Feb. 9 (Bloomberg) -- Trade desks at U.S. embassies in seven countries from Switzerland to Venezuela will be scrapped as the government moves employees to higher-priority markets in the biggest overhaul since President Barack Obama took office.
Officers working to promote U.S. exports in Algeria, Ecuador, Kazakhstan, Libya, Senegal, Switzerland and Venezuela will be moved to higher-priority markets such as China, Brazil, Russia, Mexico, Turkey, India and South Africa, according to the Commerce Department.
“Our goal is to ensure that U.S. companies have the support they need in markets with the greatest opportunity for U.S. exports, and where demand for our services is overwhelming,” Thomas Moore, a deputy assistant secretary with the U.S. Commerce Department’s International Trade Administration, said yesterday in an e-mail.
Seven officers and 40 local staff jobs will shift. The moves will save $6.6 million based on fiscal year 2010 costs, according to the Commerce Department.
The last comparable repositioning of the U.S. Commercial Service took place under President George W. Bush in 2007 and 2008, when personnel in consulates were moved from developed markets to faster-growing economies in Asia, Africa and South America, according to the Commerce Department. The service has staff in more than 100 U.S. cities and 75 countries helping U.S. companies get started in exporting and expanding their markets.
The embassy changes will aid Obama’s drive to double exports to $3.14 trillion by 2015 from $1.57 trillion in 2009, according to the department. The agency plans to have officers in neighboring countries provide services in the nations it’s leaving, according to a Commerce Department official, who spoke on the condition of anonymity. Some tasks may also be absorbed by economic officers who deal with issues such as business and finance laws, according to the agency.
Cutting staff in markets such as Libya will hurt the U.S., even if the trade off is adding staff in larger emerging markets, said Chuck Dittrich, vice president of regional trade initiatives at the National Foreign Trade Council and executive director of the U.S.-Libya Business Association in Washington. Opportunities for U.S. companies in Libya, which holds the largest oil reserves in Africa, are greater than ever after the ouster of leader Muammar Qaddafi in October, he said.
Return on Investment
“It’s a really bad idea,” Dittrich, who served as chief of staff to the director general of the commercial service during the George H.W. Bush administration, said in an interview. “It shouldn’t be a zero-sum game of reducing in one country to put more in another. The value of these commercial officers in a country has a huge return on the investment.”
Dittrich said the officers are often responsible for writing research on opportunities in a market, helping find distributors for American-made products and connecting U.S. companies with trade fairs where they can attract customers.
The nine offices that will be closed in nations where Commerce will keep at least one desk are in Melbourne, Australia; Vancouver, Canada; Wuhan, China; Alexandria, Egypt; Florence, Italy; Nagoya and Sapporo, Japan; Tijuana, Mexico; and Vladivostok, Russia. Also closing is a multilateral development bank office in Tunis, Tunisia.
Switzerland is the 16th-biggest U.S. export market and the largest Commerce is exiting. The U.S. exported $22 billion in goods to Switzerland last year through November, an 18 percent increase from the same period in 2010, according to data compiled by the Commerce Department. The U.S. exported $11.2 billion to Venezuela and $5.5 billion to Ecuador.
The closing will hurt business development in Ecuador, Cristian Espinosa, executive director of the Ecuadorean-American Chamber of Commerce in Quito and the country’s former chief trade negotiator with the U.S., said in a phone interview. The Chamber was notified last week that the trade desk will close in the third week of March, he said.
“We see this as an important loss,” he said.
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