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Free Trade Is Vital To Missouri’s Economy
March 10, 2018
St. Louis Post-Dispatch
One of my top priorities as lieutenant governor has been promoting Missouri businesses through the Buy Missouri program, highlighting the numerous products from dog food to windows that are produced in communities across our state.
While Buy Missouri thus far has focused primarily on promoting domestic consumption of locally produced goods, I also realize that the ability to freely access international markets is important for Missouri’s many small businesses and agricultural producers.
About 95 percent of consumers’ and 80 percent of the world’s purchasing power are located outside our nation’s borders. We can’t grow by selling only to domestic customers; our economic success depends on being able to reach the massive number of consumers around the globe and find new markets for Missouri-made products.
This is why international accords like the North American Free Trade Agreement are so important. These agreements allow Missouri farmers, ranchers and businesses to sell goods on an even playing field and reach new customers around the world, without having to worry about protectionist tariffs or nonsensical regulations getting in the way.
Because of free trade, producers across Missouri can compete at a global level, and — due to the quality and variety of goods our state produces — we have become very successful at exporting. As of 2016, the Department of Commerce reported that nearly 85,000 jobs across Missouri are supported by the export economy.
These are jobs in every corner of our state, from farms to factories, in cities large and small. The impact goes beyond just big multinational companies: Data show that 85 percent of Missouri companies exporting goods internationally are small- to medium-sized businesses.
The statistics are absolutely staggering. In the agriculture industry alone, $3.6 billion in economic activity was generated through international exports during 2015 — $1.1 billion in soybeans, $331 million in corn, $248 million in pork, and $107 million in beef, among other agricultural products.
Our success marketing goods to consumers outside of our borders has played a big role in allowing Missouri’s agricultural industry to grow and thrive. Our state’s farmers are not just putting food on plates across America; we are feeding people around the world. Now, we are the third-largest producer of beef cattle in the nation, the seventh-largest producer of hogs, ninth-largest for soybeans, and 10th-largest for corn, and our agriculture industry grows more every year because of the significant demand for Missouri-made agricultural products.
However, without ready access to international markets via agreements like NAFTA, our ability to export goods would be seriously compromised and our economy would suffer.
Data from 2014 show that trade generated through free trade agreements is responsible for 59 percent of our state’s international merchandise exports — a total impact of $8.4 billion every year, dependent on the vital partnerships our nation has been able to cultivate through mutually beneficial trade agreements.
Our largest trading partners by a country mile are the two other member nations of NAFTA: Canada, which purchases $4.7 billion of goods from us every year, and Mexico, which purchases $2.3 billion. This is a huge economic impact for just one program to have: $7 billion per year. To me, this makes one thing crystal clear: Missouri’s economic future is clearly and unavoidably tied to the future of NAFTA.
The economic importance of maintaining strong trade relations with our two closest neighbors cannot be overstated. Any decision negatively affecting the free flow of trade from Missouri to Canada and Mexico would have undesirable economic consequences. Thousands of jobs and billions of dollars are at stake.
Missouri’s economic growth depends on access to international markets for exports, and that is why it is so vital for our nation to maintain free trade agreements. Our nation may occasionally disagree on specific provisions in free trade agreements, but the answer is to negotiate solutions that will update existing agreements and allow us to maintain free trade.
Mike Parson, a Republican, is the lieutenant governor of Missouri.
To access the op-ed, click here.