Remarks by Chargé d’Affaires Kristin M. Kane – Transatlantic Economic and Trade Summit

Transatlantic Economic and Trade Summit

Address: “Partnership for the Next Decade”

Kristin M. Kane, Charge d’Affaires, U.S. Embassy Lisbon

[As prepared]

[Greeting in Portuguese.  Thank you organizers AmCham. So great to see so many friends of the U.S Embassy.]

Intro

It is so great to be here in person, even if recent days in Lisbon have shown us that the pandemic is not yet fully behind us. The timing is well suited for me and my teams in Embassy Lisbon and Consulate Ponta Delgada on the Azores, because we just concluded last night the first visit by a President Biden cabinet official to Portugal holding meetings at the bilateral and multilateral level.  The Secretary of the U.S. Department of Homeland Security Alejandro Mayorkas spent two days here, along with a U.S. Department of Justice delegation, to participate in Portugal’s European Union Presidency Justice and Homeland Security ministerial and meet with Portuguese officials on issues like cybercrime and ransomware.  He and the EU Commissioners launched a new U.S. – EU Ransomware agreement which we hope will benefit all of you in this room.

Beyond just this visit, we have recently hosted three, 3 or 4 star, U.S. generals on mainland Portugal or the Azores for visits and exercises with NATO and European allies and partners — one of which attracted the NATO Secretary General, who paid a visit to the Naval Striking and Support Forces NATO and its new NATO Communications and Information, or NCI, Academy, also focused on cybersecurity.

I think we would all agree that there is little more important these days than cybersecurity for our governments – and our businesses.  So these visits are just a few reasons we have been busy on our work with Portugal, and Europe.  We do not have a U.S. Ambassador to Portugal yet named – in fact, as of today, there is no White House political appointee Ambassador to any country in Europe yet named – not to the United Kingdom, France, Germany.  The President is taking his time, and it’s clear these relationships are vital – so President Biden is taking the time necessary to get these nominations exactly right, and for that we are grateful and hope that our Portuguese friends see that, too.

Let me speak a bit on TransAtlantic Cooperation, starting with what is foremost on our minds, people staying healthy and safe amidst the continuing pandemic:

Similar the United States, European countries like Portugal are rapidly increasing vaccinations and trying to stay ahead of the new Delta variant.  With our European partners, we know that we must help fight the pandemic beyond our own, relatively wealthy nations:  Last week President Biden announced that the United States government will purchase 500 million vaccine doses for distribution globally.  Our G7 partners joined us and committed to donate another 500 million vaccines.  The combined one billion vaccines will be a big step towards vaccinating the world.  These are not just empty promises.  We just delivered over one million vaccines to our neighbor, Canada, but most of our vaccines are going to those most in need, including in regions we both care deeply about, sub-Saharan Africa and Latin America.  We are doing so through Gavi, the Vaccine Alliance, which is headed by none other than Portugal’s former Prime Minister and the former European Union Commission President, Durao Barroso.  (Speaking of Portuguese leaders, a quick sidenote to congratulate Antonio Guterres on his reappointment as UN Secretary General)

I believe this Transatlantic summit today was brilliantly timed to come just after, “United States in Europe Week” – during which President Biden came to Europe, the very first trip of his Presidency — to the G7, NATO, and European Union summits.  There were two broad themes to President Biden’s trip:  upholding and strengthening democracy in the face of its global weakening; and ensuring that democracy delivers for our people’s economic improvement.  Build Back Better is how the President has put it over the past year, and now the Build Back Better World, or “B3W” partnership was launched at the G7 – a values-driven, high-standard, and transparent infrastructure partnership led by the world’s major democracies to help developing countries suffering after the pandemic.  B3W doesn’t exactly roll off the tongue, but we can all agree on the objective.

At every stop while in Europe, President Biden made it clear that democratic nations of the world – like the United States and Portugal – are in a global contest with autocrats and autocratic governments.  We need to deliver viable alternatives, whether it is ending the global pandemic, addressing the accelerating climate crisis, or confronting the harmful activities of the illiberal governments of China and Russia.  Some contacts of ours in Portugal have told me, “The Trump Administration and his Ambassadors were really tough with us on China.”  We are still concerned with China, even while the tone and tactics from Washington have decidedly changed.  In fact, this broader theme of reinforcing our shared values, like human rights and transparency, will be at the center of our U.S.-Portuguese and Transatlantic partnership for the next decade and beyond.

