Oregon loses from a trade war

Associated Oregon Industries
Oregon’s largest business advocate

Supporting Oregon Trade in an Uncertain Environment

Oregon ranks high on lists of trade-dependent states. For most of the past three decades that has been a good thing, as global trade has been a driver of economic growth. But with the Trump Administration pondering a rewrite of federal trade rules, Oregon is high on another list: states with the most to lose from a trade war.

A Brookings Institution report listed Portland as one of 15 U.S. cities with at least $25 million in exports in 2015. But even that statistic understates the reliance of Portland, and the rest of Oregon, on trade. Portland was one of the smallest metropolitan areas on the list. Portland, like other West Coast cities, sends many of its exports to Asia, and President Trump already has withdrawn the U.S. from the Trans-Pacific Partnership. Also, trade-related jobs produce some of the highest wages in Portland and the rest of the state.

Add it all together, and the Brookings report ranks Portland as the second most trade-dependent large metro area. Outside the Portland area, trade is key to the health of Oregon’s agriculture industry. About 40% of farmgate cash receipts in the state come from exports, according to the U.S. Department of Agriculture.

Oregon has little direct influence on the Trump Administration. But there are actions within the state’s control that could help businesses that depend on trade.

The Port of Portland took a step last week that could help importers and exporters, announcing that it and ICTSI Oregon, Inc. have mutually agreed to terminate a 25-year lease that allowed ICTSI to operate the container facility at the Port’s Terminal 6. The Port and ICTSI signed the lease in 2010. The new agreement allows ICTSI Oregon to be relieved of its long-term lease obligations effective March 31, 2017, pending approval by the Port Commission.

Once the lease is terminated, the Port again will control operations at Terminal 6. The divorce between the Port and ICTSI separates the Port from the strained relationship between ICTSI and the International Longshore and Warehouse Workers Union. The union’s work slowdowns, which began in 2012, played a significant role in the decisions made by Hanjin Shipping Co. and Hapag-Lloyd to withdraw from Portland in the spring of 2015.

Ongoing Legislative deliberations over a transportation package provide another opportunity to enhance trade between Oregon and other countries. One of the four subcommittees created by the Joint Committee on Transportation Preservation and Modernization is focusing on intermodal infrastructure. The subcommittee is exploring needs at Oregon ports, the possibility of adding intermodal transfer facilities and various issues related to rail service – all of which are important to importers and exporters.

While Oregon can’t control what happens in Washington, D.C., it’s crucial that the state do all it can to preserve and enhance the state’s trade ties. Improving Oregon’s import and export infrastructure is an important step in that direction.

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