Even before President George W. Bush left office, three significant free trade agreements were completed by his administration. Nearly two years after President Barack Obama took office those FTAs are still waiting for Congressional approval.
There are glimmers of hope that some of those trade agreements will finally see some movement. The Administration recently announced that a free trade agreement (FTA) has been reached with Panama and that they established a pathway to resolve remaining issues with Colombia. These developments will clear the way for ratification of both trade deals in the near future.
Together, agreements with Panama, Colombia and Korea represent nearly $2.5 billion of additional agricultural exports from the United States and would support as many as 27,000 new U.S. jobs.
“With conclusion of this deal,” said National Pork Producers Council president Doug Wolf, “the three trading agreements – Colombia, Panama and South Korea – are ready for Congress to consider. We ask the administration to send implementing legislation for all three, and we urge Congress to approve them before its August recess.”
U.S. Grains Council (USGC) Chairman Terry Vinduska said U.S. farmers are hopeful the administration and Congress can complete ratification of all FTAs by July 1, 2011, in order for them to be implemented as soon as possible.
A news release issued March 14 from the House Ways and Means Committee stated that, “Ways and Means Chairman Dave Camp (R-Mich.) and Trade Subcommittee Chairman Kevin Brady (R-Texas) issued a joint statement saying all three pending trade agreements would pass the House with bipartisan support if the White House agreed to act on all three.
The statement came on the heels of a press conference by Senate Republican Leader Mitch McConnell (R-Ky.), Senate Finance Committee ranking member Orrin Hatch (R-Utah) and former United States Trade Representative and current Senator Rob Portman (R-Ohio) calling for the timely consideration of the pending free trade agreements with Colombia, Panama and South Korea.”
The latest advancement comes in the Panama FTA. American Soybean Association president Alan Kemper said the U.S. already has a large share of the Panamanian agricultural market and a FTA with the country would help protect that share. "Averaged across all agricultural products, the United States supplies 53% of Panamanian agricultural imports. For the commodities most important to the United States, the share is more than 80%," he said.
The Panama FTA will prevent other countries, specifically other Latin and North American suppliers, from taking some of the current U.S. share of the Panamanian market. In addition, Panama has completed a trade agreement with Canada. If this agreement goes into effect before the U.S. agreement, Canadian exporters will gain a significant competitive advantage over the United States in the market.
According to Iowa State University economist Dermot Hayes, the Panama trade agreement will add 20 cents to the price producers receive for each hog marketed, with pork exports to Panama expected to increase by about $16 million a year.
Interestingly it was early February when U.S. Trade Representative Ron Kirk testified before Congress that the administration would submit the South Korea Free Trade Agreement to Congress “within weeks.” Over two and a half months later there is still nothing for Congress to officially approve.
“The KORUS FTA will offer enormous new opportunities for our products in a market that is large and growing,”according to eight former secretaries of agriculture, who pointed out that the deal will boost U.S. agricultural goods entering South Korea duty-free to $3 billion from about $14 million now.
According to USDA, the United States currently accounts for 30% of Korea’s agricultural imports, but that is down from almost 45% in the mid-1990s.
“We have already seen our market share in Korea decline [because of other countries’ FTAs],” the secretaries said. “That trend can be reversed and, indeed, can only be reversed, through the KORUS FTA.”
Policy is one of the most important issues facing farmers today, but often the most difficult to digest. Jacqui Fatka has a passion to decode the often difficult world of agricultural policy into terms understandable for today's ag players.
Fatka joined the Farm Progress team as E-Content Editor in August 2003 after graduating from Iowa State University. Prior to full-time employment with Farm Progress, she interned at Wallaces Farmer magazine, Iowa Sen. Chuck Grassley's press office and the Iowa Pork Producers Association and freelanced for National Hog Farmer. She also worked as a public relations consultant with Iowa Industries for the Future, an effort to bring together major players in the biorenewables industry.
Currently Fatka is a staff editor at a sister publication, Feedstuffs. For Farm Futures she regularly tells the story of ongoing agricultural policy changes. Her byline can also be found on management profiles.
Fatka grew up on a grain and livestock farm near Atlantic, Iowa. She currently lives in central Ohio with her husband Eric, and their three children - Josiah, Spencer and Avonell.
Powered by iNet Solutions Group ©2011 All Rights Reserved.