Mr. James E. Perrella's remarks

Thursday, 23 October 1997

On behalf of over 650 members of the NFTC's coalition, USA*ENGAGE and Ingersoll-Rand's 25,000 American employees, I congratulate you on your legislation establishing a deliberative governmental process for imposing unilateral sanctions against any nation. Your efforts have focused attention on the growing problem of unilateral sanctions that endanger billions of dollars in annual American exports and millions OF American jobs.

The growing recognition by all sectors of the U.S. economy that sanctions hurt the reputation of the U.S. as a reliable trading partner has prompted the growth of USA*ENGAGE and has helped build momentum to change the way sanctions are imposed. Our coalition now represents more than 650 members, including small and large businesses, leading trade associations, and agriculture groups. I am happy to note that Richard Albrecht, a former executive at Boeing and now a senior advisor on trade issues to the Boeing Commercial Airplane Group, is with us today and will be representing USA*ENGAGE at the Ways and Means hearing immediately following this press conference.

Unilateral sanctions almost never help the people we want to help and almost always fail to bring about the actions we seek to promote. Despite this dismal fact, unilateral sanctions are, increasingly, America's weapon of choice when attempting to influence the behavior of other nations. In a report issued this summer, the President's Export Council found that the United States has imposed or threatened to impose unilateral sanctions against 75 nations representing 52% of the world's population. This is an incredible statistic, especially when combined with the Institute for International Economics recent findings that in 1995 alone, sanctions cost the U.S. up to $20 billion in lost export sales and up to 250,000 export-related jobs.

When U.S. business and agriculture are restricted in trading with a country, foreign competitors are given the huge, unearned advantage of increased market share. This lost market share is difficult to regain even if sanctions are lifted. By acting alone, America practically insures that its response will be ineffective. Targeted countries can circumvent our sanctions by doing business with many, very willing international competitors.

As the CEO of a major American company with global operations, I see first-hand the impact sanctions have on our international sales, which today account for 43% of Ingersoll-Rand's total business. I, and other business executives, must regularly assure our foreign customers that we are a reliable supplier. While businesses have control over the price, quality, and availability of our products, we can not control Washington's ability to undermine our companies' reliability by imposing unilateral sanctions.

This legislation is about creating a more deliberative, disciplined process to U.S. sanctions policy. To put this in business terms, we seek a process improvement. In business, employees and management recognize that process improvement is critical for global competitiveness. We are pleased that Congress, too, is willing to improve its own processes.

With the strong leadership of Congressmen Lee Hamilton and Phil Crane, AND Senator Richard Lugar, we are taking a giant step towards bringing an end to the harmful proliferation of U.S. unilateral sanctions.

Thank you.