Trade is Tonic for Troubled Economy, UPS Chief Says

Only global trade will pull the economy out of recession, but the framework for global trade will have to change, says the chairman and CEO of transportation giant UPS.

Speaking at the Detroit Economic Club’s National Summit, Scott Davis cited three imperatives: rebuilding transportation infrastructure, deploying technology to speed commerce and creating a fair, rational system of trade.

“Trade is a major force for good, for growth and for jobs,” Davis said. As many as 57 million Americans work for companies engaged in global trade, he said.

“The threats are from both economic turmoil and the protectionist impulses it drives,” said Davis. “We must argue that protectionism is the worst response at the worst time. We can’t let political expediency cloud global reality.”

He also said all countries must do a better job of helping workers displaced by global trade. “I see a very encouraging step in that direction with the return of the expired Trade Adjustment Assistance Act as part of the stimulus package.”

Using technology to better “see” and control goods moving around the world is critical, especially at border chokepoints, he said. “Global competitive advantage means the right product at the right place, at the right time and at the right cost.”

He also warned that the U.S. is falling behind in maintaining and building new infrastructure. “We’re already paying a price. Our ports aren’t deep enough; our inland waterway locks are functionally obsolete; our highways are jammed, and declining rail capacity is causing choke points across the country.”

It will take years to solve these problems, he said. “We have to do it all and we have to do it right,” he said. “The future of the global economy depends on it.”