What will TPP do for small businesses? New report shows its impact.

Photo Credit:Josh Denmark

More than 30 small businesses from across the country submitted testimony to the U.S. International Trade Commission for its report on the Trans-Pacific Partnership. This report, just released today, found that the trade agreement would reduce barriers for small businesses exporting.

Many business leaders testified that TPP would improve their access to international markets by reducing tariffs. Others explained that TPP would protect their intellectual properties in member countries or help them compete with China. Several noted that increasing international trade would enable them to hire more workers to keep up with new demand.

As mandated by trade promotion authority law signed by President Obama in June 2015, the USITC evaluated how the TPP would affect the U.S. economy. This analysis is the final requirement before Congress may introduce the implementation bill for the trade agreement.

Below is a selection of quotes from business leaders who submitted testimony to the Commission for consideration in their research, as well as links to those testimonies.

ALABAMA

“The internet makes it possible to do things that would have been impossible in the past. A few years ago my company first started to sell things on eBay to test the market and it just so happened that we sold internationally in the first week. Now we have sold our products in over 105 countries,” said Tess Winningham, CEO of Alignment Simple Solutions LLC in Birmingham, Ala. “It’s time for America’s policies to match our potential. I hope Congress passes the Trans-Pacific Partnership to open more doors for U.S. companies.”

ARIZONA

“When our company began production in 2005, we had one employee,” said Ray Zuckerman, the CEO of ServerLIFT Corporation in Phoenix, Ariz. “Thanks in large part to our ability to expand internationally, we now employ 25 and are growing. Strengthening international trade ensures American businesses like ours can compete in the global economy, building for a stronger tomorrow while insuring long-term prosperity.”

CALIFORNIA

“My company supports California’s fresh produce exporters. I used to ship up to 400 containers of grapes into Asia markets annually. But China has taken a majority of that business due to the alliances they have formed, but more importantly the zero tariffs they were able to negotiate,” said Michael Astorga, Managing Partner at Global Fruition Inc. in Pacific Grove, Calif. “The Trans-Pacific Partnership should help re-establish dominance for California fresh produce by reducing tariffs and other trade barriers and establishing common, enforceable standards and protection for U.S. companies.”

“Small businesses that export perform better and contribute more to the economy than those that do not,” said Kimberly Benson, the Vice President of Cange International in San Diego. “Yet because of budget and resource constraints, only five percent of small businesses are currently exporting. The Trans-Pacific Partnership would significantly help small businesses export by leveling the playing field, making it faster, cheaper and easier to access new markets.”

“High tariffs on American-made technology products make it difficult for American businesses to compete with domestic suppliers in Asian markets. For example, IT products are taxed up to 35 percent in TPP member countries, and high-tech instruments are taxed up to 25 percent,” said Masa Ishii, Managing Director of AZCA, Inc. in Menlo Park, Calif. “The agreement eliminates tariffs in the member countries on products manufactured in America, opening doors into markets U.S. businesses were previously unable to compete in.”

“Linking local companies to international trade is a key driver of economic growth in the Capitol Region. The TPP will help local businesses participate in the global economy, which helps grow, strengthen and diversify our economy. And that means more jobs and a brighter future for the Sacramento region,” said Patrick Mulvaney, Chef at B&L Restaurant in Sacramento, Calif.

“The Trans-Pacific Partnership is important to small pharmaceutical companies and our ability to bring the next generation of medicines to the global marketplace. We are particularly interested in provisions that strengthen intellectual property protection,” said John Rodenrys, Executive Director of R&D for Leading Biosciences, a San Diego based biopharmaceutical company advancing a novel therapeutic in development for widespread conditions, including postoperative ileus, surgical adhesions, acute shock and multiple organ failure. “Now that the USITC has delivered their report, I urge Congress to pass the trade agreement quickly to help more small companies like ours.”

“As a small business, we face significant challenges with selling our shoes and services in other countries. Small businesses have fewer resources to handle these challenges and are often scared of even beginning on the path to trading internationally,” said Peter Wong, CEO of Sunrise Shoes and Pedorthic Service in Sacramento, Calif. “International trade agreements help small businesses like mine live up to our full potential. When small businesses grow, we create new jobs, making the U.S. economy stronger overall.”

COLORADO

“The Trans-Pacific Partnership would address many of the international trade issues my small business faces. I believe that, over time, trade agreements not only reduce formal barriers, they also reduce some of the cultural resistance to doing business with U.S. companies. One of the most important aspects of trade, international or domestic, is the need for continuity and stability in the trading environment and this agreement provides a platform for greater stability. The Trans-Pacific Partnership would be a positive long-term agreement in many respects,” said Tim Bozic, CEO of Industrial Cooling Solutions, Inc. in Lakewood, Colo.

