clock menu more-arrow no yes

Filed under:

Guest opinion: How the new trade pact with Mexico and Canada benefits Utah

President Donald Trump, center, shakes hands with Canada’s Prime Minister Justin Trudeau as Mexico’s President Enrique Pena Nieto looks on after they signed a new United States-Mexico-Canada Agreement that is replacing the NAFTA trade deal, during a cerem
President Donald Trump, center, shakes hands with Canada’s Prime Minister Justin Trudeau as Mexico’s President Enrique Pena Nieto looks on after they signed a new United States-Mexico-Canada Agreement that is replacing the NAFTA trade deal.
Martin Mejia

The evidence in favor of free trade is clear and overwhelming. Trade that is free and reciprocal lowers prices for consumers, improves the quality of goods, spurs innovation and creates wealth for families of all income levels. Free trade also generates the abundance to help retrain and reposition those whose jobs are dislocated by an ever evolving economy. That’s why we support the U.S. Mexico Canada Trade Agreement, or USMCA, and strongly encourage congressional leaders to approve the agreement as soon as possible.

Here are the facts. Thanks to the success of the North American Free Trade Agreement over the past 25 years, trade with Canada and Mexico already supports 12 million jobs nationwide. In Utah, more than 121,000 jobs depend directly on trade with our two North American neighbors, and indirectly we all benefit from lower costs and higher quality.

NAFTA has been a case study in how trade grows the economy. But even good agreements require modernization. The USMCA offers important updates to NAFTA: better protections for intellectual property, increased access to the Canadian market for Utah’s farmers and a higher threshold for duty free exports to Canada. The latter is an important win for Utah’s thousands of small online businesses who want to sell low-cost products without being dinged by Canadian tariffs.

Utah’s farmers, manufacturers and exporters understand these benefits well. Ron Gibson, a dairy farmer who is also president of the Utah Farm Bureau Federation, sees​ ​passing USMCA as a big win for local farmers. Ron says his family farm in Ogden is facing “the toughest times we have ever seen,” and the “answer to this problem isn’t just drinking more milk, buying more vegetables or eating more hamburgers here in America.” According to Ron, “The answer is expanded market opportunities through trade. Passing the USMCA would give farmers like me a sense of stability that would allow us to create smart business plans for the future.”

Utah manufacturers also understand the importance of strengthening trade between our three countries. According to Todd Bingham, president and CEO of the Utah Manufacturers Association, “Canada and Mexico purchase more U.S. manufactured goods than our next 11 trading partners combined. One out of six Utah manufacturing firms export to Canada and Mexico. Trade is extremely important — helping Utahns sell more of what they make to customers around the world. Congressional passage of the United States-Mexico-Canada Agreement will help Utah manufacturers grow and compete globally, supporting thousands of well-paying manufacturing jobs across the state.”

Canada and Mexico are also the top two export destinations for U.S. small and medium-size businesses. In fact, many of Utah’s start-ups and small businesses enter the international market first through Canada and Mexico and then grow their markets from there. For all Utah’s exports, Canada is our second largest market; Mexico is our fifth. Last year alone, Canada and Mexico bought almost $2.7 billion of Utah’s exports (including vehicles, electrical machinery, electrical appliances and other manufactured goods).

Approval of USMCA will help lock in this growth, preserve all current trade benefits and ensure Utah manufacturers, farmers, and exporters can continue to access Canadian and Mexican markets. The new pact guarantees that nearly all U.S. exports will enter these markets tariff-free. That means Utah goods can continue to cross borders without additional penalties so that companies receive the maximum benefit from their labor and investment.

And it means jobs! USMCA will help ensure those benefits are ultimately passed on to their workers, customers, their families and communities.

The benefits of USMCA do not end with lower trade barriers. The agreement also modernizes protection for our intellectual property, securing stronger protections for patents, copyrights and trademarks. It will include strong enforcement tools against counterfeiting and piracy, allowing Utah’s entrepreneurs to benefit more fully from their creativity and intellectual property when they export to Canada and Mexico.

We’re grateful that Sens. Mitt Romney and Mike Lee and Reps. Rob Bishop, Chris Stewart, John Curtis and Ben McAdams each agree and have committed to support the USMCA when congressional leaders put it to a vote.

We’re also hopeful the federal government can resolve other ongoing trade discussions. In particular, we are eager to see the Trump administration quickly bring trade discussions with China to a productive resolution. We commend the administration for addressing China’s unfair trade practices, including its long-standing and rampant theft of intellectual property, but we’re concerned that miscommunication and brinkmanship are prolonging the battle and harming Utah’s farmers, ranchers, energy producers and manufacturers. We encourage both sides to communicate clearly and resolve the differences promptly.

Trade is critical to Utah’s future. Last year Utah businesses exported $14.4 billion worth of goods to the rest of the world. Those exports came from more than 3,500 companies, most of which are small businesses. And those aren’t just numbers — that free flow of goods makes our lives better. It makes the things we buy cheaper and better, it unlocks new technologies, it gives us the bounty to help those in need and it gives our kids a brighter future. In Utah we love trade and we’re open for business. We hope Congress will agree.

Gov. Gary Herbert is the governor of Utah. Derek Miller is the president and CEO of the Salt Lake Chamber. Miles Hansen is the president and CEO of World Trade Center Utah.