Arkansas exports increased last year by nearly 11% to $6.3 billion, a third of that to Canada and Mexico. That’s according to a new report from the World Trade Center Arkansas (WTCA) in Rogers.
“Last year was an extraordinary year for Arkansas exports to NAFTA [North American Free Trade Agreement] countries.” said Melvin Torres, director of Western Hemisphere Trade at the WTCA. “Overall, exports to Canada and Mexico have increased by 400% and 700%, respectively, since NAFTA was implemented in 1994. This latest data release shows that the Arkansas economy depends substantially on NAFTA exports.”
Torres said Canada and Mexico are Arkansas’ largest trading partners by billions of dollars, and trade with the two countries supports more than 110,000 jobs.
The report comes amid President Donald Trump’s plan — made official March 8 — to enact a 25% tariff on steel imports and a 10% tariff on aluminum, which has some concerned about global trade wars that could hurt Arkansas agriculture, the state’s largest industry sector.
The tariffs took effect March 23. Canada and Mexico will be excluded for now, a good sign for the ongoing renegotiation of the NAFTA deal with Canada and Mexico, Torres said.
A seventh round of negotiations began in February following a federal notice issued by the U.S. Trade Representative in May 2017 seeking views from American businesses regarding the trade agreement. The WTCA submitted comments and Torres publicly testified in Washington, D.C., on behalf of 150 Arkansas companies in response to the federal notice.
Mexico buys 26% of all agriculture goods exported from Arkansas. Canada buys 18%.
“The president made remarks at the end of his [announcement] that seemed to point to a positive outcome as far as the renegotiation,” Torres said. “Overall, it’s certainly a relief to [Arkansas] farmers, for now, because so many of our exports go to those two countries.