October 31, 2012
www.gfb.org
Vol. 30 No. 44
U.S.-PANAMA FREE TRADE AGREEMENT TAKES EFFECT The United States-Panama Free Trade Agreement (FTA) takes effect on Oct. 31, following what the offices of United States Trade Representative (USTR) Ron Kirk called a thorough review of laws related to the FTA’s implementation by both countries. The Panama FTA will eliminate tariffs and other barriers to U.S. exports to Panama. The Panama FTA is the third of three key international trade agreements to take effect, following those with South Korea and Colombia. “Panama is one of the fastest-growing economies in Latin America, expanding 10.6 percent in 2011, wh forecasts of between five to eight percent annual growth through 2017. That adds up to support for more well-paying jobs across the United States,” said Kirk. “The increased access to this expanding market is backed by the agreement’s strong enforcement provisions.” According to a USTR press release, the FTA calls for Panama to immediately reduce or eliminate tariffs on U.S. industrial goods, and more than 86 percent of U.S. exports of consumer and industrial products to Panama become duty-free immediately, including agricultural equipment and fertilizers. Nearly half of U.S. exports of agricultural commodities to Panama immediately become dutyfree, including wheat, soybeans, beef, bacon and almost all fruit and vegetable products. The U.S. exported more than $53 million in soybean products to Panama last year and $65 million in 2010, according to the American Soybean Association. In a related development, U.S. Agriculture Secretary Tom Vilsack has urged Congress to reinstate funding for a foreign marketing program that expired on Oct. 1. Meanwhile, Canada and Mexico have joined the U.S. as part of the Trans-Pacific Partnership (TPP) Agreement negotiations. The TPP is a proposed international trade framework involving 11 countries, including China, South Korea and Japan. The U.S. supported Mexico’s inclusion in the TPP talks unconditionally, but key U.S. agricultural organizations want concessions from Canada. In early October, a group of 49 congressmen sent a letter to Kirk asking that Canada’s barriers to imports of U.S. poultry and dairy products be subject to the negotiations. The U.S. exported $290 in poultry products to Canada in 2011, but Canada’s import protection policies limit how much U.S. poultry is sold there. The National Chicken Council and the U.S. Poultry and Egg Export Council contend that this is a violation of the North American Free Trade Agreement, and both organizations opposed Canada’s inclusion in the TPP without Canada lifting the poultry import restrictions.