Federal and state governments must resolve trade and business regulation issues. For Louisiana, not doing so could see the wrong kind of exports — like chasing its oil and gas industry out of state or out of the country, an executive said Thursday.
Eric Danos, executive vice president of oilfield service company Danos and a panelist at the Louisiana Association of Business and Industry's annual meeting, said the offshore energy industry invests billions in projects that take five to 10 years just to produce the first dollar of revenue.
"That's not an industry that thrives in an area of regulatory uncertainty or cost uncertainty," Danos said.
So when changes are swirling around regulations, trade policies, taxes or methods of assessment, those billions of investment dollars tend to move to a place where there's more certainty, he said.
South Louisiana is known for its oil and gas expertise and technoloigy, with its experts stationed all over the world, Danos said. If the state is not careful, Louisiana will encourage the development of the industry and the export of that technology at the expense of state and local economies.
Panelist Thomas Donahue, president and chief executive officer of the U.S. Chamber of Commerce, said the Trump administration and Congress have to figure out a trade policy solution for the economy to grow faster than the sluggish 2 percent seen for the last decade or so.
"The president of the United States has proven in many examples of late that when he gets better informed he moderates his view," Donahue said.
That was seen after visits by Canada's and Japan's prime ministers, he said. The chamber expects to see a more moderate approach to trade.
But the business group, which supports the Trans-Pacific Partnership and the North American Free Trade Agreement criticized by President Donald Trump, will not be pressing the issue for a few weeks, Donahue said. The commerce secretary and trade representatives need to be approved and get familiar with their roles. Once that happens, the chamber will accelerate the discussion.
The Trans-Pacific Partnership writes the rules for global trade. NAFTA covers trade with Mexico and Canada.
Donahue said growth opportunities lie in international trade. For example, China has about 1.4 billion people, four times the U.S. population.
"If we don't fix the trade deals philosophically and factually, we'll never get out of this new normal of 2 percent, and, if that's the case, our children and our grandchildren will have a big damn problem," Donahue said.
Forbes publisher Rich Karlgaard, the meeting's lunch speaker, said he expects the Trump administration's trade stance will shift to more bilateral agreements instead of those covering several countries.
To get an idea where the Trump administration will end up when it comes to trade, regulations, taxes and currency, it's best to look at the Ross-Navarro Plan, a much more nuanced approach to these issues, he said.