Sustainable Georgia: What Are We Trading?
Georgia has a lot at stake in this month’s election. If the country leans toward isolationism, we risk being left in the dust.
I’ve been looking into the Trans-Pacific Partnership (TPP), which would reduce or eventually eliminate tariffs between 12 countries (the U.S., Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile and Peru) and grant provisions to improve conditions for world trade.
In the past it has seemed that big corporations and governments have brokered trade deals to access countries with little or no labor or environmental protections to exploit their human and natural resources. Overfishing, illegal logging and sweatshops have proliferated. In contrast, the TPP contains enforceable provisions such as establishing working hours and occupational safety regulations, and requiring commitments from these 12 countries to combat illegal fishing, wildlife trafficking and logging within the countries. I can’t overstate how important this is in reversing these devastating trends.
But it’s a hot potato. I understand why my union friends oppose trade deals; they feel they were burned by the 1993 North American Free Trade Agreement (NAFTA) between the U.S., Canada and Mexico. Unions argue that trade deals allow more earning opportunities for those at the top at the expense of workers who face more competition overseas.
The impact of NAFTA on Georgia has undoubtedly been a positive one. Ask our biggest trading partner, Canada. Georgia imports $4.2 billion and exports $6.4 billion to Canada annually. Some 330,600 jobs here depend on trade and investment with the Great White North.
Canadian Consul General Louise Blais explained to me how NAFTA created an entirely new supply chain between Canada, Mexico and the U.S. “Low-level manufacturing did go to Mexico, but advanced manufacturing grew in the southeast – particularly the auto industry – due to access to that supply chain.” According to the Canadian government, Canada is Georgia’s No. 1 customer, and Georgia exported $1 billion worth of automobiles to Canada, $415 million in aircraft, $393 million in plastics and plastic parts, and $290 million in carpets in 2015.
Ambassador Robert Holleyman, deputy U.S. trade representative; former U.S. Sen. Saxby Chambliss; and UPS Chair and CEO David Abney spoke recently to the World Affairs Council of Atlanta. Chambliss emphasized that China will negotiate their own deal if this falls through, and nothing less than national security is at stake. “We need these countries – they aren’t going away.”
Abney said the TPP will level the playing field, allowing for unions and collective bargaining in member countries. It “pushes a reset on our deals with Mexico and Canada” to a higher standard than previous agreements. He believes the U.S. would see the “reshoring” of jobs as TPP companies gain access to domestic workforce opportunities.
Export companies grow faster than those serving domestic markets, Atlanta Mayor Kasim Reed noted at the event, but are blocked by tariffs and red tape.
“Our customers feel the disadvantage with the dollar so strong and don’t need any more barriers,” agreed Abney. “Historically, when we pass a trade agreement, volume increases 20 percent on average. This is not about big companies – they already know how to do world trade. This is about the unsung – medium and small businesses.”
In response to criticism of world trade courts, Blais said that for a country as small as Canada (36 million) to negotiate with the U.S. (322 million), an arbitration process is necessary. “Countries like ours need this for fairness,” she emphasized. She also recommended that “compensation for affected sectors” would be important to the success of the TPP.
Regarding NAFTA, it would be impossible to tear apart the agreement that has let companies from Georgia and Canada work together, she notes. I would add that it would be unwise to pass up an opportunity to improve on this agreement.
There is a deep social, environmental and economic impact to be considered here that is both non-partisan and common sense. We must acknowledge that ripping up trade deals would cripple our state, and we should stand by the positive results we’ve seen in Georgia.