 Good. Great. I'm Dan Rundy. I'm the Director of the U.S. Leadership and Development Program here at CSIS, and I also hold the Shriar Chair here. And we're having a conversation today about catalyzing growth, the role of the United States in global infrastructure development. I think it's obviously quite a timely conversation. What prompted us to convene this meeting was what I've been describing as a constructively provocative article in Foreign Affairs by Jose Fernandez called Bridge to Somewhere, which I hope you'll go and read if you haven't read, and many of you I suspect have read it. Jose is the former Assistant Secretary of State for Economic Energy and Business Affairs at the State Department, and he's a partner at Gibson Dunn and Crutcher and came down from New York to be with us. So thanks for taking the trip down, Jose. We just had a very thoughtful and interesting lunch discussing this issue in an off-the-record setting. I thought that was great. And then we're going to hear from my friend Lee Zack, who's from the U.S. Trade and Development Agency, and very ably leads one of the crown jewels in the U.S. government. I think it's really a great agency. So I think you have their bios in front of you, and I think we're going to have a very lively conversation. So without further ado, I'm going to ask Jose to come on up. And if he wants to speak from here, if you want to sit in the chair either way, it's fine. And then after that, I'll ask Lee to speak as well, and then three of us will have a conversation. Over to you, Jose. Great. Thank you. Wonderful to see a number of all friends and a couple of enemies. You always talk about the friends. Right, right. But I know it's great to be here. Thank you so much for inviting me, Dan, and it's good to see Lee as well as I said earlier. TDA is one of the crown jewels, I think, of the American government. And if you look at what we get for the money we spent on TDA, I think you'd have a lot more of those. So thanks for inviting me. You know, I've always been involved in infrastructure in places like Africa and Latin America, but it took a trip to the Middle East for me to start thinking in government about infrastructure. I was in Libya before the fall of Gaddafi and Tripoli looked like a construction site. You had cranes everywhere. You had Turkish companies. You had Chinese companies. You had European companies. You had Brazilian companies. You didn't have a single American infrastructure company doing business in Tripoli. I then moved on to Tunisia a little bit after the start of the Arab Spring and President Sarkozy from France was coming over and with him were a number of French infrastructure companies. They were looking to do business in Tunisia. Then I moved on because after all this was government so I traveled a lot. And I ended up in Colombia and I went to see the head of their national infrastructure agency, ANI, because President Santos of Colombia had announced a $50 billion three-year infrastructure project to build up the roads and the waterways and the airport in Colombia. And after I finished talking to this guy who I had known from before, he said to me, Jose, you are the first American of any kind that I have seen in my one year at the infrastructure agency. And that told me something. And that's really what I wrote the article about. There's an infrastructure boom that's going on around the world and this is something that should not surprise us. After all, you've had a tripling of the consumer classes or the middle classes or you will have a tripling of the middle classes and consumer classes in the next 10 years. We've seen 500 million Chinese come out of poverty. We've seen 50 million in Latin America. We now have more people in the middle class in Latin America than we have people in moderate poverty in Latin America. And that's a huge, huge change in the continent. What this means is that these consumers, these middle class citizens, they demand the same thing that bourgeois everywhere demand. Water, electricity, roads, airports, even hotels. But it's not just the new middle classes that are clamoring for this. It's also governments. I mentioned Colombia. The reason why President Santos came up with a $15 billion infrastructure plan is that he felt that after five, six years of 4%, 5% growth in Colombia, they were reaching a bottleneck. They were simply not enough roads for trade to happen, for Colombia to be competitive. They weren't enough airports. And with a new free trade agreement with the U.S., he felt that the one thing that they needed to change and improve was infrastructure. McKinsey has estimated that maintaining growth rates in the emerging markets through 2030 will require $60 trillion, trillion dollars of infrastructure investments. We've all seen it in India where the government has announced a $1 trillion infrastructure development program. 50% of that will be paid. By the private sector, 50% will be paid by the government. In the last four years alone, India has increased the number of airports from 50 to 90. And it's likely to be the world's third largest aviation market in the next five years. In Brazil, those of you who follow the World Cup have seen the results of almost $500 billion worth of infrastructure. We've got the Olympics coming on in a couple of years. That infrastructure program will continue. Mexico, President Peña Nieto not only has talked about liberalizing the energy sector in Mexico or in the telecommunications sector in Mexico, but something that really hasn't been discussed much in the U.S. The one thing that he started with was trying to remove the bottlenecks in on the border to improve the roads, to improve the airports, to try and create what he calls a North American market, an industrial market. So I could go on. I could talk about the Gulf countries. I could talk about Burma. I could talk about Indonesia. But the fact of the matter is that there's an infrastructure room going on around the world. And so then the question becomes, where are the American companies? Where are the U.S. companies participating? Well, among construction and engineering companies around the world, only one U.S. company makes the top 10, Bektel. The top, the three biggest are Chinese in 2011. All three of them, by the way, were SOEs. The rest of the top 10 are European. U.S. engineering and construction companies account for 14% of the revenues outside their home markets and infrastructure. Spanish companies, just to give you another example, we see a third of the infrastructure revenues in Latin America. My favorite factoid is that in projects that are funded by multinationals, U.S. companies rank just below, just below, more retaining companies in getting infrastructure deals in 2011. Even at the MCC, until recently, until we saw a change in the MCC recently, but in 2010, American companies were barely above Chinese companies in getting agreements from the MCC. Now, you could ask why is this an issue for government? After all, if companies don't want to