Making sure U.S. businesses—from light manufacturers to service providers—benefit from higher growth, employment and wages due to increased exporting is key to expanding the economy and creating opportunity for all Americans.
As U.S. Commerce Secretary Penny Pritzker pointed out at the beginning of May—World Trade Month—96% of customers for U.S. businesses live outside the country, so increasing exports will enable companies to “expand and hire here at home.”
That is one reason Secretary Pritzker kicked off World Trade Month 2015 by, as the U.S. Department of Commerce put it, “reiterating the government’s commitment to promoting international trade as part of the country’s business strategy to diversify and continue advancing the nation’s economic resurgence.”
As we near the close of the nationally observed World Trade Week, May 17–23, international trade is a continuing bright spot in the economic landscape, with export markets providing advantages for both California and the United States.
U.S. exports reached a record high for a fifth consecutive year in 2014, totaling $2.34 trillion and supporting more than 11.7 million jobs.
In 2014, California exports totaled $174 billion, according to the U.S. Department of Commerce. This is an increase from the 2013 total of $168 billion.
California maintained its perennial position as a top exporting state, exporting to 229 foreign markets. Exports from California accounted for 10.7% of total U.S. exports, with Mexico, Canada, China, Japan and South Korea being the state’s top trading partners.
Trade Promotion Authority
Secretary Pritzker commented that World Trade Month “recognizes and celebrates international trade but also raises awareness of the varied services the U.S. government provides” to small and medium-sized enterprises.
Central to the President’s “ambitious trade agenda that will open up more markets to ‘Made in America’ goods and services,” Secretary Pritzker said, “is the passage of trade promotion legislation and the enactment of strong trade agreements that uphold our values. These agreements are essential to the continued growth of our economy, the creation of good American jobs, the economic security of our families, as well as our nation’s competitiveness and national security.”
The California Chamber of Commerce is supporting legislation introduced in Congress to renew the authority of the President and/or U.S. Trade Representative to negotiate trade agreements. Passage of trade promotion authority will help Congress and the President to work together to forge new and beneficial trade agreements for the United States.
Agreements like the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP), multilateral agreements currently being negotiated, ensure that the United States may continue to gain access to world markets, which will result in an improved economy and additional employment of Americans.
All trade agreements are critical elements of the U.S. strategy to liberalize trade through multilateral, regional and bilateral initiatives. Passage of these agreements means the elimination of billions of dollars in tariffs for U.S. exports, as well as increased market visibility and benefits to California and the United States as a whole.
Through the TPP, the United States is seeking to help establish a trade and investment framework that supports job creation, promoting competitiveness, and expanding trade in the dynamic Asia-Pacific region. The United States also is seeking to advance core U.S. values in the agreement, such as transparency, labor rights, and environmental protection.
The TTIP is a key driver of global economic growth, trade and prosperity, and represents the largest, most integrated and longest-standing regional economic relationship in the world.
Together, the European Union and the United States are responsible for 11.5% of the world’s population, 45% of global gross domestic product, 30% of global merchandise trade, and 40% of world trade in services. A trade agreement could increase economic output for both the United States and the European Union.
For more than half a century, the United States has led the world in breaking down barriers to trade and in creating a fairer and freer international trading system based on market economics and the rule of law. Increased market access achieved through trade agreements has played a major role in our nation’s success as one of the world’s leading exporters.
The CalChamber supports expansion of international trade and investment, fair and equitable market access for California products abroad, and elimination of disincentives that impede the international competitiveness of California business.
Our competitive success in the global economy forms the foundation for California and the nation to remain world leaders.
Susanne Stirling is vice president of international affairs at the California Chamber of Commerce.