Arkansas Aerospace and Defense Alliance executive director Chad Causey thinks breakthroughs on two trade fronts will stimulate his industries’ sales.
Appearing on this week’s edition of Talk Business & Politics, Causey said the Phase 1 trade deal with China will result in the sale of hundreds of Boeing aircraft to China, up to $200 billion in trade. He noted that many of the component and part makers located in Arkansas will benefit.
“I think what that means is that Boeing will probably be selling additional aircraft to China. We have multiple Boeing suppliers here in the state. But it also means that we’re going to see more manufacturing overall in the pipeline with that increased spending. That’s going to free up more opportunity to have further investment with Arkansas companies supplying those that are selling that aircraft into China,” he said.
Causey also said initial reports on the China trade deal could benefit Arkansas agriculture by restoring a slightly boosting markets like soybeans. As for Phase 2, Causey said it remains to be seen how that will play out and if anything will happen before November’s presidential election.
“I think there’s different theories on it. I mean, the short answer is ‘no, we don’t know,'” he said. “I think a lot of that will depend on how phase one goes… Phase two could be further reductions in those tariff numbers, further commitments from China on currency and other issues that matter to U.S. trade.”
Causey also said that the USMCA – NAFTA 2.0 – will really help Arkansas’ manufacturing sector as Canada and Mexico are America’s biggest trading partners.
“Canada and Mexico have significant aerospace sectors,” Causey said. “It [USMCA] really reinforces the commitment between the three countries to either reduce tariffs on manufacturing crossing those borders or eliminate them entirely and make a commitment to not have any in the future.”
The Arkansas Aerospace and Defense Alliance has also announced it will work with the World Trade Center Arkansas to help offset costs for Arkansas firms to participate in national and international trade shows where a lot of business is conducted and contracts are signed.
“The cost of attending major aerospace trade shows in North America and around the world can be cost prohibitive for all but the biggest of companies. By working with the World Trade Center Arkansas, the Alliance can help take Arkansas aerospace to the global marketplace,” Causey said.
“Aerospace and defense is the largest export for the state of Arkansas,” said Boon Tan, senior director of global trade strategy at World Trade Center Arkansas in a recent press release. “We have more than 180 aerospace and defense parts and services companies located in the state. With the fast growing Maintenance, Repair and Operations (MRO) industry in Southeast Asia, I foresee a lot of business opportunities for Arkansas aerospace companies. We are now looking into aerospace trade shows in Asia like the Singapore Airshow.”
You can watch Causey’s full interview in the video below.