invest in infrastructure around the world, that's their decision. Why are governments involved? Well, something that I think is important to remember, and I think we'll realize it if we think about it, is that U.S. companies can be our best ambassadors. They can bring transparency. They can talk about corporate governance. They will increase people to people contacts. They can also be a tool for national power, for soft power. Think of the Panama Canal. Think of Russia and the Ukraine. So why haven't U.S. companies jumped on the infrastructure bandwagon? I talked a little bit about this in the article. Number one, our projects tend to be local. Mostly state or municipal projects. Think of TVA. Think of the Port Authority. In Europe, where you have a lot more infrastructure going on, those tend to be projects that are continent-wide or tend to be in much larger markets. Our infrastructure projects are in this country in the past have been public. According to the OECD, the U.S. has the largest percentage of public projects of any OECD member. So the private sector hasn't been involved as much in infrastructure in the U.S. as in other countries. A third reason is that our companies aren't used to doing the kinds of deals that are common abroad. BOT, build, own and operate and transfer projects, turnkey projects basically mean that contractors don't just build the project and then move on. They have to build it, they have to operate it, and then after 20 or 25 years, they transfer it. A turnkey agreement means that they build it, they put together a number of the subcontractors, and then they transfer it on to the developer. That kind of an agreement, which is not as common in the U.S. as it's elsewhere, increases the risk for developers. Some of it is also history. Those of you old enough in the room to remember will remember the telecom deals that U.S. companies were involved in in the 1990s in places like Latin America will remember some of the energy deals that American companies did in places like Argentina where they ended up selling back some of these power plants back to the government for a dollar because they would much rather have the tax write off than to get the benefit of the plant. But that kind of history is still remembered in a number of boardrooms. But there's also I think, and this is what I hope we spend a little bit of time talking about. There's also a public policy issue here as well. The fact of the matter is that U.S. companies do not always compete on a level playing field. Many of their infrastructure competitors are SOEs. SOEs means that they don't pay taxes, they don't pay dividends, oftentimes they don't pay rent. These are companies that also benefit from the treatment given to quote national champions. There's a preference for local companies and many of these infrastructure projects in fact in Brazil. The government passed legislation that provided for a preference for Brazilian companies and in fact that they came in within a 25% range they were awarded the contract. The other one is that the number of the infrastructure markets, countries like Brazil, India, China, Turkey are not members of the agreement for government procurement, the GPA. These are agreements that provide for a much more transparent treatment in government procurement. In fact, China as part of its WTO accession agreed to become part of the GPA and since 2007 they have been negotiating with the U.S. to sign on to the GPA. Well that just hasn't happened and in the meantime our companies just aren't able to compete. This is why I'm so glad that TDA is taking the lead on this. Tenders in emerging markets are oftentimes based on the lowest price without anything else and that's done and you can imagine why that was done. In the number of the early tenders in the 1990s the privatization officials ended up in jail and they ended up in jail or facing corruption charges so what they ended up doing is saying well we're just going to reward the tender to the lowest bidder so as long as you came up with the lowest price you got the tender. Well that obviously works against companies that provide higher quality and so what TDA is doing and Lee will talk about it I'm sure is a life cycle cost concept that can be transparent at the same time that it incorporates issues such as quality but also U.S. companies don't get as much from our government as companies elsewhere. One of my examples while I was here in government was the Commerce Department which was doing wonderful work for the national export initiative at the same time that its budget was being slashed and so we were trying to promote exports to Africa to West Africa Francophone West Africa and it turned out that because of budget issues commerce had to move the Francophone Africa person to South Africa. The last time I heard they didn't speak French in South Africa and so this was very very difficult for the Commerce Department. So that's what Exxon Bank I won't get into that. There's plenty of experts here on the current travails of Exxon Bank but just understand that China's Exxon Bank has a portfolio that's larger than the total combined portfolio of its G7 counterparts and that Brazil's BNDS has a larger portfolio than the World Bank. Something else that I think the U.S. government needs to work on is to provide more information for our company. This was part of Secretary Clinton's economic statecraft initiative and that's why we started doing things that we need to scale up talking having conference calls regular conference calls with embassies something we call direct line creating a database of infrastructure projects around the world. We also need to find ways getting back to the to the government procurement agreement. We need to find ways to put some teeth into the GPA and to find ways to encourage to incentivize countries to join the GPA that the problem with the GPA now is that you don't see there's not much of a downside for India to not join the GPA because there aren't a lot of Indian companies that are bidding for U.S. projects here. So we need to find something where they can they can be encouraged quote unquote to join. We also need to find ways to use our chambers of commerce more. My best practice as an example is the way that the Germans do it. The Germans subsidize or pay for 50 percent of their chambers of commerce and so those chambers of commerce act as an additional commerce department officials in their in their countries. So these are all things that I talk about in the article. I'm sure that there's a couple of other ideas. I once in a while I like to talk about tight aid as a way of of encouraging of encouraging U.S. companies to get involved. I don't do that much in polite company. But I do think there are many things that we need to do because and I'll stop here unless companies our companies get on the land wagon. We will lose not just jobs at home but that infrastructure train to mix metaphors will will leave the station and at the same time it will have a strategic cost to the