▶ 0:04:03The subcommittee on East Asia and the Pacific and the Subcommittee on the Middle East and North Africa will come to order. This joint hearing will examine how our agencies can help American businesses compete and win in international markets.
▶ 0:04:21We will examine the shortcomings in the current architecture of our commercial diplomacy enterprise and we will explore potential legislative reforms that this committee should consider as part of the forthcoming foreign service act reform initiative reiterating what President Trump has said repeatedly. Economic policy is foreign policy.
▶ 0:04:45I now recognize myself for an opening Again, good morning and welcome to this joint East Asia in the Pacific and Middle East and North Africa subcommittee hearing titled Helping American Businesses Win Abroad: Strengthening US Commercial Diplomacy. Commercial diplomacy is no longer a supporting function of foreign policy. It is foreign policy.
▶ 0:05:15The Trump administration has made clear that economic security is national security and that how we compete economically abroad directly shapes our strategic position in the world. This is the right time to take a hard look at whether our current approach to commercial diplomacy is fit for a purpose.
▶ 0:05:38The United States possesses strong tools to support American businesses overseas, but those tools are not always organized or deployed to maximize impact. Our current model is split across multiple agencies and unevenly implemented at our embassies and posts abroad. This can create gaps in execution, unclear lines or responsibility and missed opportunities.
▶ 0:06:07At the same time, global competition is intensifying and the demands on our commercial diplomacy system are only growing. We see this challenge most clearly in our competition with China, which deploys a highly coordinated statebacked approach to supporting its companies abroad.
▶ 0:06:28The challenge for the United States is not merely recognizing this [clears throat] reality, but ensuring our own system is structured to compete effectively. Incremental changes will not be enough. This moment calls for more fundamental and potentially disruptive thinking about how we organize and execute commercial diplomacy.
▶ 0:06:52We should be willing to question whether a structure largely unchanged for decades remains right for today's That includes examining whether consolidating commercial diplomacy functions such as by moving the foreign commercial service into department of state could improve coordination and deliver better results.
▶ 0:07:14It also means considering whether the State Department itself needs to build a strong more specialized commercial diplomacy potentially through reform of the economic officer track or the creation of a dedicated commercial diplomacy career track. Ultimately, commercial diplomacy succeeds or fails at post.
▶ 0:07:38We must ensure we have the right people with the right expertise in the right places and that they are properly empowered and incentivized to deliver results for American businesses. Structure, workforce, and incentives all matter if we are serious about helping US companies win abroad.
▶ 0:07:59Congress has taken steps to elevate commercial diplomacy, including through prior reforms focused on the role of chiefs of mission. Yet, we also have a responsibility to assess whether deeper structural changes are needed to align our resources, authorities, and personnel systems with our strategic So, today's witnesses bring valuable firsthand experience from the field.
▶ 0:08:27We look forward to hearing what is working, where the system is falling apart, and most importantly, what changes would have the greatest impact. We are interested in ideas that go beyond incremental fixes and address the underlying structure of the system If we want American businesses to win abroad, we need a new commercial diplomacy model that is coordinated and competitive,
▶ 0:08:58that may require us to rethink longstanding structures and consider bold new approaches. So, I look forward to a candid discussion on how we can get this right. The chair now recognizes the ranking member from California, Representative Barah, for a statement.
▶ 0:09:19Thank you, Chairwoman Kim, and um Chairman Lawler, Ranking Member Sherman for co-hosting today's joint hearing. And thank you to our witnesses um for testifying before the subcommittees this morning. Um, we live in an increasingly competitive global environment and it's critical that the United States fully leverages every tool at our disposal to support American workers, innovators, and entrepreneurs while advancing our strategic interests. One of the most important and overlooked tools we have is a foreign commercial service.
▶ 0:09:49The FCS is a trade promotion arm of the Department of Commerce's International Trade Administration, hosting commercial officers at US embassies and consulates overseas to promote US exports and attract foreign direct investment. It was spun off of the State Department in the 1980s and as a result FCS officers have specialized experience and training that equips them to support American businesses and create American jobs.
▶ 0:10:15The foreign commercial service has postings in more than 75 markets representing more than 92% of the world's GDP. As part of the Department of Commerce, FCS is paired with the nationwide network of more than 100 US export assistance centers. These domestic offices ensure that businesses, especially small and medium-siz um enterprises, can access global opportunities regardless of where they are located.
▶ 0:10:42Yet, despite the key role, the foreign commercial service is facing significant challenges. The president's fiscal year 2027 budget requests a decrease of 150 million for the global markets account that houses the foreign commercial service. This reduction would limit hiring, reduce overseas postings, and undermine the training and support that FCS officers require to be effective.
▶ 0:11:09Relative to both strategic competitors and allies, US commercial diplomacy remains substantially underresourced. Further reductions to the global markets account would erode US economic security as the PRC gains strategic footholds around the world. At the same time, staffing levels have already declined as a result of deferred retirements and hiring freezes.
▶ 0:11:32That means fewer experts on the ground in key markets, fewer advocates for American companies abroad, and fewer eyes and ears identifying opportunities and challenges in real time. We should be asking ourselves a simple question. In a global economy where our competitors are investing heavily in commercial diplomacy, why would the United States choose to pull back?
▶ 0:11:55Countries like China are aggressively supporting their firms overseas with coordinated government backing, financing, and market access strategies. If we fail to match that level of equipment, we risk seeding economic and strategic ground. The foreign commercial service should be at the center of our response. It should be leading efforts to promote emerging sectors like artificial intelligence.
▶ 0:12:19It should be helping American firms compete for major infrastructure and development projects financed by international institutions. And it should be playing a key role in strengthening supply chains, securing critical minerals, and reducing reliance on our strategic competitors. But to do that effectively, the service needs resources, staffing, and clear strategic direction.
▶ 0:12:42We also need to ensure that it is modernizing, leveraging digital tools, improving coordination with other agencies and strengthening communication between its oversee off overseas officers and domestic offices. When American companies succeed abroad, they reinforce our alliances, set global standards, and project American values. When they are absent, others fill the bo void.
▶ 0:13:07Today's hearing is an opportunity to take a hard look at what is working and what is not and what Congress can do to ensure that the foreign commercial service is positioned to succeed in the years ahead. Thank you. And with that, I yield
▶ 0:13:20Thank you. The chair now recognizes the chairman of the Middle East and North Africa subcommittee from New York, Representative Lawler, for an opening
▶ 0:13:29Thank you, Chairwoman Kim, for convening this important hearing. And today we examine the Department of Commerce's foreign commercial service. We will learn how the service currently functions from a workforce and management perspective and contemplate potential structural reforms to improve the current systems. Commercial diplomacy is a valuable diplomatic tool to both advance US business interests overseas and strengthen our economic security.
▶ 0:13:57Foreign service officers employed by commerce work to help advance these diplomatic pillars. specifically helping US industry compete in markets abroad and developing the relationships to attract more investment into the US. The foreign commercial service is an essential aspect of US diplomacy and it's Congress's job to ensure the service itself is structured to deliver results.
▶ 0:14:21We should be asking whether the current system, particularly within the economic cone, is producing the level of expertise needed to support US businesses abroad and whether officers are being incentivized to prioritize this work. As Congress considers broader reforms to the foreign service, commercial diplomacy needs to be part of that conversation. Whether that means strengthening the existing structure or building new capacity, the workforce cannot be overlooked.
▶ 0:14:49This also matters for how we compete globally, including whether countries that take a far more integrated approach to economic statecraft. Our effectiveness will depend on whether we are fully leveraging the people we have in the field. I'm interested in hearing from our witnesses about how these dynamics play out in practice. Where are the gaps in training, incentives, and staffing, and what changes would have the greatest impact?
▶ 0:15:15At the end of the day, if we are serious about strengthening commercial diplomacy, we need to ensure the State Department is rightly prioritizing this mission. I thank you and look forward to hearing from our witnesses.
▶ 0:15:28The chair now recognizes the ranking member of the Middle East and North Africa subcommittee from California, Representative Sherman. You are now recognized for your opening statement.
