facilitation areas and engaging, I think, as progressively as we can on that? Well here you say we're learning from each other, communicating, we have a lot of the same goals for the region, is there any area where we could see practical collaboration? I mean where would you expect us to look for that between the EU and the EU? Or is it premature? Well it's probably premature to say what we would do together necessarily, but we have in some of the areas where we share these values and share these goals, some things we talked about today, I think at a very practical level one could promote those in the region and at a very practical level. I mean one example which might be illustrative might be indicative of what else we could do. Earlier this year in the context of the tech, the Transnac Economic Council, we agreed to principles for information communication technologies, principles of regulation which we both believe, if followed, would encourage services to grow in that sector. And they were adopted with the specific idea that this is the kind of thing that we could promote in other countries, we could show other countries that we've done, look the US and the EU model of integration is a very strong one and should be a very useful model for others in the world. And what we have done together over the past decades has worked in terms of integration, in terms of increasing trade. And so if we could point to things like information communication technologies, the regulations reflect the principles that are laid out. In this document this will encourage investment, encourage sales services in that sector. That's something we could concretely do potentially in this region. And there may be other areas. I mean, USTR has a policy of trying to encourage SMEs. And we're taking some of those efforts abroad. I think the EU has similar policies. I mean, there are some concrete things there we can do together to, as I say, leverage our resources in the area. And these are sort of potential areas. I mean, I'm actually very optimistic about how the cooperation is going, whether this is between the EU and the US or in the G8 context, in terms of assistance to make sure that programs aren't overlapping or that we focus on what is essential. I suspect that at the summit between the EU and US at the end of this month, there will be a conversation about how can we further support the reform process. I think we have a shared analysis that we have to make the economy succeed, that the economic component is going to be the bellwether of how these regions succeed in their transition, in their transformation. So we have to make sure, I think first, that the analysis is right, that the funds are available, that they are spent wisely and coherently. And so far, I think it's a pretty good performance from our side. But again, I think the destiny of these countries will be defined by what they decide and choose themselves. Sure. We have about 10 more minutes for questions. So if folks can identify themselves, I think we've got some mics going around. Please make it a short question in the back there, please. Rational Research Service. I'm just curious about the mechanics of this collaboration transatlantically. For instance, we have Ambassador Taylor in the transition office at the State Department. How often do you and your office communicate with them on the strategy and on the policy? And the same with DG Trade and your special representative Leon for the southern may. And then how often do you, does USTR and DG Trade intend to exchange information meet? Are there regular meetings proposed? Are there discussions that are going to be set up, working groups between the two organizations so that the coordination is more than just a telephone call away or something like that? And in, for instance, Mr. Millen, you mentioned you guys might have set up some working groups in Tunisia and Egypt. How often do they at all communicate with the EU's Tunisia task force on the ground there as well to make sure that the information that you're collecting and the information that they're collecting is being exchanged and coordinated? Is it one by one or group one by one? Your choice. Tyga? Yeah, I talk with Bill Taylor fairly frequently. And with his deputy tomorrow with us and the people in the State Department in that transition office. So we have ongoing conversations about different things. And of course, I'm from the US Trade Representative's office. So we work on the trade and investment initiatives. His remit is broader and includes eight issues. But we coordinate quite a lot. On the, with respect to the European Union, I and my staff are in fairly regular contact with our DG trade colleagues in the region. I was, my last posting, I was a diplomat last year. I was in Brussels for four or five years and worked very closely with the DG trade colleagues on the US-ED relations and in the region. We continue that collaboration. So we have fairly ongoing conversations with DG trade on what is it that we're doing. They share what they're doing. And I think both of our, or at least speak for the United States, I think our actions I think are much more directed and benefit greatly from those conversations with DG trade. Yeah, I'd say the same. I mean, whether it is between the trade people or between the assistance people, it's very regular. And our contacts with the region are very regular as are Dan's. I mean, I sometimes try to get hold of Dan and he's not in his office because he's over there. So, and I think I was speaking to somebody in Brussels this morning who said he'd been to Algeria five times this year. So in terms of the channels of communication to identify what the priorities are, what feasible benchmarks are, where the assistance should go, I think we're really trying to do our best. I mean, I should say when High Commissioner Ashton was in Tunisia with her task force with Ambassador Leon, I was in Tunisia at the same time. Met with Hito's colleague who's posted