United States. Thank you. Thank you. Thanks. That was great. Thanks for being here. I just it was remiss in mentioning this is part of our Chevron forum series about the role of the private sector in development and I want to welcome my friends at Chevron who are watching it in San Ramon. But I think it's very fitting that this is part of our Chevron series given the the conversation that we're having. Lee the floor is yours. Thank you very much Dan. I'm delighted to be here and part of being a girl is that I have to go around that way because of high heels and put this up here because of no pockets. But I am delighted to be here and Dan is always a wonderful host and always very provides for a very provocative opportunity to discuss major issues. And I have to thank Jose for his public service and his private service. He was absolutely tremendous at the State Department and we were wonderful partners then. And I have to thank him for writing the article because that's something you can do in the private sector. And I think it really does bring a very important issue to the forefront. So I'm delighted to be here and to be talking about some of the things that you've raised. Many of you in the audience are very familiar with USDA. I see a couple of faces I don't recognize. So I'm just going to take a minute to talk about USDA. And then I want to respond to some of the things that Jose said. USDA is an independent federal government agency. And what we do is we link U.S. business to priority infrastructure projects in emerging markets. So what we do is we focus on areas where U.S. business is strong. And we link those with economic opportunities abroad. We have a dual mission. And I think that's very important to what we're talking about today. One is economic development. But the other question was raised. Why do people care in the United States about economic development? And part of that is the way that U.S. TDA helps to do business is that we help to create jobs in the United States at the same time. And we're also helping to create markets for U.S. goods abroad. So we see it as mutual benefit and an opportunity for win-win. What areas do we focus on? Again, areas where U.S. businesses are strong. So as a result, we focus on energy, transportation, telecommunications, and in certain markets, health and also agribusiness. How do we do it? Well, we're at the beginning of the process. Our bread and butter is focused on early project planning. And so we provide grant funding for feasibility studies, technical assistance, and pilot projects. And I'll talk a little bit about those in the context of Power Africa in a minute. The other thing we do is we help to bring foreign delegates to the United States to meet with U.S. businesses on specialized visits. We really do believe, and something that Jose talked about was leveling the playing field. And that's really the focus of our agency. We really do believe if people have the opportunity to meet with U.S. businesses, they get to see U.S. goods and services and action, then they're going to choose those goods and services. So that's why we bring delegates to the United States to meet with U.S. businesses on specialized visits. And at the same time, we also introduce them to some of the government officials and regulatory environment as well. So we create the right environment for those goods and services. Well, we had a little debate or chat before we began here today to talk about where we've come over the past year. And I think Jose is absolutely right with respect to the need to level the playing field and for U.S. businesses to get involved in the international development arena. But I think one of the things that I've seen is over the past year, that's happening. Now, why is that happening? And where is that happening? Part of it is because there is a whole of government approach to a part of the world, and that's Africa. Right now, with respect to President Obama's initiative on Power Africa, I have seen the U.S. government agencies working together in a way that I've never seen before. At the same time, it's an administration priority, but also Congress has introduced Electrify Africa. So we're working together as a country to support U.S. businesses. What we're doing is we're basically putting an umbrella up to be able to bring U.S. businesses into Africa, and in particular to focus on bringing power to Africa. So the President's focus is to have 10,000 megawatts in Africa and to increase access to 20 million households. How does that work? Well, U.S. today, one of the things we did is we sponsored a reverse trade mission. And when I was recently in Nigeria, I was fortunate to be in South Africa and Tanzania when the President announced Power Africa, and I was recently with Secretary Pritzker in Nigeria, and we listened to the bankers and they talked about what is needed to be able to bring a financing and to be able to bring power to Africa. They said two things. One, we need project planning, and we actually heard that from a couple of the multilateral development banks. Two, we need distribution of power, that you can develop new power, but you have to be able to distribute it. So what USTDA did is that Nigeria, as you may know, privatized its distribution companies. We brought four out of the 11 new companies to the United States to meet with U.S. businesses, because one of the things what they needed to do, and what they have to do in the future, is be able to reduce losses. So before you even get to generation, it's efficiency and conservation. Well, when these distribution companies went in and looked at the companies that they had acquired, or they're currently running for the next five years, they realized that the losses may be as much as 50 to 70%. This is exactly the thing that U.S. businesses have an answer to. One with technology, two with practices. So we brought those distribution companies to the United States to meet with U.S. businesses, and as a result, they're moving forward with some new technology to be able to help that response. They also want to do it in a mindful way, and so as a matter of fact, they came to USTDA and said, can you help with the planning? So then we're not just buying a product here and a product there, but what's the roadmap for the distribution companies? So as a matter of fact, we provided grant assistance to one of those distribution companies, Benin, and there are two others as well, and so we're doing the early project planning to be able to provide that assistance. So these are examples of how in Africa we're one leveling the playing field, providing opportunities for U.S. business, and we're also being responsive, one, to the host country needs, because what we're hearing from the host country is that we want trade, not aid. We want to work with the private sector. The other thing is we're responding to the financier's needs, focusing on early project planning, as well as meeting some of those more what some might think obscure ways to create energy or