▶ 0:15:39Thank you so much for having this hearing. It is a topic of some But I wonder whether especially our subcommittee, the Middle East subcommittee, could perhaps focus on something that most people think is of greater importance, the war in Iran. We've not had meaningful hearings on the war of Iran since it started on February 28th. And we haven't had a government witness come before us and explain what is our foreign policy.
▶ 0:16:10And I uh to to have hearing after hearing at the full committee and in the Middle East subcommittee uh on other topics uh today reforming commercial diplomacy is not a reason to fail to have Congress be a co-equal branch of government in determining this critical foreign policy issue.
▶ 0:16:35It is time for the full committee and the subcommittee to demand and if need be subpoena government witnesses to tell us about the war in Iran. Uh as to commercial uh one issue that is rarely talked about is the extent to which our commercial diplomacy efforts can be influenced uh by corruption and campaign Imagine you have two companies, say Ford and Chevy, both trying to export to this or that country.
▶ 0:17:05which one will see its products pushed and whi which uh uh where will our uh commercial diplomacy lie? Uh we have to take steps and I'll be asking our witnesses about this to make sure that it isn't Chevy because they gave a million dollars to the comp to the party in power rather than Ford that uh uh backed the other party.
▶ 0:17:32Um we also I look at our commercial diplomacy and so often it is not job oriented it is profit oriented and it is designed to facilitate the supply chain of importers. The analysis cannot be uh which commercial policy will most increase profits of American companies.
▶ 0:17:59It has to be which commercial policies will increase wages in the United States. And uh for uh all too often I hear words like facilitate supply chains as cover for helping reduce manufacturing employment in the United States while increasing profits. Um, we've seen uh the uh budget request uh for the commercial service cut by 30%.
▶ 0:18:30Perhaps the one thing Americans want our foreign polic foreign policy establishment to do is to uh improve the economy of the United States and yet this agency is being cut by 30%. Um it is interesting to see whether the agency should be part of the state department or part of the department of commerce.
▶ 0:18:52Clearly there's expertise in the agency that exists now and clearly the existing bureaucracy uh and its fans want to leave things exactly as they are now. But it is important that the um diplomatic power of the United States be available to promote our commercial interests.
▶ 0:19:14And if uh foreign governments pay attention to our state department knowing that our defense department is right around the corner, uh one wonders will they pay attention on the commercial side. Those uh uh in the bureaucracy carrying out our foreign policy tend not to grow up with an interest in business and an interest in uh uh increasing business activity.
▶ 0:19:42They tend to grow up studying the great uh uh uh diplomatic achievements or lack thereof at Versailles at all the most famous diplomatic uh encounters in the world. Um we need to hire capable people with a real interest in business.
▶ 0:20:03And finally, let me point out that perhaps the worst part of our foreign policy when it comes to uh business is an incredibly slow process of issuing visas. I think all of us have gotten the call so and so's one needs to come. They're going to buy our product. They're going to invest in our comp company and they can't get a visa. They can't get an interview. It's not a matter of whether they'll get it.
▶ 0:20:31They'll get it eventually, but business can't wait a year and a half for a file to rise on a bureaucrat's desk. Visas are an important part of our commerce. I yield back. Are you back?
▶ 0:20:47Thank you. Other members of the committee are reminded that opening statements may be submitted for the record and we are pleased to have a distinguished panel of witnesses before us today on this very important topic. Mr. Jim Goolson, the vice president of the center for corporate diplomacy at the Meridian International Center, Miss Christina Ashi, the senior advisor at Edge Partners, and Mr.
▶ 0:21:12Arun Vancar Ramen, a partner at Coington and Berling Burlington LLP. Uh, this committee recognizes the importance of the issues before us and is grateful to have you here to speak with us today. Your full statements will be made part of the record and I'll ask each of you to keep your spoken remarks to five minutes in order to allow time for member questions. And I now recognize Mr. Gordon for an opening statement.
▶ 0:21:46Madame Chairwoman Kim, uh, Chairman Lawler, Ranking Member Barra, thank you so much Ranking Member Sherman for the invitation to to uh have this conversation today as we celebrate our nation's 250th anniversary this year. I think it's appropriate to reflect on Benjamin Joy. Mr. Joy was appointed by President George Washington in 1792 to be our country's first council to India.
▶ 0:22:08He arrived in Kolkata in 1794 and was our nation's first commercial diplomat as he established commercial relations between our young nation and India. His courageous example inspired me and countless thousands of other foreign commercial service officers to serve as commercial diplomats around the world since that time. To [clears throat] this day, there's an award given to the State Department and commercial service officers who excel in collaboration named after Benjamin Joy as a testament to the real impact our commercial diplomats make in the modern world.
▶ 0:22:39Just as the world has changed dramatically since George Washington's time, so has the world changed since the foreign commercial service was removed from the State Department in 1980. My hope is that this hearing gives us the opportunity to reimagine the role of commercial diplomacy in the modern world and to prepare our country to compete globally. In order to do so, we must update the architecture of governmental commercial diplomacy, tighten coordination and the user interface with the private sector and set us up effectively to compete with our strategic competitors.
▶ 0:23:08At the same time, we must lift up small business exporters and embrace critical and emerging technologies. This will require challenging past assumptions, empowering our existing diplomats, and recruiting diplomats based on updated criteria. It will also require understanding how internal and self-imposed funding demands have evolved over the past 20 25 years that have had unintended consequences of holding back our commercial diplom diplomacy efforts globally.
▶ 0:23:36My written statement includes my recommendations, but I believe we all have to be cleareyed that it will not be easy to change the status quo. But I firmly believe that it is urgent that we seize this moment to embrace change and partnership with the private sector to set our country up for success in the years to come. Finally, I don't think we change by trying to emulate our strategic competitors, but rather by embracing the inherent strength of our private sector and the entrepreneurial nature of our country.
▶ 0:24:01The world is eager to engage with our innovators and I'm confident our government and diplomats can be that bridge in the modern world. Thank you.
▶ 0:24:08Thank you, Mr. Bson. I now recognize Miss Shaki for an opening statement.
▶ 0:24:14Thank you, Madam Chairwoman, Mr. Chairwoman, uh, ranking members, and distinguished members of the subcommittees. Thank you for the opportunity to appear before you today. I built my career with the US and foreign commercial service from an entry- level trade specialist covering South Asia to senior assignments across Asia, the Middle East, and Europe to my final role overseeing commercial operations across 15 US embassies from Canada to Argentina.
▶ 0:24:40I'm here today because I believe this organization is one of America's most effective and least known economic tools, and because the moment to act on its behalf is now. Commercial diplomacy is often understood in terms of advancing US trade policy, breaking down barriers for American companies doing business internationally, and advocating for US solutions and foreign government procurement.
▶ 0:25:04I should know I helped author and deliver a course on the subject and that work is vital for American companies to compete and win in today's global marketplace. But the US and foreign commercial service is so much more. I ask this committee uh to broaden that definition and embrace the full scope of work being done by the men and women of this organization.
▶ 0:25:28Commercial diplomacy is also the work of helping American companies find customers in new markets and attracting foreign investment that creates jobs in American communities. It is the work that sustains American businesses and American workers every day and it deserves to be a part of this In 2010, at the height of the Great Recession, I was working out of the US Export Assistance Center in San Francisco, helping an Algerian trade delegation make connections at the World of Concrete Trade Show.
▶ 0:25:57I stopped to speak with the owner of a small company from North Carolina, a manufacturer of machines that produce concrete curves. His company had worked with the commercial service to develop export markets before the recession hit. When I asked him how things were going, he told me those export sales had saved his company. When American contractors stopped buying, his foreign customers kept ordering. The commercial service had helped him build that market and that market kept his employees working. That story is not exceptional.
▶ 0:26:28It's illustrative of the daily work being done by my foreigner colleagues. In fiscal year 2023, the US and Foreign Commercial Service assisted more than 33,000 US export clients and more than 10,000 companies exploring investment in the United States. 81% of those export clients were small and medium-sized businesses. 90% achieved their objectives. These numbers are not estimates. They are tracked transaction by transaction because accountability is built into the work from the beginning.
▶ 0:26:58But here's the challenge. The US and foreign commercial service has operated under chronic funding constraints for nearly my entire career. Today, the entire officer corps is smaller than a single A100 incoming class at the State Department. The people responsible for supporting American exporters and attracting foreign investment across more than 70 markets worldwide would fit inside one entrylevel orientation cohort.
