IV.

Trade and Economics

Many transportation innovations occurred because of the needs of the military. Nevertheless, advances in vehicle designs and infrastructure (such as bridges and roads) were soon applied to trade and commerce. The Roman road system, originally created to move troops quickly and efficiently throughout the empire, soon created a massive economic market centered on Rome. The European explorers of the 15th and 16th centuries were originally seeking new paths to the riches of the Orient when they happened on the New World. The trillion-dollar international trade business of today relies entirely on a reliable system of global transportation to meet demand and provide customers all over the world with goods and services.

International trade routes connect different countries. These routes reflect the economic interdependence of many nations of the world. Many countries are dependent on other countries for natural resources, finished goods such as automobiles and electronics, and parts for products assembled locally. Many of the world’s largest trade partners, such as the United States, Canada, Japan, Mexico, and Europe, are connected with numerous transportation services and travel routes. In Asia, Japan has strong maritime trade relations with Southeast Asian countries in order to exchange natural resources for manufactured goods. The U.S. ports of New Orleans, Louisiana, and Miami, Florida, are major ports of entry for trade with Latin American nations.

Treaties and international agreements among countries are used to protect international shipping and travel. These agreements have related to issues such as vessel standardization, allowable ports of entry in a nation, customs procedures, tariffs that can be applied to certain commodities, and rights of passage through international waters. A recent example of such an agreement is the North American Free Trade Agreement (NAFTA), which was signed in 1992 by the governments of Canada, the United States, and Mexico. Among other actions, NAFTA eliminated many tariffs, allowed Mexican trucks to travel into the United States, provided safety and regulatory standards for trucks and buses, and permitted U.S. and Canadian investment on a limited basis in Mexican transportation firms. Similar trade agreements will continue to characterize international transportation.

Besides the economic benefits associated with trade, there are many other indirect economic benefits related to transportation. More than 9.5 million workers are employed in transportation-related industries in the United States, and the transportation-related portion of the U.S. gross domestic product (GDP) in 2000 was $314 billion out of a total GDP of $9.9 trillion. Aerospace, naval, and automobile manufacturers are responsible for a large amount of that figure, as are the industries that supply these manufacturers, such as the steel, rubber, petroleum, and electronics industries.