In a hearing before the House Small Business Subcommittee on Agriculture, Energy & Trade on Tuesday, Assistant U.S. Trade Representative James Sanford testified on the benefits of the 20 free trade agreements currently in force and reiterated USTR’s commitment to reaching conclusion on agreements on the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP). His testimony echoed the NAM’s long-held position that FTAs are a proven and effective way to remove trade barriers and create new markets for American products. The evidence is clear: manufactured goods exports increased 47 percent from 2009 to 2012, reaching a record $1.35 trillion in sales in 2012. Nearly 50 percent of those goods were sold in FTA partner countries. Trade is vital for the future growth of manufacturing in the United States.
In his opening statement, Subcommittee Chairman Richard Hanna (R-NY) noted that his home state of New York exported over $81 billion in goods – supporting thousands of good paying jobs. Trade agreements are particularly important to small and medium sized manufacturers, who comprise 97% of all manufacturing exporters according to a 2013 report from the U.S. Census. Trade agreements make it significantly easier for companies to access foreign markets by eliminating tariffs, increasing transparency in customs and regulatory processes, and providing strong intellectual property protections.
During questions from the Subcommittee, Sanford stated that USTR consistently hears from small and medium sized companies who lack the in-house resources to comply with foreign regulatory or documentation requirements. USTR is seeking to address this problem and other non-tariff issues that disproportionately impact small companies in the TPP and TTIP negotiations. Sanford also mentioned that the U.S. International Trade Commission will be releasing a report on these barriers in February that USTR will use as guidance. The NAM submitted comments to ITC on those barriers.
Sanford pointed out that in order to actively and effectively pursue these goals, the Administration will need Trade Promotion Authority (TPA). The NAM has made TPA a top priority and is calling for swift passage of bipartisan TPA legislation that was introduced earlier this month.
When Chairman Richard Hanna asked Sanford when stakeholders could expect a deal on TPP, Sanford said he thought an agreement would be reached early this year, but that “the substance will drive the timetable. It’s more important that we get the agreement right and the provisions we are pressing for.” The NAM agrees with this point – any final agreement needs to have strong outcomes that open markets, concretely eliminate tariff and non-tariff barriers, and set in place strong rules on intellectual property, investment, cross-border data movement, and other standards that are all fully enforceable for all industries. That type of outcome will help sustain and grow U.S. manufacturing and the jobs it supports throughout the United States.