Local leaders agree, USMCA vital to Arizona economy

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It is no secret that trade policy has been a major priority for U.S. policymakers, business owners and workers this summer. At the top of the agenda is the United States-Canada-Mexico Agreement. If passed, the USMCA will bring much-needed certainty and help ensure continued growth for businesses in Arizona and across the country. 

Last November, leaders from the U.S., Mexico and Canada signed this new agreement to update existing rules put into place under the North American Free Trade Agreement. While NAFTA strengthened regional trade significantly when it was ratified nearly three decades ago and has resulted in stronger economic growth across North America – as demonstrated by the surge in cross-border investments and a tripling of U.S. trade with Canada and Mexico – it has become increasingly out-of-date and doesn’t address today’s needs for commerce and trade.

For instance, digital transformations that have taken place since 1990 have transformed our economy and the way we do business. Updating NAFTA to include stronger intellectual property protections and more stringent guidelines on digital trade is not just practical, it is necessary. U.S. companies small and large are conducting much of their business online, and the USMCA would ensure they can do so safely and securely while helping smaller businesses expand their customer reach and their operations.

This new trade deal would also protect U.S. businesses from anti-competitive behaviors by other countries and improve rules to remove unfair trade barriers. Ultimately, it would help expand our access to new customers and create a more prosperous and robust business climate for Arizona and the U.S.

In fact, a report released by the U.S. International Trade Commission recently found that, once enacted, the USMCA could add about $70 billion to the economy, create nearly 200,000 jobs and have a positive impact on wages for American workers. 

For Arizona manufacturers, this agreement is particularly important given our economy’s reliance on trade with our North American partners. According to data from the National Association of Manufacturers, one in five Arizona manufacturing firms export to Mexico and Canada, and those two countries purchase more than two-fifths of our state’s global manufacturing exports. If the agreement is not ratified, Arizona manufacturers could face up to $2 billion in extra taxes, compared to zero tariffs today.

Further, manufacturing jobs in our state are well-paying and provide career opportunities to middle-class workers. In fact, the average Arizona manufacturing employee earns more than $82,000 a year in total compensation compared to less than $44,000 a year for other industries. In total, more than 19,000 Arizona jobs rely on tariff-free trade with Canada and Mexico. 

For the benefit of our workers, our businesses and our state’s economy, we need Congress to act and ratify the USMCA as soon as possible. The Trump administration has done its part to negotiate a deal that puts American businesses first. Now, Congress must come together and get this done. 

John Giles is mayor of Mesa, Jenn Daniels is mayor of Gilbert, Gail Barney is mayor of Queen Creek, and Denny Barney is president of the East Valley Partnership.