Business Roundtable is an association of chief executive officers of leading U.S. companies working to promote a thriving economy and expanded opportunity for all Americans through sound public policy.
The United States needs a winning trade agreement negotiating strategy because our foreign economic competitors are not standing still. Such a strategy should rely on negotiating trade agreements – bilateral, regional, plurilateral and multilateral – that will maximize U.S. leverage and ensure the United States actively shapes the international trading system so U.S. companies and workers are not disadvantaged.
There are now more than 270 bilateral and regional trade agreements between countries worldwide, and the United States is a party to only 14 of those agreements. These U.S. free trade agreements (FTAs) have greatly benefited the U.S. economy and American jobs by increasing U.S. exports and creating strong, enforceable rules for U.S. trade and investment with those countries. For example, while they include only six percent of the population outside the United States, the 20 U.S. FTA partner countries purchased nearly half of all U.S. goods exports worldwide in 2015. In that same year, the United States had a nearly $8 billion surplus in goods and services trade with FTA partner countries. This compares to a $509 billion U.S. deficit in goods and services trade with non-FTA countries. In the United States, U.S. trade and the trade agreements that help enable it support nearly 41 million U.S. manufacturing, services and other trade-related jobs – more than one in five.
Our foreign competitors are using their own FTA negotiations to advance their own national interests and gain competitive advantages over U.S. companies and workers by: (1) opening foreign markets and creating export opportunities on preferential terms for their companies and workers; (2) creating and supporting higher-paying domestic jobs tied to trade for their workers; (3) writing “free and fair” trade rules on their terms; and (4) advancing their foreign policy and national security goals.
Here are a few examples of other countries’ FTA efforts around the globe. The European Union (EU) has completed FTAs with Singapore, Vietnam and Canada. The EU is also negotiating FTAs with Japan, India, Indonesia, Mercosur (Brazil, Argentina, Uruguay and Paraguay), the Philippines, Australia and New Zealand and modernizing its existing FTA with Mexico. China is negotiating the Regional Comprehensive Economic Partnership with 15 countries, including seven of the 11 Trans-Pacific Partnership countries, and a trilateral FTA with Japan and South Korea. Moreover, Mexico, which is the second- largest U.S. goods export market, has a network of FTAs with 44 countries.