▶ 0:27:24Over the past year, the organization has lost experience officers and staff at a significant rate. I am one among those that left. That loss of institutional knowledge and expertise is real and has consequences for American businesses trying to compete in a world that is not waiting for us to get organized. The US and foreign commercial service deserves to be funded at the strategic asset it is. The return on investment is documented. The mission is clear.
▶ 0:27:51But after years of watching budgets that kept the service functional without making it exceptional, I've come to believe that the most realistic path to a better resourced, better positioned commercial diplomacy enterprise runs through the Department of State. State has the global reach, the diplomatic standing, and the institutional resources the commercial service has never had.
▶ 0:28:11With commercial officers embedded across state's full global network, export assistance and investment promotion could reach every embassy, including markets where American businesses currently have no one on their corner. The culture, the entrepreneurial spirit must be protected though in any transition. The goal is not to absorb the commercial service into state structure. The goal is to build something better than either institution has achieved alone.
▶ 0:28:37Combining state's global platform with the commercial service proven ability to deliver results for American business. The US and foreign commercial service is critical in the fight for economic security. With the right structure, the right resources, and the right mandate, it can do even more for American businesses and American workers under the umbrella of the State Department. Thank you, and I look forward to your questions and the discussion.
▶ 0:29:00Thank you, Miss Shy. I now recognize Mr. Bank Kataran for an opening statement.
▶ 0:29:07Good morning, Chairwoman Kim, Chairman Lawler, Ranking Members Bar and Chairman Sherman, members of the subcommittees, thank you for the opportunity to appear before you today to discuss how to strengthen US commercial diplomacy.
▶ 0:29:23Your decision to hold this hearing and tackle this issue is a testament to your leadership and underscores the unique role Congress can play in ensuring that US commercial diplomacy institutions meet our growing economic security needs.
▶ 0:29:38I'm honored to share with you a summary of the thoughts that I've conveyed in my written The history of the modern foreign commercial service begins with the Carter administration's decision at the direction of Congress in 1979 to better prioritize and advance US commercial interests by transferring the function of commercial diplomacy from the State Department to the Commerce Department.
▶ 0:30:01Following a strategic review the Commerce Department undertook in the early 1990s, the US and foreign commercial service has been helping US companies, especially small and medium-siz enterprises, become exporters, building a strong track record of success in supporting entrepreneurship and jobs in communities across America, including in many of your districts.
▶ 0:30:24Central to this success was the congressionally directed separation of core commercial diplomacy from the State Department foreign service function. This separation has allowed FCS officers to advance American commercial interests abroad among other things by drawing on the strengths of the Commerce Department like the deep sectoral and supply chain expertise in the international trade administration, the practical innovation knowledge of the US patent
▶ 0:30:54and trademark office and the ability to shape business legal frameworks through the commercial law development program. At the same time, we should be clear that separation has not meant isolation. To the contrary, the commerce department and state department have deep and solid coordination and partnership in Washington and especially in overseas posts that well serves US foreign, economic, and commercial interests.
▶ 0:31:21The bottom line is that this distinctness of a foreign service agency dedicated to commercial diplomacy and housed in a department charged with a commercial mission remains a strong foundation on which Congress can and should build a revitalized and fully resourced team of commercial diplomats. Ideally, this would include improvements in the three areas of agency mission, personnel, and congressional engagement.
▶ 0:31:49On the first point, commerce needs to reorient the mission of the commercial service around economic security more broadly rather than purely export promotion. Economic security cannot be achieved without an elevated role for the advocacy center and select USA to ensure that our companies win more foreign procurements including in areas like critical minerals and bring more investment and jobs to the United States.
▶ 0:32:15Both programs need to be codified in statute and fully incorporated into the mission of the commercial service. And while it is natural here to focus on the work of the foreign commercial service, we must not forget that their success depends also on the robust US network of commercial service officers tied directly to local businesses and innovators.
▶ 0:32:36Advancing the economic security objective in a rapidly changing commercial and technology landscape also requires adaptable well-trained personnel in the right locations around the world. Most important here is the need to correct the longtime understaffing of the foreign commercial service where we essentially have the same number of officers we did 40 years ago.
▶ 0:32:57While competitors like China have long surpassed us and are beating us at our own game with multiples of the officers we deploy, and they do so with a footprint in the most critical locations all around the world, leaving no region unsupported, something this committee has well recognized as a shortcoming of recent FCS operations. Finally, Congress needs to play a greater role to invest fully in the success of commercial diplomacy and to hold those efforts accountable to make sure they are succeeding.
▶ 0:33:27More regular reporting from and engagement with the global markets business unit responsible for commercial diplomacy in the commerce department can better ensure the Congress's expectations, those from 1979 as well as 2026 are fully met.
▶ 0:33:42I want to close by assuring the subcommittee that my recommendations in no way take away from my confidence in our commercial diplomats who are some of the finest professionals in the federal government driven by a clear mission to support US business and delivering results with measurable metrics. The reasons for grounding US commercial diplomacy in the commerce department rather than the state department are even stronger today than they were when the FCS was created over 40 years ago.
▶ 0:34:09What is needed is not a new home for the foreign commercial service, but a redefined mission and resources for them to do their job effectively on behalf of the American people. Thank you.
▶ 0:34:22Thank you for all of your opening statements. I'd like to now recognize the subcommittee chairman uh Mike Lawler on the Middle East and North Africa for his uh uh five minutes of questioning.
▶ 0:34:36Thank you, Madam Chair. The Foreign Service Act has not been comprehensively updated since 1980. Despite significant changes in the global economic landscape as commercial diplomacy becomes more central to US foreign policy, questions remain about whether the foreign services culture and incentives reflect that shift. Aligning mission and incentives will be key to modernization.
▶ 0:34:59Does the current incentive structure reflect the growing importance of commercial dis uh diplomacy as a core mission? And should Congress consider updating the Foreign Service Act to more explicitly prioritize support for US businesses, including small and medium-siz entrepreneurs?
▶ 0:35:21Thank you for the question. I think the the answer to the last part is is yes. I think the authorities uh should be updated to reflect the realities of the global economy today. I think the incentive structure within the foreign commercial service is present and certainly there's interest across the inter agency to play a role but the question is can we play that role in a coordinated well-resourced way. I think that's a very very much an open
▶ 0:35:45And how could performance evaluations and promotion criteria be reform to ensure officers are rewarded for delivering tangible commercial outcomes for American companies?
▶ 0:36:01um the foreign commercial service uh currently has a system of uh KPIs key performance indicators that we are measured against. Um, State Department doesn't have anything to my knowledge that is similar. Um, we report on every company that we service, every service that we've done, the company's uh, satisfaction levels. Those are all very well documented um, and leverages into our performance evaluations as officers.
▶ 0:36:28A statement department could emulate that or adopt it as part of the commercial service. Mr. Mr. Chairman, if I may, I think uh I want to second uh what Christina said about the key performance indicators and that is something um all officers work towards um and is fully documented. What is missing, however, is um a broadening of those performance indicators to reflect the full scope of the work necessary to advance American economic security.
▶ 0:36:57And that's where I think uh this committee and other members of Congress uh can really take a role in redefining that mission so that those performance indicators uh capture the full uh range of duties and outcomes that we expect commercial officers to
▶ 0:37:12Now commercial diplomacy today requires specialized skills that go beyond traditional diplomatic training. As the mission evolves, training and professional development must keep pace. Uh what does the current training look like to prepare foreign service officers to support US businesses in competitive global markets and is there any required training focused on commercial diplomacy and private sector engagement?
▶ 0:37:41Um yes and I think this question is directly tied to resources. I think the the official professional development uh resources have been frozen for some time. As my colleague Christina has said, the workforce itself is quite entrepreneurial and finds online courses, but could it be improved? Uh, 100%. Uh, officers find their training through private sector sources and and open sources. Uh, but resources would be required in order to give officers the opportunity for that professional engagement in commercial diplomacy.
