BY STATE SENATOR LARRY TEAGUE –
LITTLE ROCK – The value of produces exported by Arkansas companies went down by 4.1 percent last year, but the long-term trend for exports remains positive.
In 2014 Arkansas sent $6.9 billion worth of goods to overseas markets. That is a drop from the previous year, when Arkansas exports totaled $7.2 billion. However, it was 30.2 percent above 2009. More than 50,000 jobs in Arkansas are in industries that export products to foreign markets.
Of all the states, Arkansas ranks 38th in the value of exports, according to information compiled by the Arkansas Economic Development Commission, the federal Commerce Department and the U.S. Census Bureau.
Canada is our most important trading partner, buying more than a fifth of the state’s total exports. Canadian firms import seven of the top 10 commodities produced in Arkansas – machinery, iron and steel items, electrical machinery, plastics, vehicles, paper and cereals.
Mexico is our second biggest trading partner, buying about 11 percent of the state’s total exports. In addition to the products purchased by Canadian firms, Mexico buys dairy products, meat and pulp from Arkansas companies.
France, China, Japan, Brazil, Singapore, South Korea, the Virgin Islands and Germany round out the top 10 list of destinations for Arkansas exports.
The most valuable export product made in Arkansas is aircraft, representing almost 24 percent of the total value of our exports. Of the $6.9 billion in total exports originating in Arkansas in 2014, $1.6 billion worth were aircraft products. France, China and the British Virgin Islands were the top three destinations for aircraft manufactured in Arkansas.
Machinery represented 11 percent of our exports and electrical machinery 9 percent. Plastics and organic chemicals accounted for six percent and five percent, respectively. Meat and paper products each accounted for four percent.
The value of poultry products shipped overseas declined by 4.1 percent in 2014, reflecting the overall drop in Arkansas exports. Hong Kong was the top destination for Arkansas poultry.
Exports represent an important part of the state’s economic foundation, particularly for small businesses. In all, 2,264 Arkansas companies exported some type of product, and the vast majority of those firms have fewer than 500 employees.
Developing international trade partners benefits Arkansas in that it helps attract foreign investments in companies that locate in the state. The AEDC lists 236 Arkansas companies that are owned by foreign companies. They employ about 31,600 people, about 3.4 percent of the state’s private sector employment.
German corporations own 24 businesses in Arkansas; Japanese corporations own 16. French companies own 14 and Canadian companies own 12, according to data compiled by the AEDC.
Arkansas has trade offices in Shanghai, China and Tokyo, Japan to work with businesses in those countries that are considering an investment or a location in the state.
Recently, the governor led a delegation of Arkansas officials that visited Cuba, to prepare the way for increased trade with that country if Congress eases commercial restrictions and if Cuba loosens centralized governmental control of its economy. Cuba imports rice and poultry, so Arkansas agricultural interests would benefit if restrictions ever open that country to trade with the United States.