MRAA and ORR Support Sound Trade Policies, Warn Against Tariff Impacts
Monday, September 24, 2018
Posted by: William Higgins
While the outdoor recreation industry supports fair international trade policies and efforts to protect U.S. business interests in the global market, recent trade policy developments have threatened continued growth in this critical $673 billion industry. We understand the Administration’s efforts to safeguard U.S. intellectual property and balance unfair trade deficits, however recent tariffs have prompted significant cost increases from our steel, aluminum and component part suppliers leading to reduced domestic sales while putting our export-based businesses at risk. These tariffs ultimately result in higher consumer prices for outdoor recreational products, as well as tightened profit margins for the growing industry.
The outdoor recreation sector is comprised of a diverse collection of U.S. and foreign manufacturers of an array of products frequently used by outdoor recreationists. These products – including hiking and camping equipment, as well as a variety of other motorized and non-motorized recreational products – are engineered and designed to meet exacting U.S. environmental and safety standards, many of which have been adopted by our trade partners. Some of these products/components are manufactured in the U.S. and exported to foreign markets, while others are produced abroad and imported to the U.S. Given this reality, these manufacturers are significantly impacted by the imposition of domestic and retaliatory foreign tariffs on both component parts and finished products. Further, price increases and supply chain disruptions that result from tariffs will likely make U.S. manufacturers less competitive in the global marketplace.
Combined, the robust outdoor recreation industry comprises 2% of the U.S. GDP – surpassing other sectors such as agriculture, petroleum and coal, and computer and electronic products. The Department of Commerce’s Bureau of Economic Analysis (BEA) reported in February 2018 that the outdoor recreation sector is an economic powerhouse that supports 4.3 million jobs, and accounts for $673 billion in annual gross domestic output. In addition, BEA found the outdoor recreation economy grew by 3.8 percent in 2016, exceeding the 2.8 percent growth of the overall U.S. economy during the same period. Numerous initiatives and efforts of the Administration have helped fuel the outdoor recreation industry’s growth, but current trade policies now pose significant challenges.
ORR continues to work with the Administration and Congress to emphasize the impact of trade policy on the growing outdoor recreation industry as policymakers strive to address a structural, global issue and legislate in this arena. It is clear that outdoor recreation is one of the largest engines of economic growth that consistently creates many jobs for hardworking rural Americans while also reducing the trade deficit; however, trade uncertainty is threatening this trajectory. ORR will be a valuable resource to the Administration and the Congress in the development of impactful and sound trade policies.
If you have any questions about legislative issues, or something happening in your state, please contact Will Higgins.