The three pending free trade agreements (FTAs) would greatly expand access for America’s agriculture producers in developing markets. Enacting the FTAs would create 18,000 new jobs in the agriculture sector alone.1 Unfortunately, three years after the agreements were negotiated, President Obama has yet to submit any of them to Congress. America’s farmers and ranchers continue to lose market share as the President and Senate Democrats further delay the agreements by insisting they be tied to spending increases.
Korea: Korea is the fifth largest market for U.S. agriculture products and accounted for $5.3 billion in U.S. agriculture exports in 2010. According to the U.S. International Trade Commission, U.S. agriculture exports would increase by approximately $2 billion to $4 billion if this trade agreement were enacted.2 In addition, implementing the U.S.-Korea FTA would create 9,000 new agriculture jobs in the United States.3 Other highlights include:
· Elimination of Korea’s 40 percent tariff on beef in equal installments over a 15-year period. Beef exports to Korea would likely increase by as much as $1.8 billion.4
· Elimination of the 25 percent tariff on 90 percent of pork products by 2016, and elimination of the 22.5 percent tariff on other pork products within 10 years.5
If the U.S.-Korea agreement is further delayed, U.S. agriculture producers will continue to lose market share to foreign competitors such as the E.U. The E.U.-Korea trade agreement, which would phase out 94 percent of Korea’s tariffs on E.U. products, took effect on July 1st.6
Colombia: Since the U.S.-Colombia FTA was negotiated in November 2006, U.S. agriculture exports to Colombia have dropped by 50 percent due to delays in implementing this agreement.7 Meanwhile, the Canada-Colombia trade agreement is scheduled to take effect on August 15, 2011, which will further reduce the already diminished U.S. share of the Colombian market.8
While most of Colombia’s agriculture exports to the U.S. already enter duty-free through the Andean Trade Preferences Act, most U.S. agriculture exports to Colombia face stiff tariffs. If the FTA were enacted, many of these tariffs would be immediately eliminated, and U.S. agriculture exports to Colombia could increase by $370 million per year.9 Other highlights include:
· Immediate elimination of tariffs on 77 percent of agriculture exports to Colombia; and most other tariffs on agriculture exports will be reduced over a 15-year period.10
· Immediate elimination of the 5 to 20 percent tariff on most vegetables, wheat, barley, and soybeans, plus a 12-year phase out of the maximum 25 percent tariff on corn.11
· Immediate elimination of the 80 percent tariff on prime and choice cuts of beef, and a five-year phase out the 20 to 30 percent tariff on most pork products.12 Beef and pork exports to Colombia would increase by an estimated 46 percent and 72 percent, respectively.13
Panama: Enacting this agreement would result in $195 million in increased annual U.S. agriculture exports to Panama, which already account for over half of Panama’s agriculture import market.14 On average, a 15 percent tariff is currently applied to most U.S. agriculture exports to Panama while most of Panama’s exports to the U.S. enter duty-free.15 Other highlights include:
· Immediate duty-free access for two-thirds of U.S. agriculture exports including high quality beef, soybeans, poultry products, most fresh fruits, and most processed foods.16
· In general, most of the remaining tariffs would be phased out over 17 years.17
· Immediate duty-free access for a set amount of corn, and elimination of the out-of-quota 40 percent tariff over 15 years.18
· Elimination of the 90 percent rice tariff over 20 years.19
· President Obama continues to delay these common-sense trade agreements for his own political gain, and America’s agriculture producers are paying the price.
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1 “Ag groups: Three pending free trade agreements need action,” Jennifer Latzke, High Plains Journal, http://goo.gl/sXb74.
2 “The Proposed U.S.-South Korea Free Trade Agreement (KORUS FTA): Provisions and Implications,” Congressional Research Service, May 2, 2011, http://goo.gl/7LNzf.
3 Supra Note 1, http://goo.gl/sXb74.
4 Supra Note 2, http://goo.gl/7LNzf.
5 Ibid
6 “Pending Free Trade Agreements,” American Farm Bureau Federation, June 2011, http://goo.gl/xhN0H.
7 “AFBF Advocates Passing FTAs at World Trade Month Event,” American Farm Bureau Federation, May 24, 2011, http://www.fb.org/index.php?action=newsroom.news&year=2011&file=nr0524.html.
8 “As trade pact with US sits, Colombia looks to China, others,” Howard LaPranchi, Christian Science Monitor, June 18, 2011, http://goo.gl/TzVyf.
9 Supra Note 6, http://goo.gl/xhN0H.
10 “Fact Sheet: U.S.-Colombia Trade Promotion Agreement Overall Agriculture Fact Sheet,” United States Department of Agriculture (USDA), Foreign Agricultural Service, September 2009, http://goo.gl/RxiyK.
11 Ibid
12 “Trade Agreement Would Promote U.S. Exports and Colombian Civil Society,” Juan Carlos Hidalgo, Cato Institute, February 15, 2011, http://www.cato.org/pub_display.php?pub_id=12783.
13 Ibid
14 “Agriculture in Pending U.S. Free Trade Agreements with Colombia, Panama, and South Korea,” Congressional Research Service, February 14, 2011, http://goo.gl/qEP02.
15 “The Proposed U.S.-Panama Free Trade Agreement,” Congressional Research Service, May 23, 2011, http://goo.gl/i9E3s
16 Supra Note 14, http://goo.gl/qEP02.
17 Ibid
18 “U.S.-Panama Trade Promotion Agreement,” the White House, http://goo.gl/paE9Q.
19 Ibid
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