STORES Magazine - January 2018 - 65
International Trade is the
Lifeblood of the Retail Industry
The ability to source high-quality goods from around the world
at reasonable prices is vital
by JONATHAN GOLD
Jonathan Gold is vice president of supply chain and customs policy for NRF.
uring the 2016 presidential campaign, both candidates
demonized trade, specifically claiming that free trade
agreements do not provide benefits for U.S. workers. The
negativity has continued since President Trump took office -
one of his first official actions was to withdraw from the new,
12-nation Trans-Pacific Partnership agreement before it could
even take effect. The move was an extreme disappointment
for NRF and the rest of the business community, which strongly
supported the TPP to help open key markets.
The latest threat revolves around the landmark North
American Free Trade Agreement. The United States is currently
negotiating with Canada and Mexico to "modernize" the
agreement. After 23 years, it certainly makes sense to update
NAFTA; unfortunately, many of the proposals the Trump
administration has put forward threaten the success of the
negotiations. Trump himself has threatened to withdraw from
the agreement. While he claims it is a negotiating tactic, it is
unlikely that Canada and
Mexico would come back
to the table if the U.S.
were to withdraw.
The administration's focus
is on reducing the perceived
manufacturing trade deficit
with Canada and Mexico,
with the expectation that
jobs would come flooding
back. The reality is that
the U.S. economy is no
longer based on traditional
sold in the U.S. today
are the product of global
value chains, the collection of jobs, services, parts and supplies
that contribute to the value of a product. These value chains
represent millions of U.S. jobs and are vital to retailers as well as
manufacturers, agriculture and services industries.
While a product might say "Made in Country X," it typically
includes a high percentage of U.S. contributions made by
U.S. workers in jobs as wide-ranging as research and design,
sourcing, logistics, compliance, distribution and many others.
That is why NRF recently helped launch the U.S. Global Value
Chain Coalition to help tell the story of these important U.S.
jobs and their importance to the U.S. economy.
It is important that elected officials take these jobs into
consideration as they debate trade policy. They need to look
beyond the narrow focus of manufacturing and consider the
larger value chain and its importance to the economy and
consumers. To make that happen, companies must get engaged
and talk about the importance of trade for their business, their
workers and their customers.
From the clothes Americans wear to the food they eat to
the cars they drive, international trade and the global value
chain are almost always involved. The nation's focus on trade
should be to further develop U.S. participation in these value
chains and take advantage of the opportunities for domestic
job growth that they
offer. The best way to
do this is to further open
markets abroad and truly
modernize our free trade
agreements. We must look
forward, not backward at
"how things used to be."
The original goal to
conclude the NAFTA
was the end of 2017,
but at this point talks are
expected to continue into
early 2018. The hope is
that the parties will be able
to resolve differences over
negotiating objectives and
arrive at an agreement that will modernize the agreement and
set a path forward for future U.S. trade negotiations. However,
significant concern remains that the three countries won't be able
to arrive at an agreement and that Trump will follow through on
his campaign threat to withdraw from NAFTA. That cannot be
allowed to happen.
STORES January 2018 65