By Representative Rokita
Congress recently approved and President Barack Obama signed important free-trade agreements with South Korea, Colombia and Panama. These agreements will be beneficial to Indiana manufacturing and agriculture, and Hoosier workers, at a time when record numbers are looking for work. When given a chance to compete on a level playing field -- which these free trade agreements accomplish -- well-made American products win, our economy grows, and, as a people, we benefit.
According to the US Chamber of Commerce, Indiana's 4th District exports more than $7 billion in products every year and foreign trade directly supports more than 7,000 jobs in the district.
Across the state, foreign trade directly supports more than 75,000 Hoosier jobs. From 1997 to 2010, Indiana's exports have increased by 138 percent, including by 432 percent to Panama, 224 percent to Colombia and 162 percent to South Korea. These numbers are great news for Indiana's economy and they will only improve as a result of these free-trade agreements.
South Korea, Colombia and Panama are already important trading partners, despite the unfair tariffs they currently impose on American goods and services. In 2010, American companies exported $38.8 billion worth of goods and services to South Korea, $12.1 billion to Colombia and $6 billion to Panama. During the same time, Indiana companies exported $551 million worth of goods and services to South Korea, $90 million to Colombia and $37 million to Panama.
Opening markets like these to American products will help reduce our large trade deficit, which was $497.1 billion in 2010 and stands at $377.7 billion in 2011. The South Korea free trade agreement increases exports by 30 percent more than it will increase imports. The Colombia agreement increases exports by 50 percent more than imports.
Last week, officials from Caterpillar's Large Engine Center in Lafayette joined me to discuss the importance of free trade. More than 40 percent of the engines built in Lafayette are exported to other nations. CAT officials expect these numbers to increase as a result of new free trade agreements. Panama, for example, is preparing to expand the Panama Canal, a mega-construction project that requires the type of heavy equipment CAT produces.
Indiana farmers can also expect significant positive effects from these agreements. Many estimates predict $500 million in additional exports and 500 new jobs in our agricultural sector.
Putting Hoosiers back to work and creating an environment where entrepreneurs and businesses can create jobs are among my top priorities in Congress. Getting spending under control, getting government red tape out of the way and reforming the tax code are critical to fixing the economy and promoting the growth of businesses, particularly small businesses.
When you consider that small businesses have created 69 percent of all new jobs between 1993 and 2008 and that small businesses comprise 86 percent of Indiana's nearly 6,600 exporters, it becomes clear that free trade agreements are a vital tool for growing Indiana's economy and creating jobs.
Finally, logistics is as important to trade as it is critical to our Hoosier economy. Given our position as the "Crossroads of America,' Indiana is perfectly suited to become a chief American exporter. In 2010, Indiana ranked fourteenth in exports, sending $28 billion worth of products overseas. Excellent access to interstate highways, air, rail and navigable water ways gives us a unique opportunity to build a vibrant economy as free trade agreements are reached with increasing numbers of foreign nations. We must make the most of this opportunity.
Our economy is ever changing. We cannot maintain the status quo or isolate our economy from the rest of the world. Free trade agreements open new markets to American products and American workers. Given a level playing field to compete, well-made US products will win. The result will be a stronger economy, job growth, revitalized manufacturing and a future of prosperity and opportunity for our children and grandchildren.