US state governors show concern over trade at summer meeting

Several state governors in the United States have expressed concerns about the uncertainties caused by current global trade tensions, and hope to end them through negotiation.

Democratic Colorado Gov. John Hickenlooper, right, and Republican Utah Gov. Gary Herbert talk about strategies for increasing direct foreign investment in state economies Thursday, July 19, 2018, in Santa Fe, N.M. Several governors attending the annual meeting of the National Governors Association said shifting U.S. trade policies are rattling markets for agricultural commodities and complicating decisions by foreign investors.[Photo: AP/Morgan Lee]

During the National Governors Association Summer Meeting, which has wrapped up in Santa Fe, the capital city of New Mexico State, the governors discussed ways to maintain trade relationship amid trade tensions between the United States and other economies. Several of the more than 20 governors expressed their concerns over shifting U.S. trade policies that are rattling markets for agricultural commodities.

In the past 10 years, Washington State's export to China has soared by 240 percent. Jay Inslee, the governor of Washington State, says that under the cloud of uncertainty in trade tensions, not only agriculture, but other industries will also be impacted. He says that "We are the biggest apple exporting state, and those markets have been diminished because of the responses of tariffs to the chaotic activities from the White House. Our exports of wine to China are concern. We have concerns of our manufacturing base. It is not all about agriculture but in manufacturing too. "

John Hickenlooper, the governor of Colorado, says sound trade relations serve as a motivating force for the global economy and international stability, but trade tension will destroy mutual trust. "Certainly, we've seen already the impact of uncertainty that it would reflect itself on larger capital investments. We have roughly 10% of our export, I think in some way, the tariffs are going to affect some risks. That is significant amount for us, and certainly a number of our imports are going to be more expensive if it is continued to be imported," says Hichenlooper. He thinks that is a smaller problem than that uncertainty and challenges of building a long-term expanding economic relationship.

The Chinese market is important to the 50 states in the U.S., which can be illustrated by current statistics. China ranks as one of the top five export markets of commodity and services in most states, supporting more than 1 million domestic jobs in the United States.

Stats from the U.S.-China Business Council show that, in the past ten years, 49 U.S. states have increased their exports to China, with 17 of them achieving a three-digit growth. All U.S. states' service exports to China had increased significantly and 31 states had service export growth of more than 300 percent. 

Chinese Consul General in Los Angeles Zhang Ping says the state of New Mexico alone exported more than 1 billion U.S. dollars of goods to China in 2017, doubling the amount of the previous year and supporting nearly 4,000 local jobs.

In Arkansas, the state's service export to China increased by 370 percent in the last decade. Asa Hutchinson, the governor of the State, says "Both countries need to show a lot of maturity and patience, and probably make some concessions. I think it is important that we look for a solution very quickly so we don't have an increase in tariffs and escalate the tariff war, as some would describe it. The more we can build the relationship at the state level, then the more successful at the national level." Hutchinson adds that Arkansas officials are working with federal government agencies to try to maintain the sound trade ties between their state and China.

All 50 U.S. states sent representatives to the three-day meeting in Santa Fe. Delegations from China, Canada, Kenya, Japan and Mexico also participated in the NGA Summer Meeting.