Global trade is key to getting out of the current recession, according to the chairman and CEO of UPS, Scott Davis.
At the Detroit Economic Club's National Summit, Davis called global trade a "positive force" at a time when "we are operating without a map and without precedent."
"As many as 57 million Americans are working for companies engaged in global trade," Davis said. "One in every five manufacturing jobs is linked to exports of goods and services."
Davis said there are three imperatives that must addressed before global trade can work. They include the creation of a system of trade that is compassionate, deploying technology to reduce the friction that slows down the flow of commerce and moving immediately to rebuild transportation infrastructures.
"Trade is a major force for good, for growth and for jobs," Davis said. "The threats are from both economic turmoil and the protectionist impulses it drives. We must argue that protectionism is the worst response at the worst time. We can't let political expediency cloud global reality."
Davis also believes that countries must make a better effort to help those workers who are displaced by global trade.
"We are going to have to pay more attention to those displaced," Davis said. "I see a very encouraging step in that direction with the return of the expired Trade Adjustment Assistance Act as part of the stimulus package. With this we can reposition the American workforce and give our workers the skills to stay in the global game."
Davis also encouraged the implementation of technology to eliminate the delays that come with paper customs forms.
"Global competitive advantage means the right product at the right place, at the right time and at the right cost," he said, noting that will require the deployment of new technologies to better "see" and control goods moving around the world.
"Infrastructure of trading partners must be up to the demands that a new era of country cooperation and company connectivity will place on it," Davis said. "The U.S. is falling behind, and we're already paying a price. Our ports aren't deep enough; our inland waterway locks are functionally obsolete; our highways are jammed, and declining rail capacity is causing choke points across the country."
To address these problems, it will take years and billions of dollars, Davis said.
"The power of global trade is undeniable," he said. "It changes lives, reduces conflict and gives us the motivation and the means to address shared issues. We have to do it all and we have to do it right. The future of the global economy depends on it."
