New international trade agreements are a big deal
Washington, DC, February 11, 2020
By: Representative John Carter
Originally appeared: Round Rock Leader, Feb. 11, 2020
The United States over the last month has negotiated and secured two revolutionary trade agreements: the United States-Mexico-Canada Agreement and “Phase 1” of a trade deal with China. These trade agreements come after a focus on free and fair trade by the Trump administration.
With the U.S. reasserting its economic dominance on the world stage, there has never been a better time to renegotiate our archaic and unfair trade agreements. Now, after decades of trade practices that took advantage of American workers and innovators, U.S. leaders are finally taking the necessary steps to prioritize and fight for the Americans they represent.
I can’t stress this enough: these trade agreements are a big deal. American workers and business owners from all walks of life are positioned to benefit from these deals in trade policy. But with so many in the media focused on impeachment, speech ripping and party fighting, coverage of the new trade deals has been limited.
So, what benefits should Americans expect to see? Well for starters, the president’s signature on these two agreements means we now have modernized trade agreements with our top three trading partners, accounting for nearly $1.7 trillion dollars in trade annually. This is huge progress, especially since the U.S. has never had a trade deal with China — our largest trading partner.
The most significant win from the Phase 1 deal resolves two of the biggest problems American companies have experienced while conducting business in China: intellectual property theft and forced technology transfer.
In the past, Chinese businesses faced little to no repercussions from the theft of American companies’ secrets, and the Communist-controlled government hasn’t been much better, often forcing American businesses to exchange technology for access to Chinese markets. The Phase 1 agreement will finally protect American innovation and intellectual capital.
Among other wins, U.S. manufacturing, agriculture, energy and service industries will be working overtime to meet the demand for an increase in Chinese purchases. Before the start of the U.S.-China trade war, the U.S. was only exporting around $130 billion in goods to China. With the Chinese in a far worse position to negotiate due to unprecedented economic success in the U.S., and poor economic performance by China, they have now committed to increasing imports of U.S. products, energy and services by more than $200 billion.
On the Western Hemisphere, the USMCA will replace the outdated North American Free Trade Agreement, or NAFTA. That agreement between the U.S. and her neighbors was implemented in 1994, when iPhones, e-commerce and the digital age were nonexistent. With such dramatic change to the world’s economy, an updated agreement was necessary
Much like the Phase 1 deal, the USMCA expands market access by eliminating barriers to entry, such as tariffs that have targeted U.S. producers. A healthy economy is dependent upon a free market. With 12 million American jobs supported through trade with Mexico and Canada, a deregulated market will add another 176,000 jobs and $68 billion in new economic growth.
The signing of the USMCA and Phase 1 deal is great news, and we should all prepare for continued American prosperity and excellence.
Rep. Carter represents Texas District 31, which includes Round Rock and Fort Hood, the largest active-duty armored military installation in the free world. He serves as co-chairman of the Congressional Army Caucus and Chairman of the Military Construction and Veterans Affairs Subcommittee on Appropriations.