Caterpillar’s Owens Calls Move Toward Protectionism a Great Danger to the Global Economy

Speech at National Manufacturing Week Conference Encourages Open Engagement With China Rather Than Unilateral Sanctions

March 22, 2006. Rosemont, Ill. - Citing positive economic conditions in the United States and around the globe, Caterpillar Inc. (NYSE: CAT) Chairman and Chief Executive Officer Jim Owens today called on policymakers to reduce anti-trade rhetoric and instead focus on keeping U.S.-China relations positive and constructive. Owens made his remarks as the keynote speaker at the 2006 National Manufacturing Week, which is sponsored by The National Association of Manufacturers.

"Personally, I can think of no faster path to a worldwide recession than for the twin engines of the global economy — the United States and China — to turn against one another," said Owens. "Both countries need to make an extra effort to ensure that we treat each other with mutual respect. Rather than threatening protectionism, leaders must redirect their energies toward improving competitiveness and opening markets," he added.

Owens specifically called on U.S. lawmakers to reject legislative proposals to impose tariffs on Chinese imports. Instead, he suggested that China would be more responsive to the trade concerns of the United States if China had a greater role in multilateral organizations such as the G-8, The International Energy Agency and The International Monetary Fund.

A Ph.D. economist, Owens has been Caterpillar's Chairman and CEO for two years. During those years, Caterpillar posted record sales and profits, increased its global workforce by more than 20 percent and maintained its position as a leading net exporter, with more than $9 billion in Caterpillar products exported from the United States in 2005.

In the last few years, Caterpillar has more than doubled its workforce in China and significantly expanded sales in China. At the same time, Caterpillar's U.S. exports to China have increased by 40 percent—helping to create more than 5,000 new production jobs at Caterpillar's U.S. based facilities.

"I'm optimistic about the future of U.S. manufacturing. We have our challenges, but they are no more formidable than those we've overcome in the past," Owens said. "The recipe that has made Caterpillar a successful manufacturer in the global marketplace can be used by others. It is made up of three key ingredients: designing and producing innovative, high-quality products, embracing lean manufacturing processes to drive efficiency, and investing in educational and workforce development for the people who make up our companies," Owens said.

For more than 80 years, Caterpillar Inc. has been building the world's infrastructure and, in partnership with Cat dealers, is driving positive and sustainable change on every continent. With 2005 sales and revenues of $36.339 billion, Caterpillar is the world's leading manufacturer of construction and mining equipment, diesel and natural gas engines and industrial gas turbines.

Owen's NAM - English

Owen's NAM - Chinese