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Government Shutdown Grounds International Trade

Posted by Kristen Rupert on Oct 9, 2013 1:44:00 PM

The federal government shutdown is having a negative impact on international trade, as US exporters and importers run into barriers related to shipments, documentation, inspections and information sources.  Many US government websites are either shut down or not being updated. 

International TradeAlthough Customs & Border Patrol (CBP), which oversees U.S. ports of entry, is up and running, trade executives are advised to check with individual ports.  The Environmental Protection Agency is essentially closed, meaning that no one is available to inspect import shipments of materials such as pesticides and related devices.  The result is that shipments may be stuck at ports or in warehouses.  The Bureau of Industry and Security (BIS) is not accepting export license applications, meaning that manufacturers of high-tech products such as semiconductors that are subject to export controls may see outgoing shipments delayed.

Closer to home, the US Department of Commerce, Commercial Service office in Boston, which provides export assistance to hundreds of Massachusetts companies, is shuttered.

One of the most popular services offered by the US Commercial Service is the Gold Key matching service, which provides companies with names of potential overseas distributors, partners, agents and sales representatives.  With the shutdown, Gold Key service is not available to exporters, meaning that companies may delay plans to enter new markets or expand current exports.  Research already underway will continue once the shutdown is over; companies set to begin a Gold Key engagement face uncertain delays.

Even state agencies in Massachusetts that provide export assistance may be affected if the shutdown continues indefinitely, because state funding is often contingent on federal funding.

On the global level, long-planned negotiations between U.S. and European Union trade professionals, scheduled for this month in Belgium, have been cancelled.  The trade deal being negotiated, known as T-TIP (Transatlantic Trade & Investment Partnership) is expected to boost economic input by billions of dollars on both sides of the Atlantic.  The scrapping of the October trade talks may negatively affect the goal of completing negotiations by December 2014.

Further information on how the shutdown is impacting individual federal agencies may be found at www.usa.gov or at agency websites.  

Topics: International Trade, Business Center

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