William J. Canary: Trade Legislation Critical to Alabama Economy

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After years of inaction and gridlock in Washington, Congress is poised to do something big: pass legislation that is not only bipartisan but also has the potential to unleash new opportunities for Alabama employers and workers. The legislation, known as Trade Promotion Authority (TPA), lays the groundwork for the United States to finalize new trade deals that open up foreign markets to U.S. goods and services.

While the legislation is about international agreements, it has a big impact here in Alabama. To understand what the benefits of new trade agreements could bring to our communities, let’s take a look at what trade already means.

International trade – including exports and imports – currently supports more than 550,000 Alabama jobs, more than one in five. In 2013 alone, Alabama businesses – 82 percent of which are small- and medium-sized businesses – exported more than $23 billion in goods and services to countries around the globe. On top of that, jobs related to exports pay up to 18 percent higher wages, so a quick look at the numbers makes it pretty clear that international trade has been good for Alabama.

Free trade agreements (FTAs), negotiated under past TPA legislation, have been a critical factor in unleashing these benefits. Without FTAs, Alabama businesses often face barriers to entry and high tariffs that make it difficult to sell their products overseas. These barriers are especially difficult for small businesses to overcome. FTAs eliminate barriers, making it easier for our businesses to sell their products to customers around the world.

To get a feel for how trade agreements have opened the door to Alabama exporters, consider this: in 2013, FTA partners purchased 11.5 times more goods per capita from Alabama than non-FTA partners. Consider also that Alabama’s more than 3,800 manufacturing firms export 47 percent of all their manufactured goods just to the 20 countries with which the United States has negotiated FTAs, even though those countries represent only 10 percent of the world economy.

A majority of Alabama’s House delegation – U.S. Reps. Bradley Byrne, R-Daphne, Martha Roby, R-Montgomery, Mike Rogers, R-Saks, and Terri Sewell, D-Birmingham – demonstrated continued support for Alabama manufacturers by voting in favor of TPA legislation.

This is an opportunity not just for Washington to prove to folks here in Alabama and across the country that Congress can work for the American people, but also that the work they do can bring real benefits to employers and workers across the country.

 William J. Canary is President and CEO of the Business Council of Alabama, a statewide business advocacy organization and the exclusive representative in Alabama to the National Association of Manufacturers and the U.S. Chamber of Commerce.

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