▶ 0:38:13Congress has taken steps to elevate commercial diplomacy as a priority, including reinforcing the role of chiefs of mission. Uh, however, implementation may vary across posts. As part of modernization efforts, Congress may need to revisit how accountability is structured within the foreign service. How can Congress better ensure consistent implementation of commercial priorities across posts rather than relying on individual leadership styles?
▶ 0:38:44I will say uh Mr. Chairman in my recent experience as a foreign commercial service officer ambassadors universally have been deeply interested in that work. I think to answer your question directly the performance management of chief of missions should include a corporate diplomacy element. I think that would be helpful but in practice uh they have been uh side by side with commercial service officers in my
▶ 0:39:07and uh the global distribution of foreign service personnel has significant implications for US commercial uh competitiveness. Does the current model for assigning foreign service personnel reflect where US businesses need the most support today? Mr. Chairman, the answer is no. uh uh the chairwoman pointed out that commercial service officers are present uh in countries that re uh reflect about over 90% of the countries uh to which we export.
▶ 0:39:38Uh that's an important metric but cannot be the sole metric by which we measure success. In fact, uh it's the countries where we are absent, uh where we are losing uh most particularly uh and where we need to have a stronger presence and that requires both um a second look at the current allocation of officers as u as has been tried to be done in recent years, but also just a an upping of the resources needed to reach the the whole world as our competitors have done.
▶ 0:40:06Great. Thank you. I yield back.
▶ 0:40:08Thank you. I now recognize ranking member Bara for five minutes of your
▶ 0:40:13Thank you, Madam Chairwoman. Um, listening to all of our opening statements as well as yours, I think there's um broad agreement that um for foreign commercial service officers are incredibly important. If we want to compete in a global environment, we've got to be promoting our businesses. If we want to support our small businesses um that do have products to export, helping them navigate a comp complicated world is extremely important.
▶ 0:40:39And again, if we want to this isn't the 1960s or 1970s when the United States could just show up and we had the best products and and services. This is a very competitive global space right now. Um so adequately resourcing these services are are super important. We also know we have multiple tools in the government.
▶ 0:41:00You know, obviously we talked about the um the FCS um but we've got the Development Finance Corporation, the MCC, um Export Import Bank, USDA, um the Small Business Administration, US Department of Agriculture promoting our crops and um so again broad agreement that this is is important. It should be adequately funded um in a global environment.
▶ 0:41:25I think the question that we Congress as well as this committee will grapple with is where's it best housed in an inter agency process and you I think I'll direct my line of question to each of you to to think about that how best to coordinate across the inter agency model and you know President Trump would probably take it as a compliment that you know doge has been disruptive we are where we are so let's not relitigate that but we should think about not rebuilding what we had before But how I'd
▶ 0:41:55like to approach this is what comes next and how do we create a a process across multiple agencies that is most effective in promoting US economic interests and US business interests. So you know maybe we'll start over here um and just let each of you answer that.
▶ 0:42:15Thank you Congressman. One of the things I discovered uh very early upon assuming the post as assistant secretary in visiting uh our officers across the United States was how incredibly well-connected they were and how they had a visceral sense of where solutions existed in government for small businesses that came to them with problems.
▶ 0:42:37One of the things uh they were clear about is that it's not up to the small businesses to work through the alphabet soup of all the agencies and all the tools available in the federal government. uh and so commercial officers in the United States in particular serve as an important front line for intake of problems and concerns coming from small businesses and can then help them identify the tools across the federal government that might solve those problems whether it's SBA or or Exom or other agencies.
▶ 0:43:02I think that core strength is something that can be built on and and built up to uh to do across the organization and to work in other areas like uh like critical minerals and other strategic areas of importance. Miss Shy,
▶ 0:43:17I would just add that um when we're working in an embassy and you're the senior commercial officer. We're sitting side byside with our State Department colleagues at country team in front of the ambassador. Um you know, we're not down the street down Constitution Avenue. We're working together daily to achieve those goals so that there is to American businesses and people that come to the embassy, there's no um screen.
▶ 0:43:40they don't know that commerce is helping them or state department helping them or or energy is even helping them is that it really is a team spirit and it works well. Um the separation of the service in from commerce to state is not I think at at issue is that we work very well together. It's more of a funding issue to be honest.
▶ 0:43:59Mr. Gson,
▶ 0:44:01uh thank you sir. Uh I think it really comes down to the US export assistance center is translating that alphabet soup based in communities across the United States. they play a critical role. There's no doubt that the user interface for the private sector needs to be streamlined but apps at that happening the the US export assistance centers play that critical role.
▶ 0:44:18So if I again just taking um your answers you feel you know the current housing within department of commerce is fine it's less where it's housed it's more the tools and then having the resources here domestically that are available you know again whether that's in commerce SBA um that are available for those small businesses and even large businesses sometimes to say hey here's an opportunity here's the tools we'll help you navigate this and help you
▶ 0:44:48compete for those contracts is that so again there's going to be a debate about moving this to state department versus keeping it in commerce um you know you think the system's working not adequately resourced but
▶ 0:45:05congressman I think what I would say is in addition to what has been pointed out here and the value of the existing structure and the existing officers and their ability to connect other agencies two other things that I do think um need greater attention. One is helping um the foreign commercial service prioritize its efforts. It is it is and always will be an agency of scarce resources. There will never be enough resources to fully uh accomplish uh the objective.
▶ 0:45:33So it it's important that uh at the direction of leaders um in uh in the commerce department that they able they're able to prioritize their work in sectors that matter most uh to to Americans. So I think that's is is critical.
▶ 0:45:48I also think in addition to the prioritization piece of this is that we have to find a way for uh commercial service officers to get the training they need to respond to the the constantly changing dynamics and this is where
▶ 0:46:07gentleman's time's up. So can you please wrap up please?
▶ 0:46:09Okay sure. This is where I would just say sir that an equivalent of FSI for the commercial diplomacy function is critical and it would be different from what is at FSI right now.
▶ 0:46:19Thank you.
▶ 0:46:22Okay. Um the under secretary Jason Evans testified here on March 19 that in quote our econ officers in the past have been trained to do economic reporting. Now we are shifting to a situation where commercial diplomacy is our policy. So we are working very closely with our econ officers to make sure they have the skill sets to go out there and do that commercial diplomacy.
▶ 0:46:52End quote. Mr. Goldson, what do you think of Under Secretary Evans proposal to res re retrain uh econ officers to be commercial diplomats?
▶ 0:47:04Thank you, Madam Chair. I think it reflects the the centrality of cor uh commercial diplomacy today and I go back to my user interface comment for the private sector that has to be coordinated or or we will not be successful overseas. So it certainly reflects that that critical nature of it but I I hope that we can ensure it's aligned for the private sector as they interact with this engagement.
▶ 0:47:26Um Mr. uh banker ramen the commerce department has been cutting and reducing the size and resources of the foreign commercial service for years and so having served in commerce why do you believe commerce has so little appreciation for SCS I mean FCS uh do you believe these cuts are consistent with the importance of commercial diplomacy and the uh US interest
▶ 0:47:52Madam Chairwoman I don't think it's a reflection or a lack of appreciation for the commercial uh service I I think in fact what it is is that the demands on the commerce department itself have grown considerably not just in the foreign commercial service but also in the bureau of industry and security and in other areas and so as those demands have grown across the department uh the funding across the department has not kept up with the needs.
▶ 0:48:13Got it. Um as global economic competition intensifies the state department must be equipped to proactively advance the US commercial interests. We agree that with that uh current foreign service structures diffuse commercial responsibilities across cones which may limit focus and accountability particularly compared to the more specialized clientfacing model of the FCS.
▶ 0:48:39So as Congress considers foreign service act reform, especially a dedicated commercial diplomacy track could better align expertise, incentives, and career pathways with the growing importance of economic state craft and commercial uh advocacy. So question, it's a free-for-all. Anyone can answer this. Should Congress establish a dedicated commercial diplomacy track within the foreign service and what would the advantages or risk compared to the FCA's model?
▶ 0:49:09And can you also talk about guardrails? What guard rails should be in place for a commercial track to differ from the current economic cone in terms of hiring, training and career progression? And then what skill sets or professional background should be prioritized like in private sector trade promotion or investment facilitation.
