Message from Maria Isabel Ellis,
Executive Director of PNITA
A staggering 30 million workers--including more than 334,000 Oregonians--have applied for unemployment in the last few weeks. The economic pain is widespread here and abroad, and with this devastation comes discussion about what the future of the economy, trade and globalization will look like in a post COVID-19 world. Though there are still many unknowns, the shape of our economic recovery depends on a carefully planned and phased opening of normal economic activity, paired with sufficient testing and personal protective equipment (PPE) availability.
Perhaps one of the biggest implications of the COVID-19 era may be how it shifts our views on globalization. And though rallying cries of nationalism and protectionism existed before the COVID-19 outbreak, the pandemic has highlighted some of the challenges of globalization. In particular, how globalized
just in time
supply chains can create risk for national interests, such as in the medical equipment and pharmaceutical industry. Yet, we cannot throw the baby out with the bathwater.
As we think about what changes are needed to our economic strategy to ensure our global competitiveness and security, we must not give into protectionist economics. Doing so would only hurt our domestic businesses and workers.
Globalization is strongly woven into all aspects of our lives, and though it may look slightly different in the future, this reality will not change.
We need, and must, continue to work closely with our international partners on trade, climate change, security, and potential future health threats. And Pacific Northwest International Trade Association (PNITA) is here to help connect the dots and do just that, for Oregon and beyond.
To stay connected, or get more involved with PNITA,
click here
.
|
|
Pressure from all sides for PNW agriculture exports
Agriculture was Oregon’s fastest growing industry in 2018, with over 37,000 farms operating throughout the state. Today, this industry is facing heavy headwinds, leaving farmers and ranchers more unsure than ever about their future. Here are just a few examples:
- Higher costs for moving products. Unloading backlogs and ship quarantine requirements in China have driven up prices for refrigerated containers. Likewise air-freight rates are soaring after passenger flights--which have historically moved about 50% of air cargo in their hull--dropped by nearly 90%.
- Slumps in demand abroad and domestically. With the global economy going into recession, producers are getting hit by both declining demand abroad, while local restaurant closures have hampered demand at home. Oregon’s seafood industry is an example of how restrictions on the shipment of live animals into China, a key market for export, and the closure of restaurants locally, has had a gutting effect on the industry.
- Labor shortages and increased COVID-19 safety measures. Though the Trump Administration’s immigration restrictions won’t apply to agriculture, farmers are still voicing concern about their ability to access the seasonal labor needed during critical harvest time. In addition, many farms are scrambling to modify their operations and procedures to add more health precautions for workers and crops from the coronavirus.
|
|
Advocating for trade during the economic recovery
|
|
As all levels of government work to support recovery, we must prioritize industries reliant on trade. Roughly 89% of all exporting firms in Oregon and SW Washington are small- and medium-sized. Supporting these firms, in turn, supports the main street businesses and workers that rely on them. In Oregon alone, there are over 505,000 workers whose jobs depend on trade activity.
Read our op-ed
on what government can do to help and how we're working to further this effort.
We also partnered with our counterparts in
Washington and California
to send a joint message to the Trump Administration about the importance of supporting trade as part of an economic recovery strategy.
|
|
The National Association of Manufacturers released their “
American Renewal Action Plan
.
” The plan, split into three phases - response, recover, and renew - outlines how we can ensure our important manufacturing industries can emerge from this crisis and continue to be an important pillar of our economy. Their recommendations align well with PNITA’s policy priorities for trade promotion.
|
|
The global economy, value-chains and China
|
|
The World Trade Organization released its global trade forecast, which indicates a 13% to 32% drop in activity in 2020, with impacts easily being felt into 2021. The economy on the whole will also see some lasting impacts due to COVID-19 in everything from acceleration of automation, shifting of global powers, the digital divide, and more. Check out these thoughtful reads:
- The robots are ready as the COVID-19 recession spreads, read the article here
- How COVID-19 will change the nation’s long-term economic trends, read the article here.
- It’s the end of the world economy as we know it, read the article here.
|
|
Here in the Pacific Northwest, China has served as an important value-chain hub for many of our products -- as it has for many other parts of the world. The pandemic highlighted the risk of such China-centric value chains, which may accelerate a trend of firms moving their value chains into other parts of Southeast Asia, a trend started by China’s increasing wages and IP theft concerns. Japan and France are already looking for ways to help their firms diversify their supply and value chains from China. But will this mean a U.S. “decoupling” from China altogether? Unlikely.
|
|
Limited tariff reprieves and USMCA
|
|
The Administration released a
temporary rule for a 90-day deferment
in the payment of tariffs for importers experiencing “significant financial hardship” due to COVID-19. Yet, as this did not apply to 201, 232, or 301 tariffs, it does little to ease the structural pains being felt by trading firms and would still require payment after deferment. The U.S. Trade Representative (USTR) is taking comment on rules to
extend 301 tariff exclusions for up to 12 months
, which we see as a positive move.
The full implementation timeline for USMCA was fast timeline to begin with, but COVID-19 made it even tighter. The Administration and partners are aiming for
July 1 for enforcement of the treaty
, but certain industries, such as the auto industry, will need
additional time and flexibility
to address new regulations.
|
|
In the midst of this difficult time, we want to give
a shout-out to SM Line
. Their calls at the Port of Portland, started in January and support work for longshoremen who load and unload hundreds of containers. This activation provides options
for PNW growers and exporters to transport their products to Asian markets. The South Korea-based container carrier calls at Terminal 6, Oregon’s only international container terminal. Read more
here
.
|
|
Welcome our newest member!
|
|
Oregon’s very own
Schnitzer Steel
has been a global leader in the collection, processing, and sale of the world's most recycled product - steel - since its founding in 1906. Today, Schnitzer Steel employs more than 3,500 workers in Oregon, and operates
94 recycling facilities
, including seven deep-water ports.
|
|
|
As a member of PNITA, you will be part of a coalition of organizations proactively advocating for trade-friendly federal policies that support businesses, workers and families here at home.
Click here to learn more about becoming a member.
|
|
THANK YOU TO OUR PLATINUM MEMBERS
|
|
|
|
|
|
|