“Small businesses like ours stand to benefit significantly from increasing access to international trade. While larger companies can manage complicated Customs regulations and they can absorb the higher tariff costs, we have less capacity to jump the many hurdles,” said Christopher Sword, Former President of Oberalp North America, in Boulder, Colo. “Congress should pass the Trans-Pacific Partnership soon, now that the USITC report is complete.”

CONNECTICUT

“My business is expanding every day, and we’re currently interested in exporting to Vietnam and Chile, two countries that are members of the new trade agreement.  These countries represent enormous market opportunities, but we currently face a number of challenges whenever we enter new markets. The TPP would help reduce many barriers, making it financially feasible for us to enter those markets,” said Daniel Fass, Director of IIIGRT, Greenwich, Conn.

DELAWARE

“Global export is an integral part of our growth plan. In a small company where employees wear many hats, trade agreements are important in minimizing the administrative and real costs of exporting,” said Maryalice St.Clair, Vice President of Business Development, Halosil International, New Castle, Del. “In addition to complicated regulations, our company struggles with high tariffs that make our disinfectants more expensive than other products people can buy locally. It was promising to learn TPP would both ease regulations and reduce tariffs. I hope the agreement passes soon to help our small business grow and create jobs.”

FLORIDA

“My company works closely with Southern U.S. small businesses that are often part of the supply chains of larger U.S. corporations. Our job is to help them overcome obstacles to international trade,” said Astrid Kowlessar, Director of Vezta Triumph Ltd. in Miami. “International trade agreements allow small U.S. manufacturers enter global markets, both via their continued relationship with multinationals and independently. The Trans-Pacific Partnership will be a win-win for American manufacturing as it will increase small businesses’ ability to sell their products abroad.”

ILLINOIS

“Every time we do business in a new country, we must meet new standards, costing us valuable time and resources. If a pump isn’t going to explode in Chicago, it isn’t going to explode in Cordoba,” said Craig Shields, President and Chief Engineer of the Graymills Corporation in Chicago. “TPP would streamline standards, making trading abroad easier and more efficient. Our business, and the people we employ, depends on the trade agreement passing.”

MARYLAND

“While my company would benefit from doing more work internationally, the sad truth is it is just so much easier to do work domestically. But the world is changing and increasingly, there are more opportunities for growth outside the United States. It is time our trade policies reflect this reality and make it easier for U.S. businesses, particularly small businesses, to do business internationally,” said Jay Steinmetz, CEO and Founder of Barcoding Inc. in Baltimore.

LOUISIANA

“When we’re looking for new countries for our clients to export to, we start with the countries the U.S. already has free trade agreements with: those countries are oftentimes far easier to do business with than those we do not have an agreement with,” said Knud Berthelsen, CEO of Connect + Trade in New Orleans. “The Trans-Pacific Partnership will open new markets to American businesses, helping them export more so that they can grow their companies and create jobs here in the United States.”

NEBRASKA

“My company exports a variety of meat products to Asia. Some TPP countries currently tax imports of poultry products as high as 300 percent, beef products as high as 50 percent, and pork products as high as 25 percent. These tariffs make American products artificially more expensive than domestic suppliers in those markets, so it is difficult for us to compete,” said Harry Hou, New Grand Ocean International Group, Vice President of North America Region, Omaha, Neb. “TPP will reduce or eliminate many of the tariffs currently pricing us out of the market, allowing us to be cost-competitive with domestic suppliers in those countries.”

NEW YORK

“TPP would level the playing field for American businesses. For example, by establishing strong labor standards in the Pacific Rim—from eliminating forced labor and child labor, to establishing minimum wage and employment discrimination laws—it will ensure domestic companies in those markets are not gaining an unfair advantage against U.S. companies at their workers’ expense,” said May Tran, National Director of Business Development at Dart Global Logistics in Jamaica, N.Y.

“The Trans-Pacific Partnership will ensure our intellectual property is respected overseas and it will establish a structure for enforcing our patents. My company is trying to grow into more Asian markets and this trade agreement will help us greatly.  Expanding our business overseas helps us create more jobs at home here on Long Island,” said Jon Cooper, President of Spectronics Corporation in Westbury, N.Y.

OREGON

“My company provides unique solutions to the semiconductor industry around the world” said Armagan Akar, President and CEO of TESEDA Corporation in Portland Oregon. “As a small business, we see tremendous value in the protection of intellectual property rights, the harmonization of trade standards, regulatory compatibility, and the increase in cross border investment flows that the TPP bring. We believe these key factors will not only help us grow our business, but also help companies like ours protect jobs in the United States through the standardization of intellectual property protection laws and practices.”

“About 30 percent of our sales are international. Because of our success in international markets, we have been able to retain more employees,” said Russ Monk, Co-Owner, Co-Founder, and Director of Operations at High Impact Technology, LLC, in Tigard, Ore. “But international business is not without risks—there are many countries we are cautious about entering, because we can’t afford to have our innovative designs stolen. The TPP would give our small business the weight and authority of the U.S. government when it comes to managing intellectual property challenges in the Asia Pacific.”

