WANT MORE ECONOMIC STIMULUS? PASS THE PENDING FREE TRADE AGREEMENTS!
March 3, 2008
Expanding trade is one of the fastest routes to economic expansion, says James M. Roberts, a research fellow with the Heritage Foundation. U.S. Secretary of Commerce Carlos Gutierrez recently noted that in 2007, "U.S. exports...increased 12.7 percent to $1.4 trillion, an all-time record. We're on track to beat that this year with continued, double-digit growth." Much of the growth in gross domestic product (GDP) was a result of free trade agreements that the United States has negotiated with 14 countries.
The following facts, compiled by the U.S. Department of Commerce, provide concrete examples of the benefits that FTAs have brought to Americans.
- Since January 2000, the United States has implemented seven FTAs with 11 countries; between 1999 and 2007, U.S. merchandise exports to these countries increased by 75.1 percent, compared to the 66.7 percent growth in these exports to the rest of the world.
- From 1999 to 2007, U.S. merchandise exports to Chile increased by 170 percent, or $5.2 billion, to reach $8.3 billion.
Since the United States began implementing its free trade agreement with Central American nations and the Dominican Republic (CAFTA-DR) last year, U.S. exports have grown by 13 percent. This growth accelerated a trend:
- From 1999 to 2007, U.S. merchandise exports to the CAFTA-DR region increased by 78.5 percent, or $9.9 billion, to reach $22.4 billion.
- The U.S. trade balance with the CAFTA-DR region improved from a $2.8 billion deficit in 1999 to a $3.7 billion surplus in 2007.
As Congress considers a second round of economic stimulus measures, it needs to look no farther than the pending free trade agreements (FTAs) with Colombia, Panama, and South Korea, says Roberts. These agreements have been in limbo since congressional leaders delayed action on them last summer.
Source: James M. Roberts, " Want More Economic Stimulus? Pass the Pending Free Trade Agreements!" Heritage Foundation, WebMemo #1830, February 27, 2008.
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