This is a business audience, and I know you’re focused on results, so I would like to share just a few tangible results from the Europe trip that also help us look to our partnership in the decade ahead:

  • At NATO, President Biden reiterated that the U.S. commitment to Article 5 of the NATO Treaty is rock solid and unshakable: “It’s sacred,” he said. NATO is a place where Portugal and the United States are proud founding allies and stand together, including after September 11th 20 years ago, and with other global challenges.  In so many ways, it’s our greatest strength.
  • In Brussels, the EU and U.S. resolved a 17-year dispute over aircraft subsidies on Airbus and Boeing, lifting the threat of billions of dollars in punitive tariffs on their economies in a boost to Transatlantic relations and I know welcome news to all of you.
  • We created the U.S.-EU Trade and Technology Council to write the rules of the road for the economy of the 21st century, particularly in emerging technologies.
  • And in Cornwall, the G7 agreed to a global minimum tax of 15% aimed at preventing major companies from moving operations to anti-democratic or low-tax havens. We must demonstrate to our citizens that there can be a just and transparent tax system in which everyone pays her fair share, even the biggest multinational corporations.

Here in Portugal, by some estimates, this new tax regime when implemented could increase Portuguese government revenues by 100 million euros per year — money that could be spent on health, social services or infrastructure.   A mutually reinforcing economic recovery is also the future of our U.S.-Portuguese and transatlantic relationships.

The Portuguese presidency of the European Council presidency is ending in exactly one week’s time, and it’s done a fantastic job, so congratulations.  The theme of the Portuguese presidency has been, “Time to Deliver:  A Fair, Green and Digital Economy.”   I’ve already spoken about fair – with human rights at the center of that word.  Let me spend a moment talking about digital, and green:

The Portuguese government, quite rightly, is keen on a digital transition to drive economic growth and recovery.   Our Embassy is in regular touch with Minister of the Economy and Digital Transition Pedro Siza Vieira to share ideas on these issues.   And we are delighted that American and British private sector investors are developing a €3.5 billion hyperscale data center an hour south of here, called SINES 4.0.  The project is expected to generate almost 1,000 direct jobs and 8,000 indirect jobs.  Once completed, Portugal will have the 2nd largest data processing capacity in all of Europe.  This project bolsters Portugal as a technology hub and is a strong symbol of the Transatlantic relationship.  Please note that this is a private sector development, not one by state-owned enterprises.  So while I was happy to get an invitation to the launch, the U.S. government does not control the project, get data from the project, or intervene.  All of us are believers in a free market economy, and this sort of project is at the center of that – supporting economic recovery on both sides of the Atlantic.

The 3.5 billion dollar project also plans to use green energy and the investors in fact chose Portugal over other countries because of Portugal’s commitment to a green future.  Our Commercial Service works constantly to make opportunities for investment in the United States well known to Portuguese and other Europeans, but we welcome increased U.S. investment here in Portugal, too.  We are, however, concerned with the recent decision of the Portuguese data protection authority (CNPD) involving Cloudflare and other U.S. technology companies that you may have heard about.  The consequences threaten to not only disrupt U.S.-Portuguese trade, but significantly affect Portugal’s economy, its digital transition — and ultimately its ability to attract U.S. and other foreign investment.

With a digital economy come the vulnerabilities of cyberattacks.  By some estimates there is a ransomware attack every 11 seconds, a 225% increase over the previous year.  After the Colonial Pipeline ransomware cyberattack, our entire government is focused on supply-chain integrity.  That is why last week President Biden put down our cyber red lines in his meeting with Putin.  No one is immune from this scourge.  Portugal has also seen a steady growth in organized cybercrime incidences, from phishing, fraud and targeted ransomware by both cyber criminals and state actors – again, a topic for our visiting Secretary of Homeland Security this week.  In fact, while he was here, we were able to bring experts from his agency and our Department of Justice to the Portuguese cyber coordinating authority, the Centro Nacional de Cibersegurança, to strengthen mutual cyber defense, resiliency and cooperation.  Our officials shared U.S. experiences and mitigation approaches to cyberattacks with Portuguese businesses and government leaders.

Now our contacts in the Portuguese government tell us that fast-growing Portuguese technology companies – four of them already $1 billion + unicorns – are the best Ambassadors for the United States.  Companies like Feedzai, Outsystems, Talkdesk and DefinedCrowd, which started in Portugal but expanded across the Atlantic have ‘Portuguese and U.S. DNA in them.’  At a conference, the CEOs said they are proud of their Portuguese heritage but would not have achieved their billion-dollar valuation without diving into the U.S. market, financing and its unique start-up and risk-taking ecosystem.  These growth stories are a powerful reminder of what happens when we mix our innovation and capital, generating jobs and investment across the Atlantic.  And this is only the beginning.  As our two nations race together to develop and deploy exciting emerging technologies, just this month President Biden nominated DefinedCrowd founder Daniela Braga to the National Artificial Intelligence (AI) Research Resource Task Force.  She will help design the U.S. road map for expanding access to critical resources and educational tools that will spur AI innovation and economic prosperity.  Portugal and the United States are working together at the cutting edge of what’s coming next.

