During the speech to Congress, President Obama said he wanted to target trade promotion authority (TPA) by seeking greater foreign and reducing trade barriers for American businesses eyeing international markets.
“21st century businesses, including small businesses, need to sell more American products overseas,” said the President during his State of the Union address.
“Ninety-five percent of the world’s customers live outside our borders, and we can’t close ourselves off from those opportunities,” he added.
Tapping into a market worth $11bn and growing
The PCPC estimates that the United States currently exports in excess of $11 billion worth of cosmetics and personal care products internationally.
“Of course, any agreement that expands the opportunities for international trade will benefit manufacturers of finished products and the suppliers of ingredients to our industry,” said Francine Lamoriello, PCPC executive vice president of global affairs, speaking exclusively to Cosmetics Design.
“In particular, the Trans Pacific Partnership (TPP) is expected to result in lower tariffs on all cosmetics and personal care products, as well as ingredients, there will be rules for more transparency of regulations, and, in the area of cosmetics particularly, we are hoping to see some specific commitments that will improve the regulatory environment for our industry.”
Lamoriello believes that once the TPP is in place, it is likely to give a significant boost to the industry, but both suppliers and manufacturers will have to establish how best to take advantage of it.
Companies need to understand the export market
“As a first step, companies should understand which markets offer them the best opportunities, either because of ease of exporting - from a regulatory and trade standpoint; consumer interests and tastes; competition from local or other foreign brands,” she said.
The PCPC has been working closely with the TPA over the years, in an effort to progress the US cosmetics and personal care industry and expand the reach of its business overseas.
The comments build on President Obama’s 2011 State of the Union announcement that he intended to build on free trade agreements with Colombia, Korea and Panama, which the PCPC also applauded at the time, underlining that the move would serve to increase US cosmetic industry trade with those countries.
At the time, the PCPC identified Korea as the biggest market for US cosmetics and personal care products, representing annual trade in excess of $230m, whereas Colombia represented approximately $73m and Panama $53m.