Timely testimonial: Maryland exec tells House Committee small manufacturers can reduce trade deficit
National Association of Manufacturers -- Manufacturing Business Technology, 6/24/2008 6:00:00 AM
With a little help from Washington, small manufacturers can provide a dramatic boost to U.S. exports, reduce the trade deficit, and foster job creation.That's what a small manufacturer told the House Committee on Small Business on June 19.
Charles Wetherington, president of Hanover, Md.-based BTE Technologies—speaking for the National Association of Manufacturers—told the committee the U.S. exported $982 billion in manufactured goods in 2007—that is, 60 percent of all U.S. exports of goods and services. “Last year, exports accounted for 40 percent of GDP growth, offsetting the housing decline,” he said.
But manufacturers—especially small manufacturers—can contribute much more to reducing the trade deficit, Wetherington went on to say.
“Given the likelihood of continued large imports of oil and foreign manufactured goods, we need a huge ramp-up of our exports, most of which will have to be manufactured goods. We need a national export expansion strategy designed to achieve a large and sustained increase in our exports,” he said.
Wetherington added that his company is an example of how a small domestic manufacturer can grow by expanding exports. “Since 2002, our exports have grown 10 times from 3 percent of our revenues to 35 percent. We currently export to 28 countries around the world.”
However, Wetherington added, the vast majority of small manufacturers do not export because they lack the expertise and resources to access foreign markets. He cited the examples of Great Britain and Australia as nations that actively fund aggressive export programs for smaller companies. “While U.S. export promotion programs provide little if any financial assistance to exporters, our competitors have a totally different philosophy about promoting exports.”
Investment in exports brings a big payoff, Wetherington added. Every federal dollar invested generates $100 in exports. Since 1997, one U.S. effort, the Market Development Cooperator Program (MDCP), has generated $2.65 billion in exports while spending less than $20 million.
“I estimate that amount of exports generated additional tax revenue to the U.S. government of almost $100 million, not a bad return on the taxpayers’ investment,” said Wetherington.
Wetherington also stressed the importance of discouraging currency manipulation by our trading partners, simplifying standards and regulatory issues, and enacting more multilateral and bilateral free trade agreements. “Our free trade agreements have opened foreign markets to U.S.-made goods,” he concluded.
Access the complete Wetherington testimony text.
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