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Foreign Trade

Industry Outlook

The most important factor determining the outlook for foreign trade is the status of trade agreements. When trade agreements are being negotiated or come up for a vote in Congress, various interest groups sometimes apply pressure for the inclusion of terms favorable to their constituents. For example, American labor unions often want an agreement to guarantee foreign laborers some of the protections that American workers enjoy. This is not entirely a humanitarian gesture. Manufacturers located in the U.S. are often at a competitive disadvantage with offshore manufacturers who are far less burdened with laws requiring a decent minimum wage, worker safety measures, and protection of unions. If offshore producers are required to pay these expenses, American manufactures are less likely to shift production overseas. In January 2017, President Trump withdrew the United States from the Trans-Pacific Partnership as part of his promise to bring jobs and manufacturing back to the United States.

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