down there and shared what we were doing and he did the same. So we're making a big effort to keep the lines of communication open. He'll come with a microphone really quick. Thanks. I'm Chuck Dietrich from the National Foreign Trade Council. In approaching these kinds of issues in the developing world and other parts of the world, we often sort of talk within the framework rather than promoting small and medium-sized enterprises, we talk about the informal versus the formal sector. One would argue that this started with the informal sector with the fruit vendor in Tunisia. Do you see a difference in sort of the programs or the way you're approaching North Africa? And is there a component that looks at how to bring the informal sector more into the formal economies of these countries? And maybe since Hito claims that he speaks before he thinks he could answer this question. Well, before I would say, well, we're trying to do this in certain countries of Europe as we speak in terms of tax revenue. I don't know. I mean, maybe what, because of what we do is really very much at the high regulatory level in terms of trade policy. And in terms of assistance programs, I'm not sure actually, I just have to beg ignorance at how targeted they are in terms of helping certain ministries bring certain parts of the economy into the open. So I actually don't know. I think in Europe a lot of people feel that, possibly feel that that's part of growth forces that once you have growth going, that then it becomes easier also to have administrative procedures in place, which are, but I certainly wouldn't say that there's any way in which we countenance this part of the economy more than other trading partners do. So I don't think that there's a sort of a culture in Europe which is easier towards the gray in trade relations. I don't think that's the case in terms of government procurement contracts or the like. One of the things that I found from talking to people in the region is that it's very difficult, for instance in Egypt, to set up a business. Lots of bureaucratic hurdles to go through. And so to the extent that one makes it easier to do business, makes it easier to set up a business, makes it easier to regularize your activities, I think the more likely you are to have people in the informal sector become part of the formal sector, which then ideally becomes a little less formal, which then ideally would increase the tax revenue. So I think the general, the kinds of things that I was talking about wanting to do in terms of both in terms of support for SNEs, but also in terms of improving the business climate, the investment climate, reducing fees, simplifying, making it easier for entrepreneurs to start legitimate businesses. I think that should help this informal sector maybe disproportionately more than those who are large established companies who can figure out how to work the existing system. So the benefits of what we're talking about may hit that sector even more than other sectors. I should mention maybe that in the new mandates that we have for these four countries, that procurement is very prominent. So there is an objective of having transparent, non-discriminatory procurement processes with appeals, possibilities, et cetera. So that would obviously benefit the objectives you've described. Kim Berger from Washington Trade Daily. I just want to do a follow up to the CRS question and sort of bring it up a notch. Is there any conversation or I wouldn't say plans, but any conversation about a high level US-EU meeting involving the region on some of these issues, which I guess we'd describe as capacity-building, or is it politically too early to embark on something like that? I mean, from my perspective, the conversations at this point between US and the EU and those in the region are at a relatively more modest level. It's not to exclude that possibility. That might well be a fair direction to go. I mean, I've had meetings, I don't know if I'm considered high level or not. I would also say I think that these issues are very demand-driven. So I think it's less for us. It really is for them to sort of engage and say, well, and if they wish to do so together, we'd be the first to say yes. Yeah, that's a very good point. Going back to the first theme, it's really not about dictating. It's more about listening and helping and being responsive to the needs of the region. Dev, get one up here. My name is Michael Staten-Gettys. I'm a researcher at Johns Hopkins and also at the World Bank. I'm curious about work to help these countries about their, or re-change their economies. When you look at structural problems, like how the sports don't work for us and the industry here was the lack of industry, what hope is there for that to actually have above the high-value export sectors and what work will be in the US to help those countries do that? And what I am looking at specifically is clean energy and desert exit, big discussion, building across the deserts, CSB sites. Is there any work working with those countries to develop green industry domestic production? Well, I know that, if I may, and I know that the World Bank, for example, has been urging us to accept that certain benchmarks that we've set in European legislation for renewable energy, that that renewable energy could be, for example, sourced in Morocco and passed through into the market in Spain. So there are, that's just one example, but I know that President Zellick was pressing that with some European commissioners just a few months ago. So there is, I think these things are being worked at from different angles. And I think you're a touch pessimistic in terms of the capacity of countries to catch up relatively quickly. I think the lesson of the last 20 years is that if countries have the right policies in place, if the workforces really wants to get ahead in life, they can catch up pretty quickly. And so, again, I think there's every reason for optimism, but we have to make sure that we