TENNESSEE

“A recent Peterson Institute report estimates that delaying implementation of the agreement for just one year could cost the United States more than $77 billion in lost national income,” said David Macias, Thirty Tigers, President, Nashville, Tenn. “This loss would be seen on the balance sheets of small businesses like mine across the country. Delaying access to international markets means delaying our revenue and delaying our new jobs. There’s no way to know if we would be able to make up for these losses over time, so it is important Congress acts quickly to approve the Trans-Pacific Partnership.”

TEXAS

“Being part of an international supply chain, I understand the value of reducing barriers to international trade. After the products leave our small auto assembly plant, they are put onto the bigger Toyota assembly line,” said Ray Romero, President of HERO Assemblers, LP, in San Antonio. “The Trans-Pacific Partnership would reduce international barriers, which would help sell more cars around the world. Selling more cars will help us hire more workers here in San Antonio.”

“International distribution is a critical part of my company’s strategy, but we currently face challenges with selling our beverage dispensers abroad. For example, different countries have different certification standards that are burdensome to comply with,” said Luis Alvarez, President and CEO of Lancer Corp. in San Antonio. “Fortunately TPP will remove a number of barriers for companies like mine. This will allow us to create more jobs at home.”

“My company primarily does business with China, which is not currently a member of TPP. While the agreement would not have an immediate impact on my company, passage of TPP would ensure that America, not China, is setting the rules for trade in the Pacific Rim,” said Audley Logan, President of 3-C Technology LLC in Lancaster, Texas.

“We need new trade agreements, because now it feels like the rules to doing business in other countries change all the time and it is hard to keep up. My company has trouble with Customs regulations frequently. We also lose business when there are high tariffs on our products and it is very expensive to compete,” said Lucia Valdez, CEO of OMA Industries in McAllen, Texas. “If there were fewer barriers to doing business internationally, our revenue would be higher and I would be able to hire another employee.”

“Currently, American-made machinery is taxed as high as 70 percent in TPP member countries. By nearly doubling the cost of our products, these tariffs make it virtually impossible to compete with domestic manufacturers in those countries, pricing us out of the market,” said Octavio Manzano, President of Apfelbaum Industrial, Inc. in El Paso, Texas. “The TPP will support more trade to help more small businesses like mine compete in the global marketplace and create jobs for Texas workers. It is an increasingly global world and we simply need these agreements to keep us competitive.”

VIRGINIA

“International business is about 60 percent of our revenue. Our goal is to export more of our safety and regulatory subject matter expertise to other nations, but having different regulations, tariffs and fee structures currently make international business more difficult. TPP will simplify regulations in other countries to make it easier for us to do business there,” said Debbie Askin, President of Team Askin Technologies in Fairfax, Va.

“My company has a vested interest in the approval of TPP. Trade agreements provide both protection and opportunity to export our services to businesses world-wide,” said George Judd, Director of Cask, LLC in Stafford, Va. “In the twenty-first century, we must do business with those who we share common interests with, if not always common values.  Those common interests include sharing best practices, increased management and economic transparency, and support for improved standards of living through technology and infrastructure investments.”

“Doing business internationally is important to my company’s growth. I have experienced firsthand how state-owned enterprises from other countries threaten to put our company out of business,” said Dr. Amanda Sozer, the Founder and President of SNA International in Alexandria, Va. “TPP would help American businesses compete on a level playing field internationally.”

WASHINGTON

“Every product we sell overseas helps us hire more Washington-state workers and pay them competitive wages,” said Anil Amlani, the Senior Vice President of Global Sales at FUJIFILM SonoSite, Inc. in Puget Sound, Wash. “We need Washington to improve international trade policies so we can continue to reach healthcare providers and patients all over the world. More international trade could create more opportunities for our business and many other Puget Sound businesses, both big and small. This is a win-win.”

“As a smaller business that has been making, selling and installing garage doors since 1946 in Washington State, Northwest Door has in the last dozen or so years has exported to Canada, but had little idea that there was further opportunity to export its doors beyond nearby Canada. After several years of work we now have exported to nine countries and specifically have identified significant opportunity in the Pacific Rim region. We need a level playing field to help us realize this growth and the new jobs and higher wages this growth can bring to our employees and local suppliers,” said Jeff Hohman, President of Northwest Door in Puyallup, Wash.

WISCONSIN

“Our family business sells fire pumps, fire trucks and emergency response equipment to over 100 countries every year,” said Ryan Darley, International Sales Manager of W.S. Darley & Co. in Chippewa Falls, Wisc. “Trade agreements help us operate on a level playing field in certain countries where tariffs and other trade barriers would otherwise make selling very difficult.  Additional trade agreements, like the Trans-Pacific Partnership, would do great things for my business and for the U.S. economy.”