what's needed for energy. So in all of that, we're bringing the U.S. private sector as the solution. Now why do I say we're doing this in a different way? Well, in the travels over the past year, I've been doing this alongside the Secretary of Commerce, the Secretary of Energy, the Chairman of Exxon Bank, the President of OPIC. We're going with an entire package, and as a matter of fact, the overseas private investment corporation, the State Department in USTDA, actually have a program for early project planning, and these projects are from small projects that have to do with fuel cells and cell phone towers to very large solar projects in South Africa. So it's looking at the landscape and seeing how we can do this together. So I think we are providing an opportunity for U.S. businesses. We're responding, and frankly, many people said, where has the U.S. been in Africa? And we're responding to that by providing this umbrella for U.S. business. But the other thing that we've found, and Jose mentioned, and one of the trademarks of USTDA is that its ability to listen to U.S. business, and that's why I'm very much looking forward to our interaction, and also to listen to our host country partners. And one of the things we hear from U.S. business and why they're not there is the fact that many of the procurements are done on a low-cost basis. And as Jose mentioned, many of the host countries are very concerned about procurement allegations, and so they think low cost is the right answer, and the best answer. But what's happening, and frankly, I'm going to use Africa as an example, but USTDA works around the world. One of the things that's happening is that our competition came in early, and now what people are discovering is they didn't really get everything that they thought they were getting, that the infrastructure was not as strong as they had hoped for, that they didn't get the quality. So this might be the perfect time for U.S. business. How did U.S. business then get a contract or win in that low-cost environment? They don't necessarily, but they can win in an environment where you look at the best value. You take into account what's the value over the life of a project, how do you take into account maintenance costs, and frankly, this can be done in such a way that you can model it so that you can actually respond to some of these concerns with respect to corruption. So what USTDA has been doing is it developed a global procurement initiative, and we've been working around the globe, working, and as I like to say, we're working right at the tipping point, so that if people have projects that they're looking at in particular or new reforms that they want to look at this method, then we're working with them. Not just sort of blanket, this is the way you do it, but there's a real desire. And basically working to provide training, working to provide models, working to provide advisors. And as a result, we anticipate that more of these projects, large-scale as well as small-scale, will be open to US companies because they're going to be looking at more than just the low cost, but looking at the cost over time. So we were delighted, as a matter of fact, we were part of the President's Export Council on US Businesses. They responded extremely well to this, and as a matter of fact, put forward a letter to President Obama requesting additional resources to USTDA in support of USTDA for this program. And we also are partnering in this program. It's not just government to government, but we're partnering with GW Law School. So it's the academia that's with us. But the really interesting thing is almost every one of the multilaterals has agreed to be a collaborator. So even while they're looking at their own procurement opportunities and how their systems are working, they've agreed to collaborate with USTDA in this program. And as a matter of fact, we're working with them as they're trying to work through some of the reforms on their own procurement processes as well. So in response to some of the things that Jose has said, yes, it's incredibly competitive out there. It's why USTDA exists is to be able to respond to that competitiveness. But frankly, we think the best way to respond is to create a level playing field. And then US companies are going to do the rest. So thank you very much. And I look forward to a longer discussion. Great. Thank you. What do you want to say? Why don't you sit in the middle? Great. Good. Thank you both. Can I just both ask you this issue of why you've alluded to them in partial answers? And you may just want to repeat what you said. But I just want to underline this issue. Why do you think American companies are staying out? What are the things that in your mind, is it fear of corruption? Is it either language issues? What are the things in your mind that in Lee, why don't I start with you? I mean, I think one of the things is that we've had a strong economy. And there were plenty of opportunities here at home. And unlike some other countries that had to go a little further afield, you know, if you look at European countries, if they go from Washington, DC to Maine, they're exporting across the international border where we're not. So I think one of the things is we've had a very strong economy. But we also realize now it's become a global economy. So US businesses now recognize the fact that they have to go abroad. So there's been sort of some of the good opportunities at home. They're now looking abroad. I would say the other thing is, we get discouraged if we don't win. And I think that was the other thing that was going on with US businesses. When they were trying to compete, they found out that they weren't winning. And so they're not going to try again if they're not going to win. And I think that's why leveling the playing field with procurement is so important. Jose, what do you think about this issue of why companies have been staying away? I think it's fairly straightforward. It's riskier to go abroad. They just didn't think they can win. And they can't win either because they're too expensive or because they feel that there's a local preference or somehow the decks are stacked against them, which I think brings us back to what is it that we can do to try and lower the perception of risk. I mean, there's always going to be risk. But I think information, what the government can do is it can provide some information that will help you assess the risk. But at the same time, it can also work to a level of playing field. And some of the things that we have talked about. Yes, for each of you in your mind, what are the, there are, and you've alluded to different steps that have been taken. But if you could talk about what are some additional steps other than reauthorizing EXIM, which obviously there's a conversation around that right now. But what are some of the steps that the Congress could take? And what are some of the steps that the administration could take and or is taking? And I think you've described some of them Lee, I think