Op-ed: Trade agreements would boost Utah products internationally
By Nigel Steward, Managing Director of Rio Tinto Kennecott in South Jordan
http://www.sltrib.com/opinion/2503528-155/op-ed-trade-agreements-would-boost-utah
Trade and commerce are woven throughout Utah's history. From the first manufacturing operation in the state at the Provo Woolen Mills, to the modern day tech leaders of the "Silicon Slopes," Utah has always been "the right place" for trade and enterprise.
Now, back in Washington, Utah is leading on trade. Sen. Orrin Hatch, chairman of the Senate Finance Committee, is advancing bipartisan legislation that will facilitate trade agreements that can tear down barriers to Utah exports, open new markets and help companies across the state find more opportunities to sell goods and services across the globe. Trade Promotion Authority, or TPA, commits Congress to stringent review of two trade agreements being negotiated by President Obama and a simple process to approve or reject them. Understandably, trading partners like Japan, the European Union or Indonesia won't cut a deal with U.S. negotiators if they think every member of Congress can tinker with the terms after a deal is struck. TPA ensures that Congress will vigorously review any trade agreement before it comes to a vote, but only accept or reject the deal, not amend it.
The trade agreements that are being negotiated and that would be subject to TPA hold the prospect of massive opportunity for Utah exporters: the Trans-Pacific Partnership (TPP) and the Trans-Atlantic Trade and Investment Partnership (TTIP). These trade agreements will deliver more jobs, more choices and lower costs for American consumers. These agreements will allow Utah's businesses to benefit from reduced trade barriers, increased transparency standards and access to new sources of foreign direct investment.
Utah is already exporting more than $4 billion worth of goods and services to the countries in the Trans Pacific Partnership agreement. A successful TPP deal will lower tariffs and other barriers to Utah's products and services. For instance, Japan currently imposes a 38.5 percent tariff on Utah beef products. A strong TPP agreement could bring that to zero.
The TTIP agreement will also include strong provisions to encourage investment between the United States and Europe. More than 35,600 jobs in Utah are supported by "insourcing" companies like Oemeta, a German-based company that produces lubricants for the automotive industry. Oemeta announced last year that they will build a new plant in Salt Lake County, creating 58 new manufacturing jobs.
As managing director of Rio Tinto Kennecott, one of Utah's largest exporters, I am proud of our contribution to Utah's trade story over the 112-year history of the Bingham Canyon Mine. The Bingham Canyon Mine has produced more copper and copper by-products than any mine in the world — nearly 20 million tons. While most of the copper produced today from the mine is consumed by manufacturers in the United States, the products they make are exported all around the globe. A domestic supply of copper is critical to the supply chains of many U.S. manufacturers whose products compete globally.
Rio Tinto Kennecott also directly exports more than $250 million of molybdenum (a copper by-product) to customers in Asia and Europe. Metals like molybdenum, gold and silver are at the heart of Utah's international offering, accounting for 37 percent of Utah's exports last year.
TTIP and TPP will lower tariffs and facilitate market access for Utah's mineral, agricultural and tech exports. For Rio Tinto and our 2,400 employees in the Salt Lake Valley, TTP and T-TIP holds the prospect of increasing global demand for our products. While trade and commerce are part of Utah's history, they are vital to our current prosperity. Sen. Hatch's bipartisan TPA legislation is a critical step to ensuring that Utah continues to benefit from international trade and investment.
Dr. Nigel Steward is managing director of Rio Tinto Kennecott in South Jordan.
