Tracking trade as Oregon exports continue to grow
Editor's note: This month's column is written by Maria Ellis, who is the executive director of the Pacific Northwest International Trade Association (PNITA) and the director of federal affairs at the Portland Business Alliance.
This month, the Portland Business Alliance, along with our colleagues at the Oregon Business Plan, led a group of more than 40 Oregonians, including public officials, businesses representing a variety of industries and elected leaders, to Washington, D.C. to meet with our congressional delegation.
Through our discussions, the spotlight quickly shifted to trade, particularly the United States-Mexico-Canada Agreement (USMCA). Due to differing perspectives on trade within Congress right now, our delegation has a critical and outsized role to play on shaping national trade policy. Their votes matter.
Oregon is fortunate to have a congressional delegation that understands the importance of trade for our economy. With more than one in every five Oregon jobs being trade dependent, our fortunes rise and fall with what's happening on the global trade policy stage.
That is why all of us must support our delegation when the USMCA is considered by Congress later this year. If not ratified, the United States would revert back to pre-free trade agreement conditions, which would throttle economic growth, dampen wages, and cut off markets for our products. The existing agreement facilitated more than a tripling of trade between signatories , and Oregon's exports to Canada and Mexico have increased by 260%. In all, about 154,000 Oregon jobs are supported by trade with our direct neighbors, totaling around $3.9 billion in goods and services.
Because trade is such a critical issue, the Portland Business Alliance is reinvesting in the Pacific Northwest International Trade Association (PNITA) with a goal of having it serve as a platform for education and advocacy on trade-related issues. There exists a fantastic cadre of businesses and organizations directly or indirectly working in the trade space — companies like Nike and Tillamook, and organizations like the Port of Portland, the Global Markets Centers and Business Oregon, to name a few. However, none hold the singular mission of education and advocacy. As the new executive director of PNITA and federal affairs director for the Alliance, my goal is to help amplify this good work and to be a consistent voice for how free trade is closely connected to economic prosperity for all of us living in the Pacific Northwest.
Earlier this month, Oregon had reason to celebrate when we learned that our international exports grew nearly 2%. The increase may not seem huge, but it provides confidence in future global opportunities for Oregon products. We're approaching this good news with cautious optimism, not ignoring how the shifting ground on global trade may yet impact our region.
Two important trade agreements signed in 2018 will impact future exports in Oregon, especially in agriculture. When the U.S. chose to withdraw from the Trans Pacific Partnership, the world went on without us, with 11 countries signing onto the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and Japan entering into an additional separate agreement with the European Union.
Under the umbrella of these agreements, partner countries will benefit from tariff reductions that will put Oregon farmers at a disadvantage in export markets they have worked decades to cultivate, particularly in Japan and China.
And there's the vital issue of trade with Mexico and Canada, currently referred to as the USMCA. The president has repeatedly threatened to withdraw from the existing free trade agreement, one that — while not perfect — has benefited Oregon agricultural and manufacturing industries, which are core to our state's economy. The administration has worked with Canada, Oregon's second-largest export market, and Mexico, Oregon's 14th-largest export market, to negotiate the USMCA, which has been signed by all parties but has yet to come before Congress for ratification.
Thus far, the USMCA appears to be strikingly similar to the current agreement but with some modest, yet important, improvements, including increased access for U.S. poultry and dairy commodities, more protections for intellectual property, and improved rules of origin to support U.S. manufacturing. There are also provisions to improve labor practices such as a minimum hourly wages of $16/hour by 2023 on certain manufacturing and more protections for workers' right to organize.
The USMCA's proposed length of proprietary protections on pharmaceutical biologics is sure to be a sticking point for some policy makers as it will only compound the drug pricing problem in the U.S.
The real question for many is how these provisions will be enforced to realize these improvements. There is talk of the administration considering tariffs as a stick to enforce the more progressive and welcomed aspects of the agreement — at least by the U.S. — but that could take us down the same tit-for-tat tariff road we currently find ourselves on with China.
Oregon's role as a leading global trade partner must remain strong.