Arkansas Exports to NAFTA Countries Increased by Nearly 14 Percent in 2017

Photo by Sam Cushman

Arkansas exports to Canada and Mexico increased by 14 percent in 2017 and amount to $2.1 billion in goods.

ROGERS, Ark. – Arkansas exports of goods to Canada and Mexico increased by nearly 14 percent from 2016 to 2017, according to state export data recently released by the U.S. Census Bureau. Combined exports to Canada and Mexico amounted to $2.1 billion in goods alone last year, which means that the two countries receive one third of all Arkansas exports.

“Total exports of goods for Arkansas increased by nearly 11 percent this past year to $6.3 billion,” said Melvin Torres, director of Western Hemisphere Trade at the World Trade Center Arkansas. “This is one of the highest increases in the history of the state. The increase was mostly driven by Canada and Mexico’s dramatic increase in imports during 2017.”

Canada and Mexico are Arkansas’ largest trading partners by billions of dollars, and trade with the two countries supports more than 110,000 jobs.

“Last year was an extraordinary year for Arkansas exports to NAFTA countries.” Torres said. “Overall, exports to Canada and Mexico have increased by 400 percent and 700 percent respectively since NAFTA was implemented in 1994. This latest data release shows that the Arkansas economy depends substantially on NAFTA exports.”

According to the latest data reports from the Census Bureau, in 2017 exports from Arkansas to Mexico reached the highest point since 2014.  Year-over-year exports to Mexico of goods alone increased by nearly 24 percent from $685 million to $847 million. Arkansas exports to Mexico are increasing 3.6 times faster than exports to any other country.

“Mexico’s stunning and rapid growth is accelerating Arkansas export increases to both partners,” Torres said. “These increases reflect the overall trend since NAFTA was implemented as well as the intense efforts of the World Trade Center Arkansas during the past two years. Our increased efforts to engage with both private and government partners have brought synergy and collaboration with both countries.”

The biggest categories of exports to Mexico are transportation equipment, food and agriculture goods such as rice. Mexico buys 26 percent of all agriculture goods exported from Arkansas.

Top exports to Canada include agriculture goods, machinery and equipment; Canada imports 18 percent of its agriculture goods from Arkansas. Arkansas exports significantly more to both countries than it imports, meaning it enjoys an extraordinary positive trade balance, according to Torres.

This information underscores the importance of NAFTA to the state’s economy as the seventh round of NAFTA negotiations began last Sunday. Negotiations began following a federal notice issued by the U.S. Trade Representative in May 2017 seeking views from American businesses regarding the trade agreement. The World Trade Center Arkansas submitted comments and publicly testified in Washington, D.C., on behalf of 150 Arkansas companies in response to this federal notice on July 2017.

On Jan. 16, Arkansas Gov. Asa Hutchinson spoke at the World Trade Center Arkansas during “Arkansas and NAFTA.” Both Mexico and Canada were represented by their consul generals at this event. The governor and other state leaders also spoke at agriculture conferences and emphasized the importance of NAFTA.

“Overall, Arkansas and its leaders at state and federal levels recognize that NAFTA is critical to our state,” Torres said. “We understand the need for updates in areas like eCommerce and intellectual property but overall, NAFTA benefits the exporting Arkansas companies and employees who earn an average 18 percent more than non-trade related jobs. All of Arkansas percentage indicators outperform the U.S. national average on NAFTA exports.”

About the World Trade Center Arkansas: The mission of the World Trade Center Arkansas is to grow trade and increase Arkansas exports by connecting Arkansas businesses to the world through international trade services. For more information and valuable updates, please follow the Center on Facebook and Twitter, or subscribe to the World Trade Center Arkansas newsletter.

About the University of Arkansas: The University of Arkansas provides an internationally competitive education for undergraduate and graduate students in more than 200 academic programs. The university contributes new knowledge, economic development, basic and applied research, and creative activity while also providing service to academic and professional disciplines. The Carnegie Foundation classifies the University of Arkansas among only 2 percent of universities in America that have the highest level of research activity. U.S. News & World Report ranks the University of Arkansas among its top American public research universities. Founded in 1871, the University of Arkansas comprises 10 colleges and schools and maintains a low student-to-faculty ratio that promotes personal attention and close mentoring.