As one of the United States’ principal gateways to the Asia-Pacific region, California—home to Qualcomm’s headquarters—is positioned to be one of the biggest beneficiaries of the Trans-Pacific Partnership (TPP)’s boost to regional trade.
Once the treaty takes effect, California consumers will benefit from what amounts to a tax cut as tariffs on some overseas goods are reduced, and California workers will get more of a level playing field as some rival economies overseas are required to play by the same rules.
The state already has important trade and investment ties with the TPP countries, and those ties are expected to expand thanks to this groundbreaking agreement. In 2011, exports and imports of goods and services with TPP countries supported an estimated 1,709,700 jobs in California. The TPP will help build on these trade and investment relationships and support the California jobs that depend on them. And let’s not forget about California’s strengths in trade for intangibles, like intellectual property licensing and digital products, where American companies are particularly competitive.
Of the 11 TPP countries, six (Australia, Canada, Chile, Mexico, Peru, and Singapore) are current U.S. Free Trade Agreement (FTA) partners and generate substantial trade in both goods and services, according to the Business Roundtable:
- California exported about $54.2 billion worth of goods (e.g., computer equipment; petroleum and coal products; semiconductors and components) to these six countries in 2012, accounting for roughly 34% of California's goods exports globally.
- California exported about $15.7 billion worth of services to these six countries in 2011, accounting for roughly 18% of California's services exports globally.
Congressional approval and Executive Branch implementation of the TPP agreement will help create additional market opportunities and ensure that expanded merchandise, agriculture, and intellectual property flows are subject to state-of-the-art 21stcentury trade rules.
Equally important to California workers is the fact that the TPP will help strengthen investment ties between California and all 11 TPP countries. Companies headquartered in TPP countries have already invested nearly $600 billion in the United States and employ more than 1.5 million Americans. An estimated 1,843 California businesses are branches of companies based in TPP countries—serving as an important source of business investment and job creation for California.
For instance, Canadian and Japanese companies alone employed approximately 151,200 employees in California in 2010. By removing barriers and strengthening partnerships, the TPP will encourage companies based in member countries to increase their business investment in California, supporting economic growth and jobs throughout the state.
Qualcomm is an integral part of the San Diego economy and California’s as well. The vibrant trade-dependent San Diego community needs access to international markets to continue to grow.
So we look forward to reviewing the final text of the TPP once it is published and working to support domestic ratification by the U.S. Congress and all the TPP governments.