bear the promise out. I think that's really the challenge. And I think part of what we're doing is trying to create an environment in which the private sector can determine what are the areas where there's a comparative advantage, where can they create the high value exports so it's not less about us deciding which sectors are the ones that the countries need to invest in and more creating an environment where the private sector, where the businesses can actually sort that out for themselves. I guess we probably, one or two, we'll do one here and then maybe up here in the front. Josh, see with the US Chamber of Commerce, question for Mr. Hubern, you mentioned that there was an effort potentially to upgrade the Euromaid agreements with Egypt and Morocco. Could you expand on that? Well, so with Egypt, Morocco, Jordan and Tunisia, the commission has submitted negotiating directives to our member states, which are currently being considered by them because they are authorizing environment as it were. And we hope that that process will be concluded by Christmas and that will mean that as of Christmas, we can engage those four countries to upgrade our current FTAs, which are goods only, as Dan said, the first generation FTAs and we want to upgrade them and then we can try to incorporate all these new aspects which are important either to increase investment or to include services trade or the sort of regulatory issues like procurement that Chuck was referring to earlier. So the idea is really, and that's why we call them deep and comprehensive free trade agreements. And these are within the context of our Euromaid policy, but they are individual agreements with individual countries. Let's see, one more question, maybe over here. My name is Ben Hancock from Inside U.S. Trade. There seems to be some amount of skepticism about the possibility for regional integration and obviously history shows that it's been a challenge and I wonder if you could tell us why there's reason to be more hopeful and also one of the ideas that I had heard put forward by some kind of think tank type people is how to maybe harmonize preference programs with the EU and U.S. and whether that would spur some kind of regional integration effort. And I wondered if that's something you all are considering at all. Thank you. I don't think I would characterize the approach to integration as skepticism as much as there's obviously a problem there, a lack of integration. I think we have to get down at a very granular level and figure out why it is the companies aren't, the countries are not trading with each other as much as their level of development would suggest. There are certain things that have been done in the past to encourage integration. It hasn't yet resulted in a desirable level of integration. So clearly you have to look at other things. So I wouldn't call it so much as skepticism as recognition that there is a challenge to be met there and the way to meet it, I think, is at a very granular level to try to identify why it is that the countries aren't trading with each other, investing with each other and then addressing those issues head on. Head on. On harmonization of preference programs, I think one of the things that we want to will likely be looking into is maybe assistance with countries taking advantage of our generalized system of preferences for the countries and the products, which that applies. It's not, I think our focus will probably be on that. It's not clear to me the level to which harmonization of that would necessarily be helpful. But anyway, I think- I want to finish up. There are harmonization. Right, right. Well, what I can mention, I think at two levels, I think at the sort of political level, a lot of obstacles to regional integration had existed, whether it was personal because President so-and-so didn't like Colonel so-and-so or Vice versa. Those conditions don't exist anymore and you could argue that in the new consolation, these countries will see each other as natural parts of the family, which is after all the aspiration of the Arab League. At the technical level, one of the areas where again, I think we do genuinely have a head start over other trading partners, is that we have bilateral FTAs with these countries, but in the context of our relations within the Mediterranean, we have, for example, rules of origin that permit these countries to accumulate with each other. So we have what we call pan-European rules of origin so that if a product starts in Tunisia and then is processed in Egypt, then it can benefit from the preference simply by accumulating and to the extent that all these countries have free access to our market, so there's no tariff or other restrictions except for a very small number of agricultural products. The combination of the absence of trade barriers with this accumulation of origin in terms of rules of origin, I think actually means that it's in place. It's in place for them. So the challenge for them is really to now get them to actually develop a manufacturing capacity which will create employment and the like because the access to our market is by virtue of trade barriers is not really the problem, at least not in the manufacturing sector. I think, as I said, some of the fundamental issues of regulation, I mean how, which regulations a country develops and how they develop them are in way two different issues. I think when it comes to issues of, say, transparency, public participation that set of issues you would call good regulatory practices, those are the kinds of things that clearly would be useful in the region without speaking to the substance of what's actually in the regulation. I think there's profitable collaboration that can be had on the broad area of transparency and public participation and good regulatory practices. Good. I think we're gonna conclude. We're running out of time here but I want to ask the audience to join me in thanking Dan and Hitto for great presentations. Thank you. Thank you.