International trade is important for small businesses that make up 98 per cent of U.S exporters. Every day, almost 300,000 small and medium-sized enterprises (SMEs) that provide approximately four million American jobs, are exporting to foreign markets.
Workers at export manufacturing companies earn wages that are 12 to 18 percent more than workers at companies that produce for the U.S. market only according to Jeffrey J. Schott of the Peterson Institute for International Economics.
If approved by Congress, President Donald Trump’s “United States-Mexico-Canada Agreement,” or USMCA, would replace NAFTA. The agreement aims to promote cooperation between the three countries that will increase investment opportunities and trade for small businesses.
The USMCA is the first trade agreement with a specific chapter focused on small and medium-sized enterprises. The chapter states that the agreement will lead to the establishment of a committee on SMEs composed of officials from the three countries, the establishment of patentability standards and patent office best practices and the creation of information-sharing tools for small businesses and their employees.
The agreement will also enforce the removal of existing unnecessary burdens that might discourage entrepreneurs from engaging in international trade. For example, the agreement will remove the requirement to open a foreign office in order to do business in another country.
The USMCA will simplify the participation of Mexican and U.S. SMEs in government procurement. For example, the agreement might make use of technology, like a common electronic portal to provide information about planned government procurement.
Free trade provides new market opportunities for all business sizes and types – from farmers, ranchers to manufacturers. New markets mean additional jobs.
Congress can prove to the small-business community that it appreciates and understands the special role of small businesses in international trade by approving the USMCA.