▶ 0:49:31And then lastly uh how should assignments and promotion incentives be structured to ensure sustained focus on delivering for the US businesses. And I threw out a lot of questions there. So you guys can take whichever to respond to that.
▶ 0:49:46So I'll I'll go ahead and uh say yes. I think that should absolutely be examined. I think the on the positive side and the main issue in my view for the foreign commercial service over these past 20 years losing resource is the centralized cost structure of having a platform overseas. Not to get too technical but ICAS MCS and the foreign service personnel system that has not been managed well within the department of commerce over 25 years because it's very complex and when it's time to cut it's easy to cut that without understanding the unintended consequences.
▶ 0:50:15Having that structure inherently baked in with the state department is helpful. I think the risk is losing that entrepreneurial spirit and client focus and expertise. So I would recommend against copy pasting into an existing structure and rather having the opportunity to innovate how that looks going forward.
▶ 0:50:31Got it. I like to have the other two have the opportunity to respond.
▶ 0:50:36I think um a good model that state department actually had launched was the digital attaches model. So thinking about the um industries of the future and what's really pushing American econ the American economy and where there is opportunities overseas. Um I understand that that that may not be um that program may not be as robust as it was before but I think that that's that's moving in the right direction.
▶ 0:51:00Um, if there was a dedicated commercial cone, I would say that actually that would be more in line instead of having a commercial and economic cone to be more focused on commercial to be more focused on American businesses and American industry. Again, thinking about how the commercial service could lend that the the model to the state department would be excellent. Um, we are only in the commercial service isn't only in 70 plus countries.
▶ 0:51:25Um obviously state department covers the entire globe and so right now the commercial service is limited and so state department officers, econ officers and commercial cone could actually represent American business in so many more markets.
▶ 0:51:39So it would be advantageous to the US
▶ 0:51:41Sure. You have the final word.
▶ 0:51:43I would say I think one thing we don't want to lose is that the econ officers of state are valuable. Uh this is not a situation where we need to replace what they do by making them do something else. they have value and we should maintain that value and what I'm think seeing is a distinct value provided by the foreign commercial service and so wanting to maintain that those separate the benefits that we get uh is I think is important and not to conflate everything because we do need everything but we do need them um distinct in order to be able to accomplish what we need to
▶ 0:52:14Thank you all. I now recognize uh ranking member Sherman for five minutes of questioning. Madame
▶ 0:52:20Chairwoman, the room's empty. Of course, you have the greatest two members.
▶ 0:52:25I'm still here. I'm still here. It's not
▶ 0:52:28As I was about to say, you do have the two greatest members of the Democratic caucus here. And we have two Republicans in the off in the room as well.
▶ 0:52:38Two great California Republicans.
▶ 0:52:42All California.
▶ 0:52:42You're all California.
▶ 0:52:44We're all California.
▶ 0:52:46This room would be full if we would have a hearing on what we're doing in Iran. The greatest economic effect of our foreign policy today is the straight of Hormuz. And instead, we're focused on a matter which is not being covered live on C-SPAN 3.
▶ 0:53:08We need Rubio in that chair talking about what we're going to do to bring peace to the Middle East and to prevent Iran from having a nuclear uh Mr.
▶ 0:53:25Goldstein, uh, are our commercial services and other economic uh, diplomacy efforts adequately funded and how do anecdotally I see the embassies of our major trading partners with the commercial atesache and the trade atesache being at the very heart of the embassy's operation. I don't see that in American embassies, but that's just anecdotal.
▶ 0:53:53Um uh we've had repeated budget cuts in this area. Are we funding this area adequately? And how does it compare to uh the level of energy put forward by our trading competitors/friend?
▶ 0:54:10Thank you, ranking member. I think the the short answer is no, we are not. And it's for the reasons um I highlighted on the internal cost structures of running a platform overseas on a state department platform which causes uh personnel cuts, cuts to training, cuts to travel. So no sir, we are not.
▶ 0:54:25Gotcha. Concerned a bit about the possibility of corruption. Uh I'll ask all of our witnesses if you're aware of any um e academic or other studies or reports about resolve the revolving door situation where people engaged in commercial diplomacy then end up with a good employment contract with an American company with overseas uh business interest. Has anybody studied this issue to your knowledge?
▶ 0:54:54I'll take I assume the answer is no unless somebody jumps in and tells me. Um likewise, has anyone studied whether uh campaign contributions or uh um the allocation of resources of our commercial diplomacy? Does any do you are aware of any studies on this? All witnesses are shaking their head and saying no. Uh Mr. Ven Cutamman.
▶ 0:55:23I previewed this in my uh opening statement. Um you get major American companies who we think are in America's interest because what's good for GM is good for America. They said a century ago. Um and they're pushing our commercial attaches and others to uh I think in in your words strengthen supply chains.
▶ 0:55:51But often what this means is take actions which offshoring our manufacturing. Uh is there any system inside this the state department or the department of commerce to analyze not are we promoting the interests of a major American company but is what they're asking us to do in the interest of waging raising wages or is it in the interest of facilitating imports?
▶ 0:56:20what formal analysis goes on there.
▶ 0:56:26Thank you, ranking member. There is um in the heart of the mission of the foreign commercial services as it stands today this clear focus on supporting companies that export and by virtue of exporting creating jobs in the United States and bringing those economic benefits back home. That is the value of the current mission. I think as we redefine the mission, I agree with you that we need to make sure that we keep that laser-like focus on bringing those benefits home.
▶ 0:56:53That doesn't mean we need to keep limit the mission to supporting exporting firms. I do believe there's a way to strengthen supply chains as we need to do to protect the American economy in a way that is that does support American jobs here. I don't
▶ 0:57:06is there a formal checklist or study to see whether the what we're being asked to do actually supports American jobs and do we favor those American exporters that pay a living wage versus those uh that are perhaps ununized and pay very little. So, we do not, as far as I'm aware, and I'll let my colleagues speak to this, but I do we do not select uh the companies we help on the basis of what their wages are.
▶ 0:57:32Uh but by virtue of the exporting function uh that they perform, it's how we make sure that American uh jobs are protected.
▶ 0:57:39I yield back.
▶ 0:57:40Gentleman yields back. I'll follow up on that uh I think a little bit. When we talk about consolidation, taking back something that's been at commerce since the 1980s, we're talking about consolidating to to the State Department.
▶ 0:57:55The State Department lost this function because they didn't pay attention to it because it was perceived that they didn't have the track and that other missions uh you know continue to uh take precedent and including good relations. sometimes can be about promoting uh a company uh doing business, but it also can get in the way of it. Uh and I'll give you uh just a couple of examples.
▶ 0:58:24Uh South Korea, Colombia, and for that matter all of Europe, but I'll just take the first two. Uh South Korea has denied Google maps the ability to do business. the state department has not been effective with a a partner in which we are providing material support that keeps them from being invaded.
▶ 0:58:46Uh similarly, coupon was fined over hund00 million after they had materials stolen from them and they worked with the government to have it recovered. They still were not only fined, but they were raided and their uh their chief executives were called from the United States and then essentially imprisoned um while they were being interrogated over something in which there was no data loss.
▶ 0:59:15Those are diplomatic challenges that fall to the state department. Similarly, the equivalent of Costco uh the price organization operating in Colombia and throughout South America finds itself effectively systematically being locked out to favor domestic companies. These are companies already doing business.
▶ 0:59:37Now, isn't the primary ongoing requirement of the State Department is when somebody's already doing business in a foreign country to aid them, to make sure that they are being treated fairly. And isn't that a responsibility that there seems to be plenty of room to, if you will, do Yeah, you you're in the hot seat.
▶ 1:00:02Happy to be in the hot seat. The answer is yes. But I want to be clear that this is not just a function of the state department, right? This is as my colleague Christina mentioned at post the ways in which the commerce department and state department work together. It's just it's not even working together. They're they sit next to each other literally and they are on the country team together with the ambassador advising the ambassador. And
▶ 1:00:21so for what it's worth, I spent two years uh designated as the head of the trade development agency. I I I I appreciate the fact that under the chief of mission, everybody including the FBI works for the chief of mission.
