ROGERS — Arkansas’ economy could blossom under the United States-Mexico-Canada Agreement, the landmark trade deal approved Thursday, Jan. 16, by the U.S. Senate, according to an analysis by the World Trade Center Arkansas.
The Senate passed the bill, also known as USMCA, by a wide margin, 89-10, according to the Associated Press. The bill now heads to President Donald Trump, who is expected to sign it into law. USMCA will replace the North American Free Trade Agreement, or NAFTA, which was signed into law in 1994. NAFTA removed numerous trade barriers between the three nations, according to the AP.
Canada is Arkansas’ first and largest export market, accounting for $1.2 billion in trade in 2018, according to data compiled by the Center. Furthermore, since NAFTA’s implementation, Arkansas’ exports to Mexico have increased by more than 700% compared to just 300% with the rest of the world. Combined, Canada and Mexico supported 120,000 in-state jobs in 2018.
“After 26 years of consistent growth in exports from Arkansas to Canada and Mexico, long-term statistical data has shown that this more modern trade agreement will exceedingly propel the state’s economy through our two largest export partners,” said Melvin Torres, the Center’s trade director for the Western Hemisphere.
“This strong symbiotic relationship with both countries is fostered by true partnership, which correlates with quantitative trends showing exports to both markets will continue growing for Arkansas through updates on the new (USMCA),” Torres said.
Torres added that Arkansas is in a unique position as data show the Natural State exported more than it imported from both countries combined over the past years
“Arkansas knows how to sell through small businesses and farmers which account for 80% of the companies that export in Arkansas and are the backbone of our State’s economy,” Torres said.
Sen. John Boozman, R-Rogers, who helped establish the Center in 2007, voted in favor of USMCA, calling it a “historic agreement.”
“Passage of USMCA ensures Arkansas agricultural producers, manufacturers and small businesses have a level playing field to compete in the global market,” Boozman said, citing Center data. “I’m pleased we are able to deliver this economic accomplishment for hardworking Americans.”
Arkansas Farm Bureau, advocacy group made up of nearly 190,000 member families, also celebrated the announcement.
“It’s about time we have this agreement ratified,” said Rich Hillman of Carlisle, AFB president. “Passage of USMCA will help stabilize the marketplace and will allow the United States to focus efforts on other important trade agreements around the world.”
Agriculture provides more than $20 billion annually to Arkansas’s gross state product, with roughly one-third of production from Arkansas designated for the export market, according to AFB.
Canada has yet to ratify the deal, although Prime Minister Justin Trudeau intimated he was waiting on U.S. approval before proceeding, the AP reported. Mexico approved the agreement last month.
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.