2010 marked the largest annual increase in trade between NAFTA countries according to a recent Bureau of Transportation Statistics (BTS) report. This surface trade between the US and its NAFTA partners, Canada and Mexico, reached an all-time high of 24.3% or $791 billion. Making this 24.3% the largest annual increase since BTS began collecting this data. According to BTS, surface transportation consists mainly of freight movements by truck, trail, and pipeline, with nearly 90 percent of US trade by value with Canada and Mexico by land.
More 2010 noteworthy facts about North American surface trade include:
- 13.4 percent increase in total trade value since 2005 and 27.5 percent since 2000
- 25.1 percent increase in total transportation exports, with exports increased 23.3 percent annually
- 22.1 percent increase in trade with Canada $471 billion, with Michigan as the leading state at $60.7 billion
- 27.6 percent increase in trade with Mexico at 320.3 billion, with Texas as the leading state at $114.5 billion (1st state with over $100 billion in trade with Mexico in a year)
What does this mean for US importers and exporters? Well if you are not already leveraging the benefits of NAFTA, you may want to consider it. For example, in a 2008 Deloitte Research Study that surveyed over 300 executives of leading North American manufacturing enterprises, 2/3 attribute NAFTA to the revenue growth increase and bottom-line profits of 5% or higher over the past three years. This shows that by automating NAFTA, or any other FTA, management, companies are able to realize the full savings potential of the program which directly contributes to profitability by lowering production cost, duty rates, total landed cost, etc. and increases the company’s profit margin.
If your company is considering NAFTA participation, you may want to check out these two resources – 5 Steps to Eligibility Determination Best Practices and Benefits of Automating Free Trade Agreement (FTA) Qualifications.