▶ 1:00:37And so what I would say though and what I would submit congressman is that the having these functions separated into the two agencies is is actually a source of strength because much like the inter agency process by bringing the agencies together and having each agency fight hard for its perspective uh and then collectively creating a unified policy I think that helps advance American interests and so the commerce department has a history and a culture of being thinking business first American business first there's no doubt about that there's
▶ 1:01:07not ever a real balancing of other for interests that have to happen for any foreign uh service.
▶ 1:01:14And I'm going to pile on Miss Shy. Is it fair to say that in a perfect world you would have two centers of excellence. the entity, we'll call it commerce for a moment, that recruits and develops people who understand domestic companies, that meets with them in the United States, that has large offices throughout the United States, and who in fact coordinate as many aspects of the export
▶ 1:01:44opportunity and encouragement as possible and then working handinhand with the State Department who has expertise a in overseas and b in the of dealing with the barriers that may exist. Uh some of them coming from for example China and nefarious activity.
▶ 1:02:05Isn't that essentially what if this committee does the right thing we would do is not build one organization because you can't you can't really make the State Department foreign service person an expert entrepreneur in Cleveland, I use Cleveland for personal reasons. I actually was born in Cleveland.
▶ 1:02:25As was I. [laughter]
▶ 1:02:28Yes, sir. Um I think that recognizing the importance of helping small and medium-sized businesses export and the US fields um role in that is very important and also that that work actually also informs our work overseas as well. Um because breaking down barriers is not just something for large companies. It can affect small companies as well.
▶ 1:02:53So um absolutely I think having that network um you know in theory if we were very well uh resourced if we had you know the the training that was necessary the HR the um we didn't have the administrative costs it would be great to stay within commerce um because we do play a vital role um but that's just not the case and I don't foresee it being the case in the future
▶ 1:03:17as one Clevelander to another you'll notice that I said commerce first, but I said it in Today, the XM Bank is an independent organization. The Trade Development Agency is independent. As a matter of fact, our entire funding system is a group of independent organizations.
▶ 1:03:37My question to you is as you're looking currently what's in commerce and currently what's not in commerce, is it reasonable for this committee to think big and and look at the possibility that would be two entities? one that takes on the belt and road.
▶ 1:03:58One that works with all of our businesses including of course infrastructure developers all the way down to the small business and develops two centers of expert expertise. One that is classic State Department development which is diplomacy sometimes telling somebody to go to hell and having them pack happily for the trip. Secondly, those who in fact putting together the rest of the package.
▶ 1:04:24So my question is if we were looking at a consolidation and let's forget about whether it's housed X Y and Z but let's just assume for a moment that it were completely autonomous that trade development XM bank and the plethora of others including what is currently at commerce became part of an organization who had a structural mission to do exactly what you're saying and had the combined resources to do so.
▶ 1:04:50Is that plausible knowing that in the first Trump administration they did some of that and we are now in a second Trump administration and there's a will to do something big to help us take on very difficult uh access barriers.
▶ 1:05:08Yes sir. I absolutely appreciate that kind of uh innovative thinking and different different approaches that could serve us businesses best. So I think looking at every potential um for a reorganization inside outside commerce a whole trade organ reorganization is worthwhile and something that I would encourage the committee to do.
▶ 1:05:28Well with my ranking members seeming to be happy I will uh
▶ 1:05:35who's next?
▶ 1:05:38Okay, Mr. Amo is recognized for five minutes and my apologies for running on. At one point we had nobody else in the queue. I apologize. Gentleman's
▶ 1:05:48Thank you, Mr. Chairman. Uh, and thank you to the leadership of, uh, both subcommittees for hosting, uh, this hearing, and thank you to our witnesses for being here. President Trump talks a big game about promoting US trade, but his actions are doing the opposite. His chaotic and unlawful tariffs have strained relationships with our allies, weakened our commercial diplomacy, and raised costs for American businesses. His illegal war in Iran and blockade of the trader hormuz have destabilized global markets.
▶ 1:06:19American businesses don't expand into new markets in chaos. You all know that. They need stability. They need predictability. And right now they're getting neither. That's why programs like the foreign commercial service matter. As you know, the foreign commercial service helps American companies break into foreign markets and brings investment back home. It's a direct pipeline to jobs and growth in the United States. But this administration has dep prioritized it. The facts are clear.
▶ 1:06:48Doge pushed experience officers out the door and the hiring freeze has left critical gaps. And now we're seeing the dire consequences. Foreign commercial service officers are posted to over 75 export markets which account for 90% of global GDP. But in smaller and emerging markets, there's often no dedicated presence at all. That leaves American businesses on their own as they navigate unfamiliar regulatory systems and commercial environments.
▶ 1:07:16For example, the US embassy in in Yeravan doesn't have a foreign commercial service presence, leaving companies interested in that market to be routed through Ankura hundreds of miles away in a completely different business and political environment. That's not a serious strategy for supporting US businesses in emerging markets. Uh so uh Mr.
▶ 1:07:38Venitaram how does the foreign commercial service determine where officers should be posted overseas and what factors, for example, determine whether a market like Armenia would get a dedicated presence?
▶ 1:07:56Thank you, Congressman. when looking at where to uh assign officers and my colleague Christina was intimately involved uh in this uh when I first started the position the we look at where American business is being done but we need to look more what we started to do is look more where American business is not being done and why is it not being done there because what we know is that when American business is present in foreign countries that serves as a vital connective tissue of partnership
▶ 1:08:26with that country We want American business to succeed in foreign markets. And so if American business is not in a foreign market, that means they need help entering that foreign market. So we need to look at the gaps where American business is not located and not use that as a reason not to place officers there, but ask the question, why are is American business not there? And one of the things that we need to do with the foreign commercial service um is not be passive and not help people that come in, not just help people that come in, but be proactive.
▶ 1:08:55So for example, if there's a tender on a critical minerals project in the Democratic Republic of Congo Congo, it should be the responsibility of the foreign commercial service officer in in that country to not just see if American companies are interested, but to go hunt for American companies who should be interested because it is in our interest for American companies to participate in that tender. So we need some of and in order to do that, we need to be present in markets where American business is not sufficiently active yet.
▶ 1:09:22Yeah. And that and that makes sense. And so that's why the we need the personnel and and so ultimately you know that at embassies where there's no foreign uh commercial service presence like Armenia uh state department foreign service officers often you know fill in the economic section fill that role.
▶ 1:09:38Um so could you speak to uh the difference in training, expertise and mission between a foreign commercial service officer and a state department economic officer and what do US businesses lose as we you know try to fill those gaps when we don't have dedicated commercial
▶ 1:09:59So I'll start invite my colleagues to to chime in. The I want to be clear that our State Department partners at these partner posts um do receive training and they are fantastic partners and they are able to help us perform functions that we cannot perform by virtue of our absence. Uh and so we work with them to give them initial training to uh to think a little bit more like a commercial officer and to respond to client interest the way a commercial officer would. But as you point out, Congressman, that is ad hoc. That is temporary.
▶ 1:10:29That is not a solid grounding of training. Nor is it the years of expertise built up that a commercial officer brings to every post. Uh that's not the fault of the economic officer at post. Uh that partnership is important, but it is very much a second best solution that we have to uh live with today. They're training uh they're exposed to economic policy. They understand macron economic conditions and they can support business but they are not a business first mentality which is what commercial officers bring.
▶ 1:10:56Miss Sharky, if you could briefly.
▶ 1:10:59Yes sir. Um yeah we do offer partnership post uh program and commercial trade craft is offered at the national foreign affairs training center. Um but as Arun had said yes uh you know these in a small post like Yeravan you have you know a commercial officer maybe one or two local staff um and they're juggling multiple priorities. So commercial isn't
▶ 1:11:22My time is expired but thank you for your feedback and thank you. Sorry about that. I yield back. Yes, Representative Bar from Kaki is in. So I would now recognize you for five minutes of your questioning.
▶ 1:11:42Thank you, Madam Chair. Thank you. Thank you to our
▶ 1:11:46ask you a question here. Thank you. All right. Thank you to our witnesses for being here today. Just a few questions. Um, Mr. Goolson, let me uh let me ask you first.
