Officials: USMCA Expected To Benefit Arkansas’ Economy

WASHINGTON, D.C. — The U.S. House of Representatives voted Thursday, Dec. 19, to approve a new trade deal with Canada and Mexico that Arkansas officials say will spur higher economic growth in Arkansas and internationally.

The United States-Mexico-Canada Agreement, or USMCA, passed 385-41, according to the Associated Press. The bill now heads to the Senate, where it likely won’t be voted on until after the new year, AP reported.

Rep. Steve Womack, R-Rogers, said the legislation provides a “strong framework” for job creation.

“This agreement will boost our economy and support Arkansas’s farmers, ranchers, producers, workers, and manufacturers,” Womack said.

“The Natural State is open for business, and greater market access with two of our top trading partners will further unleash opportunity and success across all sectors.”

Canada and Mexico, respectively, were Arkansas’ top two trading partners in 2018, according to data compiled by the World Trade Center Arkansas.

The two countries accounted for $2 billion in goods and support 120,000 in-state jobs, said Melvin Torres, trade director for the Western Hemisphere at the World Trade Center Arkansas.

“After years of consistent growth in exports from Arkansas to Canada and Mexico, long-term data has shown that a more modern trade agreement will exceedingly propel the state’s economy,” Torres said.

If signed into law, USMCA will replace the North American Free Trade Agreement, or NAFTA, which was signed into law in 1994. The landmark agreement removed numerous trade barriers between the three nations, according to the AP. Since NAFTA’s implementation, Arkansas’ exports to Mexico have increased by more than 700% compared to just 300% with the rest of the world.

“In other words, Arkansas’ export growth rate to Mexico has been 2.3 times higher compared with the rest of the world,” Torres said.

Arkansas also holds a unique position within the agreement, Torres added, as data shows we export more than what we import from both countries combined over the past years.

“Let’s not forget, Canada continues to be Arkansas’ largest export partner and there is an analytical, data-driven reason for all this, a free trade agreement since 1994 that will now be updated through the USMCA.”

USMCA also won approval from Arkansas’ three other U.S. Representatives, including French Hill, R-Little Rock, who spoke on the House floor during the historical debate and praised the agreement on Twitter:

USMCA sets the stage for billions more in U.S. economic activity and strengthens our hand as we negotiate new trade deals with China, the United Kingdom, and other global partners.

An exact date hasn’t been set for the Senate to vote on USMCA. However, earlier this year, Sen. John Boozman, R-Arkansas, cited the Center’s report while advocating for the agreement’s approval in the House.

“The (center’s report) underscores just how crucial Canada and Mexico are for Arkansas’ economy,” said Boozman, who helped establish the center in Rogers in 2007.

“Combined, these two countries account for a third of Arkansas’ total exports,” Boozman added.

The mission of the World Trade Center Arkansas is to grow trade and increase Arkansas exports by connecting Arkansas businesses to the world through international trade services.

The center is part of the University of Arkansas and serves as the trade promotion arm for the Arkansas Economic Development Commission. For more information and valuable updates, please follow the center on Facebook and Twitter or subscribe to the World Trade Center Arkansas newsletter.