President Barack Obama last year set a goal of doubling U.S. exports within five years. If our country is to reach that goal, one tool is to achieve lower tariffs on our goods and services. And one way to do that is to approve the three trade agreements that have been stuck in Congress for the past four years.
The most important one economically is the agreement with South Korea, the world’s 12th-largest economy. Last year, Nebraska exported some $271 million worth of goods and services to that country, up from $149 million in 2008 and $64 million in 2005.
Among Nebraska’s top export destinations, South Korea ranks No. 5. Nebraska exports almost as much to South Korea as to China.
The U.S. International Trade Commission says that if Congress approves the agreement with South Korea, U.S. exports to that country would increase by a projected $11 billion.
As for the agreement with Colombia, the American Farm Bureau estimates that it would increase U.S. farm exports by more than $690 million annually.
In 2009, Sam Carney, an Iowa farmer then serving as president of the National Pork Producers Council, testified before Congress that approval of the trade agreement with Panama would be worth around $23 million in additional revenue for U.S. pork producers. The agreement would end immediately an array of barriers, including agricultural tariffs up to 70 percent on beef and pork, 90 percent on grain and 260 percent on chicken.
U.S. Rep. Adrian Smith of Nebraska’s 3rd Congressional District has been outspoken in advocating passage of the agreements, noting the importance for the state’s ag sector. Leaders with the Nebraska Farm Bureau were in Washington, D.C., this spring to urge passage of the agreements, above all the one with South Korea.
Trade policy analyst Ed Gresser notes that the export economy was particularly important in facilitating U.S. growth in 2010. He writes: “Rising exports accounted for half of last year’s economic growth. In more precise terms, exports added 1.34 percent in gross domestic product growth (half of the 2.9 percent total). This was the largest contribution exports have made to growth since 1946.”
Here are some highlights he mentioned: “An additional half-million exports of cars (with sales to China passing the 100,000-car mark for the first time, from a meager 215 cars in 2000); a jump from $98 billion to $117 billion in farm exports, close to double their $63 billion level of 2005 and featuring jumps of $2.6 billion in cotton, $800 million in cowhides, $400 million in almonds and $140 million in salmon; big jumps too in sales of medicines and hospital equipment to Brazil; semiconductors and other IT goods in Korea and Taiwan; earth-moving and drilling equipment to Panama, Colombia, Chile and Peru, etc.”
It’s a gigantic global market out there, with great potential for a wide array of U.S. producers and companies. Let’s seize the opportunities.