very in detail. And thank you for that. But think about some additional things that we ought to be doing. Maybe I'll put this to you Jose first and maybe Lee, you might just respond a little bit in terms of what are some specific additional things that the US government ought to be doing based on your article based on the conversation you heard today or some of the remarks that Lee had. I'd like to see the government, the US government doing more to promote partnerships with other EPC contractors, non-US. What is EPC? Engineering procurement. Okay. Basically, engineering companies. And look, there are a number of countries where there's not much you can do to get US companies to go in. But for example, in Libya when I was there, the Turkish companies were there. There are EPC contractors from other countries that are willing to go where US companies may not be. And so one of the things that we tried to do, we didn't get very far, but I think this potential there is to try and create partnerships between local companies and US. For example, regional allied country companies, if you will. I also think that we need to do more to try and put some teeth, as I mentioned, into the global procurement agreement. There's got to be consequences for countries not signing up to that. So that's not a legislative thing. That's a diplomatic step, right? It could also be legislative as well. I mean, there is a 2% tax that's imposed on companies in the US from countries that haven't signed up to the GPA. This is getting into the wheat. That's okay. When they win contracts. The fact of the matter, though, is Indian companies don't bid for a lot of infrastructure contracts here, or Chinese companies don't bid as well. So I think you've got to find another pressure point there. How about putting foreign commercial service officers, you touched a little bit about that and your remarks in Africa. And you may, I thought your example was interesting. My understanding is I think there are two foreign commercial service officers in Africa. I think that not because of, I think there's been a decision made across administrations to place our limited people time and money on some of the larger developed markets. Is there something there? Well, look, you can always throw more people at a problem, right? And the fact of the matter is, you know, it's better than I think that's hard to do. It's hard to do in this environment. But something you can do is work with technology. And commerce, state, and a number of the other agencies have seen this, and I think they're working on it, which is to try and find websites or find ways to direct US companies into opportunities abroad. So you will see, for example, that commerce now has an infrastructure website where you can actually go in there and see what the projects are in different parts of the world. Those kinds of things, using technology to try and provide that information, having the direct line calls that were basically ambassadors, doing something that in the private sector is commonplace, which is you have a conference call hosted by the ambassador where he or she talks about opportunities in her country, just 30 minutes. And what we found, and we started this in the Middle East, what we found is that we started in some countries with 30, 40 US companies, we ended up in some countries with 400 or 500 companies. And then government officials from the local country, when they wanted to talk about their projects, would ask to be on those calls. So pretty soon you would have the Minister of Defense of Country X wanting to talk about their tender, and you would have US companies able to ask questions of that minister. Those kinds of things are things that aren't going to cost you a hell of a lot of money, but it will help our companies. When I think of agile, I think of creative, I think about TDA, I have a very high opinion of the Trade and Development Agency. Could you talk, just respond a little bit to Jose's ideas, and what in you are part of a larger interagency approaches you referenced to some of them in your remarks? What are some steps that you are taking, you've referenced some of them, but what are some additional things you could be taking when you hear Jose who suggests some of these things? What's your reaction to that? Well, I do think one of the biggest issues, and if you look at some of our counterparts in other countries, one of the issues is we basically are not funded at the same level as our counterparts. With respect to project planning in particular, if you think about every project, 3% of it is for project planning, then the funding that we currently have for US TDA is just not nearly enough. One of the things we can do is to fund at the level of the President's budget, but also to be able to respond to this, what US TDA is doing is combining with our other agencies like the State Department and Overseas Prime Investment Corporation and trying to basically work together to be able to move some projects forward to the next phase. But all of these are things that take funding to be able to do it. What's your current budget and what has the President asked for? Our current budget is 55 million, and the President for 15 asked for 68. So it's not $13 million? Right. Not a lot. So, and it could go a long way. It could go a long way. And I think Jose made a really good point about the fact that it doesn't take a lot of money. It basically takes it strategically in the right place to be able to make some of these activities move forward with agencies that are accustomed to being able to do this. But our foreign competitors are way outspending us with respect to supporting their companies and have very close relationships with their companies. When people talk about, there's a lot of discussion about the concept of corporate welfare today in Washington about some of the instruments. And so I wanted to, when people say that some of these instruments are corporate welfare, how would you both respond to that? I think that's a question we have to find better answers to. But I would just, I think from a purely mathematical point of view, I would argue, some of these agencies, you get $70 on every dollar that you spend. I think that may be 73. 