Press Conference U.S. Trade Representative Robert B. Zoellick and Moroccan Minister-delegate of Foreign Affairs and Cooperation Taib Fassi-Fihri Washington, DC, March 2, 2004 Zoellick: Well I would like to welcome all of you here and I=m glad you=re a good distance away so you won=t catch my virus. (laughter) I want to thank all of you for coming. President Bush and King Mohammed have spoken on a number of occasions about the very close friendship that the United States and Morocco have built over the years. It=s a friendship with a very long history that began more than two centuries ago, in 1777, when Morocco was the very first nation to recognize the sovereignty of a newly independent United States. The Treaty of Peace and Friendship between the U.S. and Morocco, negotiated in 1787, is the longest unbroken treaty relationship in U.S. history. So I want to begin by expressing on behalf of all my colleagues our deepest sympathies to the people of Morocco for the suffering and destruction of the recent earthquakes. Because at a time of trial, we want to be a good partner and a good friend. But also, therefore, I=m especially pleased today to be here with my colleague, Minister Fassi- Fihri, to announce an important milestone in the long history of friendship between our countries: because we have successfully concluded a Free Trade Agreement between Morocco and the United States. Now, when our two leaders met at the White House in April of 2002, they spoke of Morocco=s cooperation and support in the war on terrorism, but also Morocco=s regional leadership in courageously standing for tolerance, economic reform and democracy. Our leaders, and also our countries, share a vision -- that free trade will strengthen our friendship by promoting growth, development, prosperity, and security. I=ve had a chance to witness Morocco=s impressive political and economic reforms when I visited the country some two years ago that helped us begin on the trail that led to today. I was encouraged to come by my close friend and former colleague, Amb. Margaret Tutwiler, who I=m very pleased could be here with us today. This is definitely her accomplishment, too. Today, after just over a year of hard work, I think we have achieved a win-win agreement. This comprehensive free trade agreement will open markets but also help promote economic reforms. We believe it sends a powerful signal to the rest of the Middle East and North Africa that the United States is firmly committed to supporting tolerant, open, and more prosperous Muslim societies. 2 I hope that other developing nations in the Middle East and North Africa will help review the terms of this agreement; because perhaps it can be a model for how others advance their economic, trade, and investment relationships with the United States. Last year, President Bush outlined his vision to create a Middle East Free Trade Area by the year 2013. His initiative offers a pathway for nations in the region to expand and deepen their trade relationships with the United States, through approaches that are tailored with the readiness and levels of economic development of individual countries. For some -- such as Saudi Arabia, Lebanon, Algeria, and Yemen -- that means first working to get them to be members of the World Trade Organization. But to also help our countries move along a path of reform with stronger bilateral ties, we are trying to build a series of Trade and Investment Framework Agreements or TIFAs. And indeed we have signed TIFAs last month with Kuwait and Yemen, and we already have TIFAs in place with Algeria, Egypt, Tunisia, and Saudi Arabia. And indeed in the coming weeks, I am also planning to sign TIFAs with the United Arab Emirates and Qatar, as well. So we are starting to get some momentum here. For those that are most committed to openness, we will negotiate bilateral free trade agreements and that=s what we=ve done today with Morocco. We are also beginning the process of negotiating an FTA with Bahrain and indeed the negotiators are here this very week. And so we look forward to these countries joining with our other FTA partners already in the region, Israel and Jordan. Indeed, we believe that this agreement with Morocco is an important milestone in the President=s free trade initiative to try to develop a trade, growth, and development strategy for the region. Our existing FTAs with Israel and Jordan have already provided concrete results, creating hope and economic opportunity. This agreement with Morocco establishes very high standards of excellence we hope that will help set a tone for continued expansion with Morocco, through the Maghreb and also then in Bahrain, with the countries in the Persian Gulf. So it=s very important to see our agreement with Morocco not just as a single announcement, but as a vital step towards creating a mosaic of U.S. free trade agreements across the Middle East and North Africa. For the United States, the FTA with Morocco opens an $11 billion import market, with a population of some 31 million people, in a country that stands at the crossroads of Europe, North Africa and the Middle East. More than 95 percent of U.S. consumer and industrial goods products trade will enter Morocco duty-free on Day One of this agreement. This is the best market opening package of any U.S. Free Trade Agreement with any developing country. It will create new export opportunities for 3 American goods and services in key sectors, such as information technologies, construction equipment, machinery, chemicals, and many more. In doing so, it helps us level the playing field for America=s producers of consumer and industrial goods because they currently face an average tariff rate in Morocco of about 20 percent, and that compares to an average trade weighted average in the United States of about under 2 percent. The agreement covers all agricultural products and will open Morocco's market to U.S. farm products. Poultry, beef and wheat will benefit from greater access under tariff-rate quotas and frankly this will help U.S. farmers and ranchers get a new tool to compete against Canada and the EU in Morocco's markets. Tariffs on corn, sorghum, and soybeans will also be cut significantly or eliminated immediately, allowing U.S. exporters to respond to Morocco's growing interest in feed ingredients. And processed foods, nuts, and horticultural products will gain significant new market access. At the same time we try to deal sensitively with Morocco=s special needs with its small farmers. Because we believe we can protect the social stability that is important for Morocco at the same time we expand markets for American products. The United States will phase-out all agricultural tariffs under the agreement, most in fifteen years. An agricultural safeguard will be available in the event of significant price decreases for certain horticultural products. In addition to eliminating tariffs, the FTA includes commitments to open the Moroccan services sector to American businesses, including significant new opportunities for U.S. companies in telecommunications, computer and related services, tourism, energy, transport, financial services, insurance, entertainment, and others. In the area of Intellectual Property Rights, we=ve negotiated a very strong set of protections that build on the provisions of the Chile and Singapore FTAs, and at the same time they in no way undermine Morocco=s ability to use the provisions that were developed as part of the WTO to deal with problems of HIV-AIDS or other academics (pandemics) under the Access to Medicines provisions. We=ve negotiated some very gold-standard provisions on investment, e-commerce, and increased transparency in government regulation, procurement and customs administration. It will buttress Morocco=s efforts on environmental protection and labor through a commitment to fully enforce domestic labor laws. And I point out in the course of the negotiation Morocco actually developed a new labor law that will come into effect this year. Transparency and anti-corruption provisions agreed to in this agreement will also help focus on a more open and predictable business environment. Now to help Morocco meet these commitments, the U.S. will refocus some of its foreign assistance aid including not only from the State Department, EPA and AID but also from the Department of Labor to provide additional technical assistance. We will also work closely with 4 the private sector in Morocco and in the United States to fully realize the trade and investment benefits that should come from the agreement. Because we believe that one of the real benefits of this agreement will be to create a business and investment climate in Morocco that will lead to increased prosperity, economic growth and good paying jobs. Now, as we celebrate today=s accomplishment, I want to thank in particular my friend and colleague Minister Fassi-Fihri and their entire negotiating team for their very hard work. The Minister had a very challenging task. I know he had to spend a lot of time going back to Morocco to explain some of the complexities of this agreement, but time after time, with good spirit and creativity and hard work and intelligence, he proved to be a first class partner. I want to also thank Ambassador Mekouar (MEH-kwar) who could join us today because he=s done an excellent job in our country of trying to explain the changes taking place in Morocco in terms of economic and political reform.