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Remarks by Ambassador Michael Froman at the White House “Made in Rural America” Forum
From Linn County to Lima: Making it Here, Selling it Everywhere
Cornell College, Cedar Rapids, Iowa
August 8, 2014
*As Prepared for Delivery*
“Thank you, Linda, for that kind introduction. And thank you for all the work that you, Dennis, and Doug are doing to grow Linn County’s economy through trade and investment. Thank you also to Cornell College for hosting this important event.
“And since we’re at a leading liberal arts college, I thought I might start with a little history lesson. But don’t worry, this isn’t summer school, I’ll keep it short. There’s an early history of Linn County, published in 1878, that makes the following prediction about Cedar Rapids: “It is unquestionably destined to become a populous center of trade, but at the same time will not sacrifice its more enjoyable characteristics in the pursuit of wealth.”
“In a sprawling book of over 800 pages, those words stuck with me for two reasons. First, Cedar Rapids has become a populous center of trade, having exported nearly $900 million in merchandise during 2012. Second, towns like Mount Vernon are a testament to the fact that Iowa’s economic rise has not come at the expense of its character.
“That conviction—that we must advance both our interests and our values—is at the core of President Obama’s trade agenda. And nowhere is that commitment more evident than in the White House Rural Council’s ‘Made in Rural America’ export and investment initiative. As part of that initiative, it’s a privilege to join you today for the third of five regional forums organized in collaboration with the National Association of Counties.
“Many of you are here to decide whether exporting should be the next step for your farm or small business. Others are already exporting and will be sharing their experiences with us today or learning how to further bolster their sales to foreign markets. We’re brought together by a shared appreciation for rural America’s importance to the greater U.S. economy and by the economic opportunities that exist outside our borders.
“In recent years, Iowa workers, farmers, and businesses large and small have been a leading example of how trade creates better jobs and drives economic growth. As the second-largest agricultural exporter in America, Iowa has been a key contributor to the roughly 40% increase in U.S. agricultural exports since 2009. That includes last year’s national total of nearly $150 billion in agricultural exports—the highest in U.S. history. And, thanks to Iowa, we are on track for another record-setting year.
“Of course, the best part about these records is that the success is shared. Across America, our exports last year supported more than 11 million jobs, and increase of 1.6 million jobs since 2009. Agricultural exports alone supported nearly 1 million jobs, and we know that on average, export-supported jobs pay 13-18% more than non-export supported jobs. We also know that agricultural exports create positive ripple effects throughout the economy as value is added at each step between the farm and the table. In 2012, every dollar of agricultural exports stimulated another $1.27 in business activity.
“Among these numbers are millions of farmers, manufacturers, and small businesses, many of them in Iowa. In 2012, more than 3,300 Iowa companies exported, and more than 80% of these companies were small businesses.
“I’ll be visiting some of these small businesses during my stay in Iowa, including Kimberley Family Farms, which is based in Maxwell. Coming from a line of farmers and ranchers that goes back to the 1850s, the Kimberley family has incorporated best practices, such as no-till farming, for soybeans into their farming. Today, Kimberley Farms has a total grain storage capacity of roughly 400,000 bushels in 5 different sites, and it exports soy and corn to Asia.
“I’ll also visit Kemin Industries, a Des Moines-based company that manufactures over 500 specialty ingredients for the global feed and food industries, as well as the health, nutrition and beauty market. Kemin’s products reach over 2 billion people across more than 90 countries. The innovation behind Kemin’s success shouldn’t come as a surprise. After all, there’s a long-list of famous brands with Iowa roots, including Maytag, Stover, Chrysler and others.
“Yet another example of how Iowa’s innovative small businesses are growing through exports is the story of Think Safe, a Cedar Rapids-based first aid and safety company. Think Safe was founded in 2004 after a former flight nurse for St. Luke’s Hospital identified the need for a product that could offer first aid instructions to untrained people during rescue situations. Earlier this year, Think Safe received a patent for a device that does just that, and today, its products are sold to distributors in Africa, the European Union, Mexico and Canada.
“And by all indicators, trade is only growing more important to Iowa’s economy. According to a recently-released ranking by the U.S. Chamber of Commerce Foundation, Iowa is 7th in the nation in export intensity growth, meaning that exports are growing to contribute an even greater share of Iowa’s GDP. And during 2011, one-quarter of all manufacturing workers in Iowa depended on exports for their jobs.
“Through President Obama’s trade agenda, we’re working on multiple fronts to help lower barriers for U.S. exports so that more American businesses can export and those who are already exporting—like Kimberly Family Farms, Kemin Industries, and Think Safe—can export more. These are 3 of the nearly 300,000 U.S. small businesses that currently export, and with less than 1% of all businesses currently exporting, we have a lot of room for growth.
“That’s why we’re negotiating ambitious, next-generation trade agreements like the Trans-Pacific Partnership, or TPP. When completed, TPP will lower barriers for U.S. exports to the world’s fastest growing region, representing 40% of the global economy, including three of Iowa’s four biggest exports markets: Canada, Mexico, and Japan. As the economies of the Asia Pacific grow, incomes rise and middle classes emerge, more and more people will be looking for better, safer, more diversified diets.
“These shifting consumption habits will continue driving demand for meat, dairy, organic, and other ‘Made in Rural America’ exports.
“Our discussions in TPP are also aimed at setting high standards across a range of issues that will level the playing field for American workers and businesses. We’re doing this not only because promoting fundamental worker rights and protecting the environment is consistent with our values, but also because we know that when global competition is fair, America’s workforce and businesses—the most productive in the world—win.
“We’re also unlocking opportunities for “Made in Rural America” exports in America’s largest market: the European Union.
“Through our negotiations in the Transatlantic Trade and Investment Partnership, or T-TIP, we’re knocking down non-tariff barriers that have prevented some small American businesses from competing in the European market. T-TIP will also enhance market opportunities for a number of goods that Iowa is already exporting to the EU, including soybeans, animal feeds, pork and other livestock products.
“In parallel with our T-TIP negotiations, we are working to remove unnecessary regulatory barriers affecting agriculture exports. Last year, the Obama administration resolved nearly 200 trade-related barriers involving U.S. agricultural exports, including resolutions that helped increase total U.S. beef exports by 12% and U.S. pork exports to Colombia by 63%. And we’re continuing to make progress on these issues.
“When completed, TPP and T-TIP will give us free trade with almost two-thirds of the global economy, and the United States will be at the center of that economy as the world’s production platform of choice. More businesses will want to move their operations to the United States to take advantage of our talented workforce, abundant and affordable energy, dependable legal system, and all the other qualities that make America great. Farmers, ranchers, small businesses, and other will grow it here, raise it here, make it here, and sell it all around the world.
“We’re also standing up for American families, farmers and businesses by vigorously enforcing our existing trade agreements. This administration has made enforcement a top priority, and its track record in upholding the rules-based trade system is second-to-none.
“We have brought 18 disputes in the World Trade Organization, and having won every dispute decided so far, we’re on our way to creating billions of dollars in additional opportunities for U.S. exporters.
“At the end of the day, all of these efforts—opening new markets, deepening our existing economic ties, resolving unwarranted barriers, and enforcing our agreements—create opportunities, but it falls on each of us to seize them. The idea of exporting to Asia might seem daunting, but you’re not alone. As you’ll hear more about today, there are a number of local, state, and federal resources available to help you tap into the 95% of consumers and 80% of the world’s purchasing power that exists outside our borders. Together, we can make those opportunities a reality.