As the U.S. Ambassador to Australia, I have gained an even greater appreciation for the vast potential the Asia-Pacific region holds to benefit our communities, both in my home state of Maryland and across the United States. Maryland may seem far from the hustle and bustle of Asia, but a new trade agreement on the horizon is set to bring our state closer to some of the fastest growing markets in the world — helping to increase our exports and supporting additional higher paying jobs for Americans.
Trade Promotion Authority — or in Washington speak the "Bipartisan Congressional Trade Priorities and Accountability Act of 2015," which the House passed Thursday — would pave the way for completion of the Trans-Pacific Partnership (TPP) trade agreement.
TPP will link the United States with 11 other countries in the Asia-Pacific region that together make up nearly 40 percent of the world's GDP and about a third of global trade. The Asia-Pacific will soon account for two thirds of the world's middle class; they will be able to afford the high-end goods and services that the United States produces.
What does the TPP mean for Maryland? Despite our small size, Maryland is home to more than 7,000 companies that ship their products overseas. Last year, these companies exported $12.2 billion worth of goods to the rest of the world, more than double what we sent out 10 years ago. Even more important, these exports support almost 60,000 jobs here in the state, and on average, export-related jobs pay up to18 percent more than non-export-related jobs.
Lest you think that this is just a deal for big multinational corporations, the vast majority of Maryland's current exporters — 89 percent — are the small- and medium-sized companies employing fewer than 500 people, the kind of businesses that make up the backbone of the U.S. economy. Exporting is a tool that can support — and help expand — any business. But smaller companies can find it difficult to navigate the complexities of overseas trade and investment regulations. The TPP will help simplify that process, with an entire chapter devoted to making it easier for small businesses to reap the benefits of the agreement.
This is extraordinarily important for Marylanders. Almost one-third of all state exports, $3.8 billion, last year went to the 11 other TPP countries. Finalizing the TPP will position our state to take that number even higher. The TPP has the potential to open up Japan, which is both one of the biggest markets and one that has traditionally thrown up very high barriers to our products. It would also provide entry to the markets of countries like Vietnam and Malaysia, whose middle classes are growing at an unprecedented rate.
The Asia-Pacific region is evolving rapidly, and we must make sure that the way we conduct commerce in the region keeps pace. Failure to grant the president Trade Promotion Authority, needed to complete and approve TPP this year, would disadvantage American workers and businesses, not least because other regional contenders, like China, would move in to fill the void left by the U.S.
Over 70 free trade agreements in the Asia Pacific region have been signed in recent years; only three include the United States. And other countries in the region continue to pursue even more deals that don't include us. None of these other agreements match the high standards of the TPP. The TPP agreement that we are currently negotiating puts in place new, strong and enforceable trade rules that set high standards on labor and the environment, protect the intellectual property that supports so many jobs in our innovative industries, and ensures that the deck is not stacked against American companies and in favor of foreign state-owned enterprises.
Maryland's companies and workers, and the nation as a whole, are positioned to benefit from the economic rise of the Asia-Pacific. Without the Trans-Pacific Partnership agreement, however, we will be at a significant disadvantage. If the United States, Australia and other like-minded countries don't set the rules of the road for trade and investment, we condemn our workers, our businesses and our investors to second-rate status in the fastest-growing region in the world.
Over our history, the United States has been many things. Second rate has never been one of them.
John Berry is the U.S. Ambassador to Australia; Twitter: @USAembassyinOz.