73. So you're 13 million, multiply 13 million by 73. I've got to break up my calculator. My second grader could do it in his head, but I have to use a calculator. But also, I think the fact of the matter is we want to create jobs. We want to increase exports. We can't do that with our hands tied behind our back. As I said in my talk, the Chinese are spending more in their X and Bank than all the other G7 countries combined. In the infrastructure world, you could have the same technology on what's going to make a difference oftentimes as a financing. And so you've got to be able to finance. And what it means, you've got to make the link from a political point of view to how that helps exports and how that helps jobs and how having our companies go abroad is going to help America's image. And Suley, maybe I'll ask a slightly different question. You do reverse trade missions. You bring companies from Egypt and other parts of the world all over the world to the United States. And you were talking about that in your remarks. And you go to all parts of the United States. You take them to Iowa, you take them to Nebraska. So maybe you might just talk a little bit about maybe how you tie what you do to how it matters to Americans where they live. Maybe you might just speak a little bit about that. No, thank you. And I think that's exactly right. I mean, one of the things that's very important is for us to be able to get the delegates around the United States. Because what this is about, it's about jobs. It's about creating opportunities for exports, for goods and services, which are really jobs in the United States. But I think one of the things we sometimes forget is the fact that, one, USDA works with small businesses for sure. But also sometimes when you're working with a larger business, what we miss is the fact that there are small businesses that are suppliers to those large businesses. So oftentimes there are indirect exporters that aren't even aware of the fact that they're participating in globalization and in these exports. But we think it's really important to be able to bring the delegates to where the opportunities are and that's across the United States. Let me just push on something that's not very sexy, but I think you touched on it, this issue of procurement. I've written a paper about it. People start trouble sleeping at night. I recommend you read this paper we did on Strengthening Procurement Systems in Developing Countries. Lee actually read it. Thank you for reading it and liked it. And you have this very interesting initiative, which I think is actually quite, you referenced it. I think it's actually quite important. And I recommend that people, should you just talk a little bit more about what it would take to scale that up or what you'd like to see happen with that activity? Because I think this is actually quite important. No, and it's actually fascinating because of the fact that there is such a demand for this initiative around the world. And I think that is the thing that is really, one, the private sector is really, really supportive of this. They think it's one of the most important things to be able to level a paying field. And what this is about is giving governments the ability to be more sophisticated in how they buy goods and services, the capacity of governments to be more discerning in what they buy and how they buy construction products and services and things, whether computers or generators or other things. Is that a fair description of it? That's a fair description, exactly. It's basically how to be able to buy something, looking at its value, not at the lowest cost. And I think it goes very much to what Jose was talking about as well as being able to determine what is needed and to be able to do it in such a way. One of the big concerns that countries have is corruption. And they think low cost is the only way to go. To deal with this corruption issue? To deal with corruption issues. But in working with experts from academia, as well as the private sector and governments, we're able to develop models by which host countries can do procurements of those goods that you talked about in such a way that they can actually look at what the value is. Without going to jail. Without going to jail. But also being more sophisticated about how they make decisions. One of the things we're doing is we're teaching those particular procurement officers how to do it, but we're also assisting them with advisors about how to develop those models and then taking it all the way through to how to apply those models for procurement so that they can see that they can do it in such a way that they're not going to go to jail, that there's really a formula to be able to make it happen. And as a result, you're able to get U.S. goods and services where you couldn't before. Thank you. But so what do you think about, so Jose, what do you think about that initiative? You mentioned some of the, some points about procurement. What's your take on that initiative? I think it could change the game. I really do. And it's not just an opinion. If you look at what commerce did a study on this, the Department of Commerce, it showed that when you took into account quality, which basically is what we're talking about when it's life cost, life cycle cost, U.S. companies did much, much better. And all that we need, I think, this is not as hard as it seems. You've got, companies will go with this profit. And I think if you can show U.S. companies that there's an opportunity and that they have a chance to win it, I think they'll go there. And one of the ways that you will do that is by tinkering with the procurement in a way that's transparent. You can't play with the transfer. I think one of the challenges you're going to have or I'm sure you've thought about this is how do you convince counterparts abroad that you're not really doing this in order to tilt the playing field? How do you, has that come up? That's why we have academia with us. It's exactly why you choose your partners well. And GW Law School, which is one of the leading experts, is one of our partners. And they're actually doing the teaching. So it's not sort of U.S. government. And the private sector is just speaking how this might be helpful. But you're exactly right. And the other partners are the multilaterals. So to basically point out, this isn't just about the U.S., but about leveling the playing field. But exactly, that's come up. And because we are nimble and creative, that's one of those are the things we're doing. Let me just ask one other question. I'll open it up. We often grouse about our global geostrategic competitors and how they are either using different instrumentalities or different approaches. Some are our friends. Some of them are competitors. It depends on sort of the day. Could you talk a little bit about what is it, other than the German example, which is that was very interesting. Could you talk about something that you've either seen a geostrategic competitor other than Germany doing that you thought, oh, that is really good. And we ought to be lifting that for the U.S. playbook. Because I think in some ways it's an opportunity for us to up our game. And I think this is why I think you wrote the article, and we wanted to have this conversation is we want the United States to have its game. So I think sometimes imitation is the most sincere form of flattery. So could you both talk a little bit about there's something you're seeing one of our geostrategic competitors doing. Maybe you don't have to necessarily accept that characterization, but if you're seeing, how about this, if you're seeing some other country, large country in the world that has a global presence and is growing in their markets and doing a number of things. Could you talk a little bit about is there