▶ 1:12:13Given your experience as former deputy of the United States and foreign commercial service, would consolidating uh US commercial diplomacy functions under a single agency improve outcomes for US businesses, particularly small and medium-siz enterprises? And as you contemplate that answer, a follow-up question would be how might such a restructuring enhance the effectiveness of current global markets framework navigating non-tariff barriers and protecting US companies intellectual
▶ 1:12:44Thank you for the question uh sir. I think the answer is yes. If it's done inclusively that includes the the local offices throughout the United States, the advocacy center, select USA, etc. All elements of commercial diplomacy power uh it would improve the user interface for the private sector. Yes
▶ 1:12:59Thanks. Um for for any of you um the president's America first trade agenda has been important uh in my view in bringing in foreign investment into this country through trade deals. Uh and the results are you know undeniable uh trillions of dollars uh in commitments of foreign direct investment including a trillion dollars from Japan as a result of those uh tough but uh substantive negotiations.
▶ 1:13:26600 billion dollars from Meta, another 600 billion from Apple, which is moving a 100% of the glass manufacturing for their iPhones and Apple watches to my district in Herodsburg, Kentucky, Mercer County, Kentucky. We have an existing Corning facility there in Mercer County. But jobs that are currently in China are coming to my district as a result of trade and tax policies from this administration.
▶ 1:13:50All of this hard glass is going to be manufactured by Kuckians in my district as a result of these policies. Can you speak to the effectiveness of these efforts in strengthening US economic competitiveness and what role, if any, should the US and foreign commercial service play in expanding this inward investment momentum? Any of you?
▶ 1:14:13Well, thank you, Congressman. Uh I think the function of the inbound investment piece is um insufficient attention is being paid to that right now by the commercial service and it's not their fault. It's again they're juggling uh many objectives. We need to prioritize that inbound investment piece as part of their uh function at post. They're already doing that with the help of local staff, but that needs to be made more of a priority and more resources and more more staff given uh to do that.
▶ 1:14:41Well, I I'm the co-chair of the Global Investment in America Caucus. Part of the reason I am is not just because of this investment in Corning uh from Apple. Uh but also because I represent and I'm privileged to do so, the largest Toyota manufacturing plant in the world in Georgetown, Kentucky. And the supply chain, there's 10,000 team members there. Um this Japanese investment in Kentucky is ma is massive and these are higher paying jobs.
▶ 1:15:09So uh I just appreciate the Trump administration uh uh policies which are again inviting more of this not less. Finally uh China in the face of intensifying strategic competition from the CCP which routinely leverages stateback financing subsidies and coercive economic practices to push its companies and reach globally. Many are concerned that the United States uh is being left at a disadvantage. This is particularly true in critical minerals supply chains where China controls 70% of the mining and over 90% of our finding.
▶ 1:15:39What specific reforms are needed to ensure that the US and foreign commercial services is fully in line with our strategic and economic security priorities especially countering Chinese influence in critical minerals.
▶ 1:15:51Thank you sir. I think it's personnel where we place our foreign commercial service officers in critical markets where we have that strategic competition and ensuring that they have the staff and resources necessary to be effective with the host government. Well, anybody else? I if not, let me just say this is kind of the a final editorial comment.
▶ 1:16:10When I've traveled as a member of the Foreign Affairs Committee, I think um it's important that as an ambassador from Kentucky, we each have our signature industries in our state, you know, we want to export more Kentucky bourbon whiskey, for example. And whether it's bourbon in Kentucky or maybe it's a signature, maybe it's uh
▶ 1:16:28wine in in California, whatever it might be, we have our ability to use our state's assets as as diplomacy and engender goodwill. And uh we want to open up those markets uh for Kentucky bourbon. Um it's a great talking point. Uh it's it's a great diplomatic point is and it's great for American. This is a this is a multibillion dollar industry in Kentucky. And um it it makes people uh uh pro-American, frankly.
▶ 1:16:57Uh whether it's California wine or Kentucky bourbon whiskey. And we want to open up markets. Uh this is a a a very important part of of commercial diplomacy. I would encourage all of you all as you pursue excellence in this area to think of Kentucky and open up those markets. Especially India, 1.4 billion people. Uh India needs to reduce its its trade barriers uh to American bourbon whiskey exports.
▶ 1:17:22Um that that is going to strengthen our alliances and strengthen our economic ties and counter China all at the same time. With that, I yield back and next uh uh uh the the gentle lady uh Miss Sheris McCormack is now
▶ 1:17:39Thank you so much, Chairman, and thank you for so much for opening the door for us to plug our cities. because I didn't know we were going to be talking about Kentucky and the bourbon, but thank you. So, I represent the wonderful state of Florida and many of our constituents talk repeatedly about wanting to explore all the opportunities international and I really love what you were talking about, Mr. Vancman, um about our presence, needs to be more than our presence, but actively scouting out opportunities for our businesses.
▶ 1:18:05I'm just not convinced that we have a plan or we have the actual footprints and steps so we can attain that. And so um the United States is still a global export powerhouse. But in the very markets that will shape the next century, we are getting outplayed in emerging markets across the global south. Our companies are watching competitors move faster, invest deeper, and lock in long-term markets share while we rely on tools and strategies designed for a different era.
▶ 1:18:34Nowhere in this more nowhere is this more obvious than in Africa, especially northern Africa. For example, the African continental free trade area is knitting together a single fast growing market of more than 1.3 billion people, a young population in rising consumer demand projected into trillions of dollars. That should be an area where American innovation, American brands, and American values are front and center.
▶ 1:19:01Instead, others are writing the rules, building the infrastructure, and winning the loyalty of the next generation of consumers. That is why we are here today. Our core question is simple. Is America actually equipped or comp or competent to actually achieve these goals.
▶ 1:19:18Our foreign commercial services is supposed to be a tip of the spear for the United States businesses overseas, helping our firms find partners, navigate barriers, and stand toe-to-toe with statebacked rivals. But if we look honestly at the trend, it's hard to argue that our current approach is delivering the results we need. So I will be asking all of our witnesses these questions.
▶ 1:19:41In your judgment, is our foreign commercial apparatus, our people, our presence, our playbook, is it strong enough to make American business truly competitive in this emerging market? And if not, what would you suggest we add to it?
▶ 1:19:57Yes, thank you for the question. Um, regarding Africa, I in my view there's no doubt whatsoever. We added recently officers to Zambia to Cottovoir. It made an immediate impact. There's no substitute for having that on the ground presence engaging the host government and private sector on American companies behalf large and small. So that's that's number one. We are not in enough locations and that's fundamentally comes down to the internal cost structures that I keep on raising.
▶ 1:20:23But if we got that right, uh I I think it would be highly effective to be in these these markets where we do face steep
▶ 1:20:30Well, I think that's the um most basic, you know, step of this is presence. So, we definitely do agree with you with the presence, but what else could we add to it? Because, you know, you said the statement very clearly, active acquisition, scouting out and connecting our businesses. So, if there's anything else that you would add for us to be able to reach this goal.
▶ 1:20:48Thank you, Congresswoman. I think uh the metrics of the officers need to be tied not just to the companies that come in but to the companies they find and bring into a market. Uh one of the problems we have Africa is a prime example of this. We have a number of American companies that frankly aren't very well informed on Africa or they think of Africa as a singular place which of course it is not. It is a large continent with incredible diversity.
▶ 1:21:13There are markets that are hungering for American companies that have a lot to offer and have a lot of stability and a lot of opportunity to make money. And there are a lot of markets that are also incredibly problematic and hard to do business in. Africa is not one single place to do business. And so one of the things our officers can and should be doing is educating the American business community about the opportunities that exist in those markets that are most favorable and that are our closest partners and that are like-minded on many of the these issues.
▶ 1:21:39And that requires making sure they are measured on that basis of finding the companies to come in to do the tenders. Not just supporting companies that realize there are tenders and and helping them, but finding companies to participate in the tenders in the first place so that we don't seed ground without even competing for tenders against our strategic
▶ 1:21:58Thank you for that because that's something I think this um administration has done well in my district. We have been having opportunities in Africa and they've actually been sending people to connect. But I think you're absolutely correct about expanding and finding more opportunities because usually those opportunities might be a handful if any and so you have uh you know maybe hundreds of companies but there's only a handful of opportunities. So expanding that would be helpful. My next question that you can join because my time is running out. Um resources what resources would you need?
