Western New York's economy has not always kept pace with the rest of the state or nation. And, when the national economy slows, our region usually feels the consequences earlier, more severely and for a longer period of time.

To improve our local economy and shelter it from economic slowdowns, Congress needs to forge new trade agreements that further open foreign markets so our exporters can sell more goods and services abroad. This will create higher-paying jobs, strengthen local companies and farms, and improve our tax base, while sending export revenue to local restaurants, retail stores, etc.

U.S. exports account for almost one-third of real U.S. economic growth and a very large portion of our economic development. Consequently, the income of local workers and farmers and the growth prospects of New York-based businesses are pegged to international trade.

These are the key findings released on March 9 in a new Business Roundtable report, International Trade Benefits New York, which I authored. Other findings in the report:

International trade is a primary generator of business and job growth in the Buffalo-Niagara metro area.

The highest manufacturing employment sectors in the Buffalo-Niagara metro area also are among the state's top merchandise export industries, including electronics, fabricated metals, industrial machinery, transportation equipment (the auto industry) and food and food products. Consequently, as exports increase, employment in these sectors also will increase.

A staggering 71.5 percent of Buffalo-Niagara metro area exports were shipped to Canada and Mexico in 1998, much more than other metro areas.

The North American Free Trade Agreement has created a net increase in jobs in New York. Plus, from 1993 to 1998, Buffalo-Niagara merchandise exports to Canada and Mexico rose by 134.2 percent - significantly higher than the overall Buffalo-Niagara export growth rate.

Less than 2 percent of non-farm workers are at risk from imports, which offer consumers greater choices at attractive prices. Imports allow families to purchase more goods with more disposable income available for education, health care, home mortgages, etc. And lower-cost imported components help local producers to be more competitive worldwide.

The business community and political leaders agree that access to foreign markets is key to local economic growth. Erie County Executive Joel Giambra said: "Erie County companies and workers are very competitive internationally. If Congress can forge new trade agreements that bring down foreign barriers, our local businesses will be able to sell more goods and services abroad and create additional higher-paying jobs. In turn, this will generate greater economic growth for Erie County."

Rep. Thomas Reynolds, R-Clarence, said, "From family farms to high-tech start-ups to established businesses and manufacturers, increasing free and fair trade will keep our economy going and create jobs in our community."

Rep. Amo Houghton, R-Corning, noted, "Opening up markets to U.S. exports is critical to creating jobs in the Southern Tier."

Joe McMahon, president of Oxygen Generating Systems, said, "If the U.S. can negotiate new trade agreements that bring down foreign tariffs on our products, we'll be able to sell more abroad and create new jobs here in Western New York." And Francis Chen, president of Mentholatum International, remarked, "International trade certainly has helped us contribute to the growth and employment in the region."

Buffalo-Niagara ranks within the top quarter of fastest growing and largest merchandise export metro areas in the country. Gov. George E. Pataki noted: "New York has created a business-friendly environment by cutting taxes, controlling spending and eliminating red tape. This strategy puts New York companies in a very strong position to compete globally, as well as positioning New York State as an attractive location for international investment. Our aggressive economic agenda reinforces the Empire State as the center of global business marketplace."

Numerous Western New York businesses are succeeding internationally, but more needs to be done. For almost three decades, the U.S. service trade surplus has consistently reduced the trade deficit. In 1999 alone, it decreased the trade deficit by 25 percent. And since 1980, U.S. exports of services have grown 130 percent faster than exports of goods.

New York's private service-producing industries accounted for 75 percent of total gross state product in 1998, a larger percentage than any other state. And in the Buffalo Niagara metro area, 80 percent of non-farm workers are employed in the service sector.

To improve our local economy, companies need greater access to both foreign goods and service markets. To achieve this, we need Congress to forge new trade agreements that further open foreign markets.

This article appeared in The Buffalo News, March 18, 2001.
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John Manzella
About The Author John Manzella [Full Bio]
John Manzella is a world-recognized author and speaker on global business, emerging risks, and the latest economic trends. He's also founder of both the ManzellaReport.com and Manzella Trade Communications, Inc. His latest book is Global America: Understanding Global and Economic Trends and How To Ensure Competitiveness.




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