something that you think we ought to be copy pasting from somebody else or taking and learning from somebody else? I'll start with you, Jose, and then Lee. Sure, well, I mean, it's not totally sexy to talk about it now, but I thought the Turkish government did a great job. In promoting the export, you would see Prime Minister Erdogan go to Tunisia and the first of all, he would be followed by 50 or 60 business people, right, coming down the steps of the plane. And the success of his visit was not measured by how many treaties he signed. It was by how many contracts he was able to sign. So the headline from his trip back in Turkey would be, we have signed X billion of dollars over contracts in this country. That kind of... That mindset. That kind of advocacy. Well, Secretary Clinton was very keen in promoting the issue. I think it's something that we need to really do much more of. And I would tell the Turks that I always admired they just had a cheerleader in their Prime Minister. Lee? I think that's a very good example. And I think it's why, again, we're focused on bringing the whole of government of every single agency is charged with advocating on behalf of U.S. businesses. So I have to respond to that. One thing I also saw, which actually the private sector responded to, was one of the other countries basically has a center in country for businesses to go to when they're trying to develop new businesses and contracts in that host country. So they basically let them set up shop there for about six months. So you have almost a quasi incubator, sort of a regus for companies, right? Exactly. So I actually had to, I have to give the chamber in Shanghai credit because what they... U.S. chamber? U.S. chamber, because what they did is they developed a similar small business center for U.S. businesses to be able to go to then they have sort of virtual experience as well as allowing businesses to go there for a while. So I'm going to sort of working with the Amchamps. That's an example where the private sector actually responded to something that our competitors are doing. Thank you. Let's open this up. I know there's a number of thoughtful people in the room. So I want to hear from my friend back there and this woman here with the glasses. And we'll start with these two. With the turquoise, I don't know what it's called. Necklace, turquoise. I'm Rebecca Regan-Saxx from AM Global here in DC and we work with a lot of corporations that are in emerging markets, particularly in Africa. So what we hear a lot from them is that they face a lot of competition from the Chinese, which as you rightly mentioned, a lot of them are SOEs. So there's an imbalance there. But the Chinese have a very business-only mentality, I think it's fair to say, in Africa. And so they don't hire a lot of locals. They don't care that much about community relations. And I really like to say when you said that American companies could be ambassadors in a way that benefits both America and emerging markets. So I'd love to hear more about how you think U.S. companies can use good corporate citizenship and good community relations to gain a toehold in these new markets in a way that maybe our competitors can't. Let's hear my friend who's standing back there, Tom. Yeah, Tom is for it. I'm an economist. I was at the World Bank for many years. It's interesting you talk about the concept of PPPs, but you don't actually get into the contracts of them. Because I did a lot of project financing, project layout, and costing and programming up front. The bank is only finally getting into PPPs, which is really the full cycle mindset. Unfortunately, there's little discussion on what a PPP is. And the other question is, is how does the government get more instead of multiple agencies? Maybe they lessen the agency and be more concentrated, but that make it wiser. So there's not the in-concern. We're going to do three. I want to hear from this woman also in red. Good afternoon, ladies and gentlemen. My name is Rosemary Seguero. My company is Seguero International Group. I'm a U.S. based company here in Washington, D.C. What I wanted to say is about partnership with U.S. companies and local companies. The Chinese, when they go to Africa, they go right in the rural areas, looking for businesses. They don't speak English, most of them, but they'll get business there. It's us to ask U.S. companies to go and promote U.S. businesses infrastructure. Like I focus on rural electrification. I'm based here. So the infrastructure in the rural areas is not there. How do we work together? We need to promote U.S. companies in Africa. U.S. companies, U.S. services and products are very sustainable and very strong and very good more than the Chinese. So we need to explain to the local African countries that this is what the product, even if we are making it high because it's sustainable, Chinese solar panel can take two years. American solar panel can take more than 10 years. So that explanation, working with the local partners who understand the country, the people, and the customers and the wherever. So we, ourselves, we need to take that as businesses, working together U.S. companies and the local companies in countries who will bid for the projects, working with them as partners. So that's, I think, what we can do. So how do we do it? And looking at my rural electrification, how do we get our feasibility study and who can you fund us also? Thank you. Okay, so three very interesting questions. Why don't we ask, if you would just, just why don't you each respond to any and all of those? Do you want me to go first? Sure. Yeah, Jose, go first. So you ask a very good question on CSR and it's something that, you know, there's a cost to doing the right thing, right? At least a short-term cost. And I remember being, for example, in Burma, where we were the last country to lift sanctions. And at least the people that I talked to gained a huge measure of respect for the U.S., the fact that we were willing to forgo profit for our principals and the fact that we were unwilling to be in bed with a murderous regime. That, I think, leave aside, you know, going to heaven and doing the right thing. I think from a commercial point of view, it was actually the right thing to do. I think you would find that the image of the U.S. in a place like Burma was quite high. At the same time, you can't, there's only so much you can do in terms of saying that somebody else is not doing the right thing. Whenever anymore we criticize the Chinese for bringing in their workers, building shoddy infrastructure, I would say, that may be, but they're the only game in town. And if they are the only game in town, they're going to keep doing what they're doing and people are going to continue reaching out to them. So I think I have seen how doing the right thing can help, but I think at some point you have to be proactive to use that overused term and start investing, start looking for opportunities, not betting the farm, not taking unnecessary risks, but there are