What is so unique about entrepreneurship in the United States? It has to do with efficient laws, policies, and regulations to safeguard business interests, trade secrets, and ownership of ideas make the United States a fair and transparent place to do business.  These elements act as a necessary shield for technology enterprises, especially smaller startups.  Our way is diametrically opposite to the way China does business – which is through Intellectual Property theft, cyber espionage, forced technology transfers, trade and economic pressure, arbitrary detentions, and debt-trap diplomacy.  We share the EU and Portugal’s concerns about the PRC’s use of forced labor and internment camps in Xinjiang province, also for its economic and political benefit.

We applaud the European Parliament for voting overwhelmingly to freeze the ratification of the Comprehensive Agreement on Investment at a time when many capitals in Europe are raising growing concerns about Chinese investments on national security grounds.  In our view, China must commit to ending its non-market policies and provide transparency on how it will uphold its commitments to the global community.  And yes, that includes transparency on the origins of the COVID19 pandemic.

We know that Portuguese critical infrastructure is one of the top European targets for the Chinese government.  We continue to remain very concerned about China’s use of these investments as political and economic leverage – not just in Portugal, nearby Spain, or in Europe but in nations where democracy and good governance are more fragile, or still a work in progress.  Once again, I am referring to regions that both the United States and Portugal hold dear:  countries in sub-Saharan Africa and Latin America where Portuguese companies with strong Chinese shares in them are making inroads and asserting themselves. As we “build [our economies] back better” we want to do so in a way that preserves the free-market ideas that we share.

Other actors alas do not play by the rules, and their conduct threatens our collective security and prosperity.  We hold the same values with Portugal and our European friends and together need to defend those values. While our nation is not perfect, we are transparent and our flaws are open for all to see. We make efforts in fact to see them and to learn from them, as Alexis de Tocqueville said, “The greatness in America lies not in being more enlightened than any other nation, but rather in her ability to repair her faults.” We have learned so much recently about our country, and our current Administration is committed to repairing those faults and ensuring that we remain not only a stalwart democracy but the most prosperous, innovative, and open society on earth.  We want to go on this path with our European friends and partners.  That is why President Biden chose Europe as his first foreign destination and spent an entire week on this continent.  It is why we look to our European friends to discuss matters like the threats of Russia or the rivalry of China and realize that we are stronger and better when we confront these issues together.

Our two countries are clear about our major common challenges ahead. There are nearly a million and a half people of Portuguese origin in the United States and over a million American tourists came to visit Portugal in 2019 before the pandemic struck. We need to keep fighting the pandemic, with all its dangerous and unpredictable twists and turns, so we can recover these precious travel routes and all the meaning and economic value they carry with them.  Second, the United States is impressed by Portugal’s leadership in dealing with the climate crisis through the outstanding speed of its energy transition and by being a top advocate for this cause within the European Union and globally. The United States is committed to net zero greenhouse gas emissions no later than 2050, while the EU will cut its emissions by at least 55% compared to 1990, with a frontrunner. The United States is excited about the 2022 UN Ocean Conference in Lisbon and do its best to make it a landmark moment in propelling science-based innovative solutions to start a new chapter of global ocean action. Overall, we want to work together on the climate emergency and on coordinating how best to protect and advance the critical supply chains needed for the energy transition to be a success, including in electric batteries, critical materials and minerals – three priority products that play to Portugal’s strengths.

Portugal is close to surpassing the number of days living under democracy than the time under the Estado Novo dictatorial regime. It will be my personal privilege to witness and share that moment as a U.S. diplomat in your country. In his recent ‘25 de Abril’ speech, President Marcelo Rebelo de Sousa, very eloquently stressed that “development, freedom and democracy have always been imperfect and, therefore, never complete.” The protection of our democracies demands constant effort. This is why President Biden and my more direct boss, the U.S. Secretary of State Tony Blinken set as a priority to work with the world’s democracies on how best to combat threats to our free societies. The challenge is great, as the integrity of our democratic lives will be determined by more than how well each of us secures our national ‘checks and balances’ sovereign systems. Democracies – including Portugal and the United States – must come together to shape the international rules that will govern the advance of technology and the norms of behavior in cyberspace, artificial intelligence, and biotechnology so to ensure democratic values are honored rather than having this technology utilized for repression. And we must stand up to the economic abuses and coercion that undercut the foundations of the international economic system.

Thank you very much.