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U.S.-Colombia trade deal on hold after House vote

By DAVE BLOWER JR.
Farm World Editor

WASHINGTON, D.C. — After President Bush sent the U.S.-Colombia Trade Promotion Agreement to Congress on April 8, House Speaker Nancy Pelosi answered back with a proposal to change Trade Promotion Authority (TPA) rules by removing the 90-day timeline for mandatory consideration of the trade pact.

On April 10, the House, in a vote of 224-194, adopted the proposal, which removes any timeframe for consideration of this agreement.

“Today’s action by Speaker Pelosi is bad for America’s economy and most of all bad for American farmers,” said USDA Secretary Ed Schafer. “Trade is vital to the strength of our agricultural economy, and free trade agreements like the one with Colombia are critical to continued growth in agriculture. Colombia is the largest market for our agricultural exports in South America. It bought a record $1.2 billion of our agriculture products in 2007. Meanwhile, the trade situation between our countries has become one-sided, as Colombian food and agricultural products come into the U.S. with no duties whatsoever.”

Schafer said American goods are subject to numerous tariffs and duties in Colombia. The Colombian free trade agreement, he added, levels the playing field for U.S. farmers and ranchers, by removing duties on more than 70 percent of agriculture products immediately. U.S. farm exports to Colombia that will receive immediate duty-free treatment include high quality cuts of beef, cotton, numerous fruits and vegetables, wheat, and soybeans.

“Overall, our farmers and ranchers stand to gain a great deal by implementing the Colombia Free Trade Agreement,” he explained.
The American Farm Bureau estimated that this agreement, when implemented, would benefit U.S. agriculture with $690 million in gains annually, generating another $1.8 billion in economic activity and supporting nearly 9,000 American jobs.

Schafer said Colombia has a growing economy and appetite for the kind of commodities U.S. farmers excel at producing. In fact the National Beef Cattlemen’s Assoc. (NCBA) said the Colombian trade deal would have been particularly good for U.S. beef producers.
“NCBA supported Trade Promotion Authority for President Clinton and President Bush, and we will support it for whichever candidate occupies the Oval Office in 2009,” NCBA President Andy Groseta said. “TPA isn’t supposed to be about delaying or avoiding votes on specific trade agreements. Its about taking action in a timely fashion, to give our nation the tools it needs to negotiate and implement agreements effectively.”

Groseta added that the NCBA remains firm in its commitment to the U.S.-Colombia Trade Promotion Agreement and believes it is one of the best-negotiated free trade agreements for U.S. beef. He said the agreement will provide immediate duty-free access to U.S. prime and choice beef and will remove all other tariffs on beef products over 15 years. Once fully implemented, the Colombian market has potential to equal roughly $10-$20 million a year for the U.S. beef industry.

Schafer said the agricultural community recognizes the enormous potential of this agreement, which is why more than 40 agricultural and food associations have voiced their support for the Colombian FTA.

“Our farmers and ranchers depend upon exports for their financial well-being, and failing to act on this agreement could affect markets, disappoint our trading partners, and hinder our efforts to get American crops to consumers around the world,” Schafer exclaimed. “American Farmers deserve a level playing field when it comes to trade with Colombia. Implementation of the Colombia Free Trade Agreement is the right thing to do for America’s economy and its right for America’s Farmers.”

Ken Hobbie, U.S. Grains Council president and CEO, said Colombia is already the second-largest market for U.S. farm products and the sixth largest market for U.S. corn. He said the agreement would afford the United States the opportunity to export co-products, such as distiller’s dried grains with solubles and corn gluten feed to Colombia. “With the passage of free trade agreements with Colombia, as well as the pact with Panama currently awaiting approval, the United States ultimately will broaden market access for U.S. feed grains to over two-thirds of the population in the Western Hemisphere,” said Hobbie.

This farm news was published in the April 16, 2008 issue of the Farm World, serving Indiana, Ohio, Illinois, Kentucky, Michigan and Tennessee.
4/16/2008