opportunities and there are ways to ameliorate that risk and go forward to it. Great. I think the other aspect is that getting U.S. business involved really helps to make it sustainable. And I think that's one of the really terrific things is that oftentimes when U.S. business is part of a partner, as a partner, they can accomplish some things that governments can't accomplish. They can help to force changes in rule of law because of what they show that they bring to a country. So I'm a true believer in U.S. business as an ambassador, but frankly as a game changer. And also usually U.S. business is often there to stay. They're there to partner. We have wonderful diaspora in the United States, which also can be part of that U.S. business. So I think we're there to stay in a very positive and sustainable way with U.S. business. And I think that's one of the differences that we bring. Could you both just reflect on the comments that Tom and the woman in the bright red dress made? If you could just further just elaborate on either of those comments that were made, if you would. Well, certainly on the Africa side, I think, look, I forget the numbers, but I think 70% of Africa does not have access to electricity. And there's a human side to this. And then there's a business side. There's a great opportunity there. And I think that's going to happen whether the U.S. will do it or somebody else will do it is really the challenge. And if the U.S. does not do it, then what will that do to our power, to our influence in that region? So I just think it's going to happen. The question is, will the U.S. be part of that? And I couldn't hear the PPPs. The PPPs. Well, I'll respond to both of those. One, with respect to Africa and becoming involved in Africa, clearly the Power Africa Initiative. And there's a specific website to be able to become a partner with respect to the Power Africa Initiative. But as many of you know, the U.S. is hosting a summit of African leaders. At the beginning of August. And there are going to be many events that are taking place, both from the public sector and the private sector, as an opportunity for businesses, large, small, to be able to become involved in Africa. So that's another way as well as each one of the agencies. The question before was about sort of the models and PPPs. And it's a little bit of what we discussed earlier today. And you mentioned that the model that's being used internationally is PPPs. And it's not one that's being used as much in the United States. I do think that with respect to that, I think that's true. But I think one of the benefits we have is with respect to financing. And that the U.S. actually was one of the experts with respect to project finance. And I think it's one of the tools that we actually can help to bring to the financing of these projects. But I think it's very true that U.S. businesses have not really participated in the PPP process because we haven't used it as much in the United States. What I do see now is that U.S. businesses are becoming more and more adaptable. They're getting it. And either they're recognizing, it's one of the things we're seeing in Africa, they're recognizing they have to begin to work from beginning to end, or they have to partner to be able to get there. So I see more of it happening, but I do see that as an issue. And I know that's when you raised your article. Okay, we can take two more. So we're going to take this gentleman in the purple and this woman in the red, and we're all going to agree to keep them brief. And therefore, we'll give a chance for the speakers to respond. Thank you very much for taking my question. My name is Carlos Spindoda, working as an associate infrastructure consulting firm. The first question is, I love the idea of pilots. I think that's a good way of showing companies what are the pitfalls. I have tried to work with American companies to go operate over there, and it's complicated because of many perceived risks or some of known. So pilots is definitely a good way of helping clarify some of these issues to companies. But my question was, I like the idea of the global procurement, but how do you disconnect it, disassociate it from the financing? Because the Chinese come with $2 billion and there's no procurement that you can do to alleviate this. So is there a component also on the financing, perhaps greater integration with the Ex-Bank and other agencies? Why don't we just answer this question first? I'll start. I think you're absolutely right. And again, I think it's why it's important to that the agencies are coming together, that clearly they are looking at being able to provide support for U.S. businesses from Ex-Bank and OPEC as well, and also using those funds to be able to leverage the private sector. And I know both of them, with respect to procurement opportunities, will look to see if this is something that they may be interested in and be able to provide a letter of intent. And I think that is another key. U.S. businesses are not accustomed to coming with financing. But the agencies are there to be able to support them. With respect to the terms of the financing, that I'm going to let Jose take because I know we've been chatting about it. But some of it is the U.S. are playing, we're playing by different rules than some of our competitors. And it's just we have signed up to be part of the OECD. It's the right thing to do. And we play by those rules and not everyone has acceded to those. I mean, you raise a very good point, but let's not forget also that it's not just government financing that's involved here. Something that we have in our favor is we've got a very strong private financial sector. And I think what we can do through TDA and others is make the projects attractive and then see if the private sector will participate. At some point, concessionary financing will only take you so far. And part of the challenge, I think, long term is to get the projects themselves to be much more viable, financially viable, and then you'll get the private sector. But what's happening now is oftentimes our companies are not even aware of the opportunities. And all we're trying to do is to make them aware, level the playing field somewhat, and then use some of the tools that we have. Yes, we don't have SOEs, but we do have a very strong private financial sector. And I'm going to double back on that question for one second. In addition to the private sector, the other thing is host countries actually have significant financing. And that's one of the things that USTDA has been doing is it's been working with some of the host country financiers to be able to prepare projects in such a way that they can move forward with US businesses. So taking advantage of DBSA in South Africa, for example, or working with CAF in Latin America, so basically leveraging some of the other development banks. I'm getting the hook back there, so I'm sorry I'm not going to be able to get to your question, but please join me in thanking the panelists. Thank you.