▶ 1:22:26If you have any request requirements we would love to assist. That's for anybody.
▶ 1:22:34Obviously, I think the budgeting or the budget request needs to be increased. So, the the current Trump administration has put a $150 million decrease and that obviously is is unsustainable for the
▶ 1:22:46Thank you. I yield back.
▶ 1:22:47Gentle lady's time is expired. Uh Mr. Olvesky is recognized.
▶ 1:22:51Thank you, Mr. Chairman. And uh impressive uh pronunciation there as well. So, thank you, sir. Uh, and I also appreciate the title of this hearing, helping American businesses win abroad. I'll just start though by being clear. The best way that we can help American businesses win, is to lower prices for American families. I was driving into DC uh today.
▶ 1:23:13And I was shocked shocked to see that gas prices are now $4.50 per gallon, a number that is set to grow even more with the blockade of the straight hormuz. So, I'll re-emphasize the point. my colleagues have made earlier. We should also be having public hearings on the war in Iran.
▶ 1:23:31Those gas prices would be would be bad enough if that's just what Americans were paying at the pump, but sir charges are enacting consumer price increases everywhere, including a new 3.5% tax on all products purchased through Amazon. The impact of this war is only serving to compound compound the president's destructive tariff policy. So when we talk about helping American businesses win, we need to remember that this administration has failed on their promise to do what American businesses really need.
▶ 1:24:02That is to lower costs and create consistency. And yet I choose to remain hopeful. Just last week, we were reminded once again of who we are or who we can be as a nation. Many of us watched in amazement as Artemis 2 splashed down. I personally felt so much pride in what NASA has accomplished with this mission. The icing on the cake for me was that Maryland's own second district native Reed Wisman was the captain of that mission.
▶ 1:24:30Uh and I have to say the incredible NASA team reminded Americans why we have to stay competitive in the space race. It's good for our economy. It's good for our security. And as we experienced this week, this past week, it is good for American morale. Uh Maryland also has a vibrant commercial space industry that I've been fortunate to engage with first as Baltimore County Executive and now as a member of Congress.
▶ 1:24:52And so to keep that momentum going, we know that we need a strong foreign and commercial service that can engage on these space issues, not the kind of extreme budget cuts that frankly were just uh referenced by you, Miss Shley, um from this administration. As we've heard, the president proposed a $150 million decrease for the account that funds foreign commercial service. Combined with Doge cuts and last year's hiring freeze, the FCS is underresourced at precisely the time when commercial diplomacy is needed most.
▶ 1:25:22Meanwhile, the PRC understands that space leadership is not just about rockets. It's also about relationships. They have 10 times the number of commercial officers in several key posts around the world. That means better deals for Chinese companies, often at the expense of American businesses. As of 2025, China has signed nearly 200 space cooperation agreements with over 50 countries and international So, I guess I'll ask in light of all that, Mr.
▶ 1:25:50Goolson, I know that Meridian has an exciting space diplomacy initiative, uh, global space cooperation program that's focused on expanding international collaboration and helping American space firms compete globally. Uh can you talk to me first about what are the main diplomatic, regulatory and bureaucratic barriers keeping US space companies from maximizing these international partnerships and specifically out competing China and how commercial diplomacy can help address
▶ 1:26:17Yeah, thank you very much for the question, Congressman. Uh Meridian did recently host a space diplomacy forum where we had players from around the world uh the space industry engage and importantly we're developing theme small mediumsiz enterprise engagement channels to to enter that space. I think more broadly we've been talking about economic security and critical emerging technologies and equipping US companies to compete in that space. overseas with our diplomats.
▶ 1:26:42That requires new training, new resource, and a new focus on markets where we have those opportunities for yes, the large space companies, but also the midsize and small ones as well.
▶ 1:26:51Great. Thank you. And then um can you also speak to why it's important for our businesses that we have that technical and business knowledge of how um this emerging space economy actually works?
▶ 1:27:02Absolutely. because for a mid-size company in particular, they don't have the resources to develop the in-house uh governmental expertise for diplomatic engagement. And so certainly there's actors like like Meridian within Washington, but also embassies around the world, our embassies, US embassies that require that training and that engagement to help those midsize companies enter the market, whether it's the Emirates to compete against the Chinese or Brazil or you name it. Uh we really need those experts on the ground.
▶ 1:27:30I appreciate that very much and I I do agree. I think that's why the US needs a well-resourced cohort of commercial diplomats who can champion these American space companies abroad. We all want the US to be the partner of choice for countries launching their first satellite, building ground stations, or joining collaborative missions. But to remain that trusted partner, we have to pair our technological leadership with strong diplomatic engagement. And with that, Mr. Chairman, I yield.
▶ 1:27:53Gentleman yields. And before we wrap up, the ranking member is recognized for a a final question.
▶ 1:27:59Great. Thank you to to my good friend from Kentucky. I do think it, you know, Kentucky bourbon, California wine, grown some California pistachios, almonds, and walnuts. We get a lot done and open up a bunch of export markets and crab cakes as well. Um, all goes together.
▶ 1:28:15Yeah. My my follow-up question is kind of a two-part question. uh you know when I think about multilateral development banks like the World Bank, the um Asian Development Bank, the United States, US taxpayers are the biggest funders of a lot of these. But when you go out to bid um in competition, the PRC often is getting these these contracts and you know folks in say hey the United States is absent. Why aren't you guys doing anything?
▶ 1:28:43Well, we are doing something and that's that's part of it. How do we get our companies to be more competitive? Um, the second piece of it though is more complicated because yeah, I travel a lot and spend a lot of time in Asia and the the Pacific Islands and um, Chinese business practices, Beijing's business practices um, are operate in a way that we can't operate. We can't and we don't want our companies to drop bags of cash off here or there.
▶ 1:29:13Um, um how do we create a more competitive environment for our companies, especially when we're funding um we're the largest funders for these organizations and then get the recognition for the United States of America that we are actually the ones building this project. So I I get it, you know, when the president talks about, you know, these are US taxpayer dollars, but someone else is doing the work.
▶ 1:29:39Obviously, I think Congressman Bar and I would like to see US companies do this work if we're using our taxpayer dollars. I'd just be curious.
▶ 1:29:47Yeah, I'll add quickly that uh the the advocacy center at the Department of Commerce has multilateral development bank liaison that do incredible work to try to level the playing field for US companies bidding in that that space. Of course, they're impacted by the same resource constraints we've been talking about this morning. But that that program can and should be built on in my view to to counter that competition that you're referencing right now.
▶ 1:30:08But you get some of the unfair um practices as contracts are being doled out sometimes and So,
▶ 1:30:16and Congressman, I would add that um we did um have the advocacy center uh do a tour around the country to actually bring awareness of these multi-ateral development bank projects to businesses where they are because they they're often hard to discover. It's not readily available information. And so it's important to get that information out there to make business aware of the opportunities that exist through these multilateral development banks because they do want to hire uh and award American companies uh some some of these projects. But we've got to compete in order to to win.
▶ 1:30:45I would also say that um to your question about the challenge of competing without becoming China. It's one of the things that we always made clear is that our value proposition is fundamentally different. I always used to say that American business doesn't just willy-nilly show up and and throw money into a country. Uh, and it might take some time for them to make a decision to invest. The reason is because once they invest, they're all in.
▶ 1:31:11They're a corporate citizen committed to growing their business in that country and growing that that economy. When an American business goes in, they're there for for the long haul. They're not like these Chinese companies that if there's a political tiff, the Chinese government says get out of that country and then punishes that country.
▶ 1:31:28So the strength of American business lies not just in the great business practices, the great labor practices that that we bring in, the great financial practices that we bring in, but the fact that we come in as true partners and that's an a value proposition that is fundamentally distinct from that of our strategic competitors. We just have to make sure that American companies are present and they're in order for them to be present, we have to be present as officers.
▶ 1:31:52thank you all for your uh testimony. I want to thank the witnesses and and the members also for their questions. The members of the subcommittee may have some additional qu questions for the witnesses and we will ask uh you all to respond to those in writing pursuant to committee rules. All members may have five days to submit statements, questions and extraneous materials for the record subject to the length of limitations. Without objection, the committee now stands adjourned. Thank