And I have to mention that discrimination against women is another barrier to fair competition and economic growth. A 2007 United Nations study found that the Asia-Pacific loses at least $58 billion of economic output every year because of restrictions on women’s access to employment and gender gaps in education. So, as host of APEC, we are organizing a high-level Summit on Women and the Economy in San Francisco this September.
We are also working though the World Trade Organization to address continuing challenges to fair competition. Take government procurement. The purchases that governments make represent an important part of the global economy, and citizens everywhere deserve to know that their governments are getting the best product at the best prices. Consistent with the WTO Government Procurement Agreement that we signed, America lets companies from other nations who have signed that same agreement compete for appropriate American Government contracts. We would naturally expect countries that want access to our government contracts to offer our companies genuine access to theirs in return.
Across the full spectrum of international institutions—the G8 and G20, the IMF, OECD, ILO, WTO, and others—we are working to level playing fields and encourage robust and fair economic activity. Just as the WTO eliminated harmful tariffs in the 1990s, today we need institutions capable of providing solutions to new challenges, from some activities of state-owned enterprises to the kinds of barriers emerging behind borders.
We also support innovative partnerships that develop norms and rules to address these new concerns. We should build on the model of the Santiago Principles on sovereign wealth funds, which were negotiated jointly by host governments, recipient governments, the World Bank, IMF, OECD, and the sovereign funds themselves. This code of conduct governing sovereign investment practices has reassured stakeholders — investor nations, recipient nations, and the private sector. And it may prove a useful model for other shared challenges, like ensuring that state-owned companies and enterprises compete on the same terms as private companies.
As a second step, we are pursuing new cutting-edge trade deals that raise the standards for fair competition even as they open new markets. For instance, the Korea-US Free Trade Agreement, or KORUS, will eliminate tariffs on 95 percent of U.S. consumer and industrial exports within five years. Its tariff reductions alone could increase exports of American goods by more than $10 billion and help South Korea’s economy grow by 6 percent. So, whether you are an American manufacturer of machinery or a Korean chemicals exporter, this deal lowers the barriers to reaching new customers.
But this trade deal isn’t simply about who pays what tariff at our borders. It is a deeper commitment to creating conditions that let both our nations prosper as our companies compete fairly. KORUS includes significant improvements on intellectual property, fair labor practices, environmental protection and regulatory due process.
And let me add that the benefits of KORUS extend beyond the economic bottom line. Because this agreement represents a powerful strategic bet. It signals that America and South Korea are partners for the long term—economically, diplomatically, people to people. So, for all these reasons, President Obama is pursuing congressional approval of KORUS, together with necessary Trade Adjustment Assistance, as soon as possible. He is also pursuing passage of the Colombia and Panamanian Free Trade Agreements as well.
Now, we have learned that, in our system, getting trade deals right is challenging, painstaking work. But it's essential. We consider KORUS a model agreement. Asian nations have signed over 100 bilateral trade deals in less than a decade, but many of those agreements fall short on key protections for businesses, workers, and consumers. There are a lot of bells and whistles, but many of the hard questions are glossed over or avoided.