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Inaction on FTAs Hits Agrifood Industry

by 5m Editor
26 July 2011, at 7:49am

US - Four years of trade benefits for US farmers, ranchers and food processors have been forfeited because of inaction on pending free trade agreements (FTAs) with Korea, Colombia and Panama.

This was the message from the President and CEO of teh American Meat Institue J. Patrick Boyle.

Writing in a guest column on The Hill blog, Mr Boyle said that what once were fears about inaction are now sad realties.

He said that Australia is aggressively working to beat the US to the finish line and sign a FTA with Korea, ensuring that exports of Australian meat products and other agricultural goods will have immediate market-access advantage over US products in the Korean market.

He added that the European Union’s FTA with Korea was implemented on 1 July and the US could be completely shut out of this pork market in 10 years if the country does not act soon.

Mr Boyle wrote that Colombia is also on the verge of implementing FTAs with Canada (set to go into effect on 15 August) and the European Union.

Other major agricultural exporting countries, such as Argentina and Brazil, already have preferential access to that market.

Mr Boyle said that perhaps the biggest consequence of the US government’s inaction on these FTAs is that Korea is waiting to act until the US Congress approves the agreement first.

In the meantime, opposition leaders in the Korean government are using the time to seek changes to the terms of the original pact, including retention of a 42 per cent tariff on American beef for 10 years after ratification, he said.

Mr Boyle also pointed to the that results of an impact study coordinated by the American Meat Institute that found that passage and full implementation of the Korean, Colombian and Panamanian FTAs would represent an additional $2.3 billion in exports and the creation of 29,524 new jobs in the US.

Many of these jobs are in rural areas where prospects of true economic development are seldom presented. The data also reveal that passage of the agreements could increase US exports of beef by $1.4 billion, pork by $772 million and poultry by $102 million.

“But the future for these trade deals, and their potential for job and economic growth, only diminishes as we move closer to the fall and into an election year, strife with political considerations,” Mr Boyle said.

Last week, 12 senators wrote a letter to President Obama urging the Administration to submit the pending Korea, Colombia and Panama trade agreements as soon as possible, with the understanding that they will support a separate Trade Adjustment Assistance (TAA) bill that reflects the bipartisan reforms negotiated by US House of Representatives Committee on Ways & Means Chairman Dave Camp, US Senate Finance Committee Chairman, Max Baucus, and the White House.

“In order to move this process forward, we commit to supporting cloture on the motion to proceed to such a TAA bill and closure on the bill itself,” the letter said.

“We believe that the trade agreements and TAA should receive separate up and down votes on their merits. Therefore, we urge you to separate the pending trade agreements and TAA, and immediately submit the three agreements to Congress.”