Big technological firms like Microsoft, Amazon, and Cisco are using more efforts by spending more on the lobbyists in pushing for the hearing of their
Big technological firms like Microsoft, Amazon, and Cisco are using more efforts by spending more on the lobbyists in pushing for the hearing of their case regarding the North American Free Trade Agreement (dubbed as NAFTA). The future of the trade deal is still uncertain as the negotiations are ongoing.
There are efforts among the trade negotiators who have already stated that they will schedule a date in the coming year to talk about revamping NAFTA. The players in the tech industry are basing their interest in the trade pact on the role it plays in the supply chain across North America and in foreign trade.
Technology companies in the year 2016 alone exported goods worth $200 billion with Mexico and Canada accounting for $43 billion and $24 billion of the total value respectively. Since 2006, export of technological goods has surged to almost 70% according to Information Technology Industry Council (ITIC). ITIC is a lobbying group whose member companies include Apple, Oracle, and Alphabet.
According to the US president Donald Trump, the NAFTA is ‘the worst trade deal ever made’ that has denied his citizen manufacturing jobs. Tech companies’ representatives oppose that the US companies will benefit from the barrier-free trading environment. According to these companies representatives, the trade pact should be updated to include key policy provisions, especially about tariffs and data storage.
According to information from Center for Responsive Politics, 28 tech companies and other industry players hired lobbyists to talk about NAFTA with the Trump administration officials or attorneys on Capitol Hill during this year’s second quarter. This is a big difference compared to 12 tech companies in the first quarter of last year which were the only effort made last year by the lobbyists.
According to what Amazon told CNBC, it has spent a total of $6.1 million to lobby and contract 11 lobbyists to negotiate trade matters including NAFTA. Microsoft has also admitted to hiring 11 lobbyists to negotiate trade matters as well and among them are ‘handful’ of them to specifically discuss on NAFTA and has spent a total of $4.5 million in the process. Cisco, on the other hand, has spent a total of $800,000 in this year alone by hiring 11 lobbyists to discuss various issues including NAFTA. Intel has also hired five lobbyists to negotiate trade issues, and the giant chip manufacturers have already spent about $1.9 million on lobbying purposes in the first two quarters. Josh Kallmer who is the senior vice president at ITI for global policy told CNBC that the stakeholders in the tech industry are encouraging the Trump administration to update few critical issues in NAFTA.
Kallmer also said that the agreement should ensure the data movement is free across the borders especially between the US, Canada, and Mexico. He added that the trade pact should forbid the policies that push the companies to localize data.
In other jurisdictions such as China, the cybersecurity policies that oblige foreign companies to partner with local firms and store the data of users within the nation have been implemented.
Besides China, Vietnam and Indonesia are other countries that have restricted the flow of data. The European Union also has restrictions. These restrictions have drawbacks such as lower flexibility of the tech firms to efficiently serve their consumers as well as increasing the cost and the threat of breaching data according to Kallmer statement his address.
Kallmer also added that tech companies want to get rid of what they are considering as excessive taxes, fees, and tariffs on their goods.
Kallmer also said that the tech companies are considering the move to locking the access to the good market.
The final date or deadline for lobbying disclosure submissions is October 20th for the third quarter.