Academic journal article Current Politics and Economics of South and Central America

Agriculture in Pending U.S. Free Trade Agreements with Colombia, Panama and South Korea

Academic journal article Current Politics and Economics of South and Central America

Agriculture in Pending U.S. Free Trade Agreements with Colombia, Panama and South Korea

Article excerpt

Recent Developments

In letters to the chairmen and ranking members of the House Ways and Means and Senate Finance Committees, the American Farm Bureau Federation on January 29, 2010, called upon these committees to expedite the approval of pending free trade agreements (FTAs) with Colombia, Panama, and South Korea. The Farm Bureau's president stated that passage of these agreements will help reach President Obama's goal of doubling U.S. exports in the next five years, and noted that these three FTAs combined represent markets for almost $3 billion in additional U.S. agricultural exports.1

On January 29, 2010, 18 Senators sent a letter to President Obama urging his Administration to submit implementing language for the three pending FTAs to Congress for approval and -to work with us to get them across the finish line." They argued that -one concrete step to actually achieving the goal of expanding exports would be to implement" these agreements, and laid out the benefits projected for U.S. total and agricultural exports once approved.2

On January 27, 2010, President Obama in his State of the Union address stated that the United States has -to seek new markets aggressively, just as our competitors are" or -we will lose the chance to create jobs." Toward this end, he said that is -why we will strengthen our trade relations in Asia and with key partners like South Korea and Panama and Colombia."

On December 14, 2009, U.S. Trade Representative Ron Kirk notified Congress of the Obama Administration's intent to enter into negotiations on the Trans-Pacific Partnership (TPP) trade agreement beginning in March 2010. Although the United States already has FTAs with four TPP participating countries (Australia, Chile, Peru, and Singapore), this new initiative will involve negotiating similar agreements with Brunei, New Zealand, and Vietnam. Some U.S. agricultural interests (particularly beef and dairy) have expressed concerns about, and opposition to, granting New Zealand exporters additional access to the U.S. market. Most, however, view Vietnam as a promising market for U.S. agricultural exports. The National Farmers Union calls for the Administration to address and not replicate the -serious problems of the previous trade agreement model" in negotiating the TPP, so that agriculture is not used -as a bargaining chip for other sectors of the U.S. economy to achieve an agreement."3

Background

The 111th Congress could consider free trade agreements (FTAs) with Colombia, Panama, and South Korea. The timing of the White House submission of each agreement will depend on when Congress completes consideration of health care reform and other high-priority legislation, and on the resolution with each country of outstanding issues (e.g., labor, tax, automobiles), some of them not directly related to an FTA. While the terms of U.S. beef access to South Korea's market might receive some attention from policymakers, the agricultural provisions in each FTA largely have been received positively by most U.S. agricultural organizations and food industry associations.

U.S. farmers and ranchers, agribusiness firms, and food manufacturers view efforts to expand commodity and food exports as vital to improving farm income and business profitability. For this reason, many U.S. policymakers since the mid-1980s have viewed negotiating trade agreements as a way of creating opportunities to increase agricultural sales overseas, primarily by seeking to lower and/or eliminate other countries' trade barriers (e.g., tariffs and quotas). To accomplish this, the United States has had to reciprocate by lowering similar forms of border protection on farm and food products imported from prospective trading partners. Because of the import sensitivity of some U.S. commodity sectors (e.g., beef, dairy, and sugar, among others) to the prospect of increased competition from foreign suppliers, the executive branch has had to take the concerns of producers of these commodities into account during negotiations, in order to secure congressional approval of concluded trade agreements. …

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