137 



grams. Personnel hiring requirements emphasize analytical class- 

 room experience rather than marketing skills and private sector 

 training or experience. The design and administration of marketing 

 programs is in the hands of compliance personnel. 



The bulk of the most useful reporting from FAS/field offices re- 

 mains intemsd and classified and thus off limits to those who could 

 most effectively benefit from it. The best customers for FAS crop 

 reports and circulars are our competition today. 



Our recommendation would be, analyze the respective strengths 

 of industry and Government organizations and create a partnership 

 based on these strengths. For example, make sure analysis sup- 

 ports efforts in trade policy and marketing. Ideally, industry groups 

 and cooperators should take the lead in marketing while FAS/ 

 USDA concentrates on analysis and improving market access. 



To ensure overall coordination within the partnership, USDA 

 and FAS should consider stationing personnel in the home or over- 

 seas offices of industry cooperators. In this way, USDA can develop 

 a sense of accountability to its constituency while simultEineously 

 training its personnel in the technical and marketing nuances of 

 each commodity. 



The function of overseas FAS staff should complement the mar- 

 keting programs of the industries. 



In terms of program focus, there is no need to reiterate the grow- 

 ing importance of becoming more aggressive in promoting value- 

 added products. With GATT limiting the ability to subsidize bulk 

 commodities, greater emphasis will have to be placed on increasing 

 the U.S. market share in the value-added trade. Currently, the 

 funding of programs which dispose of surplus commodities exceeds 

 that of programs which build new markets for new products by ten- 

 fold to twentyfold. And in foreign markets, it shows. 



Currently, the United States is a residual player in the growing 

 value-added export market. Despite the fact that it is a world lead- 

 er in terms of efficient production of these foods, only 10 percent 

 of what we export is value-added. 



Lastly, success in the international marketplace will require a 

 service mentality to our foreign customer. I think the potential ex- 

 ists for retooling the current relationship between the Grovemment 

 and industry. Most importantly, the partners must view each an- 

 other as team players, not adversaries. 



The object of both parties' focus should be on the existing or po- 

 tential foreign customers of our products. In the highly competitive 

 environment of the international marketplace, industry and Gov- 

 ernment cooperation is vital to remaining competitive and captur- 

 ing increasing share in the growing market. 



Given the fact that these relationships are the norm for our com- 

 petition, and that the United States is burdened with a promotion 

 resource handicap, the sjnnergy of the industry/Government rela- 

 tionship may be the penultimate factor defining future U.S. com- 

 petitiveness in future agricultural trade. 



Thank you very much for soliciting our views on this important 

 topic. 



[The prepared statement of Mr. Seng appears at the conclusion 

 of the hearing.] 



Mr. Penny. Thank you. 



