- Congress passes long-stalled Free Trade Agreements with Colombia, Panama and South Korea.
- Proponents claim U.S. exports to increase over $12 billion annually with agriculture's share some $2.5 billion.
- Deals now require ratification by governments of the three nations.
Congress has passed three long-stalled Free Trade Agreements (FTAs) with Colombia, Panama and South Korea.
Cast late Wednesday, the House votes for the trade deals were 262 to 167 for Colombia, 300 to 129 for Panama and 278 to 151 for South Korea. The Senate tallies were 66 to 33 for Colombia, 77 to 22 for Panama and 83 to 15 for South Korea.
For more FTA coverage, see here.
With few exceptions, agriculture and commodity groups – along with the White House, which claims the FTAs will lead to over $12 billion in new U.S. exports -- have pushed hard for passage.
Following the votes, President Obama said the deals “will significantly boost exports that bear the proud label 'Made in America,' support tens of thousands of good-paying American jobs and protect labor rights, the environment and intellectual property.”
Once Obama signs the FTA legislation the deals must be approved by the governments of the three nations.
Agriculture Secretary Tom Vilsack said the FTAs mean U.S. agriculture stands to gain “over $2.3 billion in additional exports, supporting nearly 20,000 jobs here at home. Passage of the agreements also levels the playing field and secures markets for America’s farmers, ranchers, growers and producers. Immediately upon implementation of these agreements, the majority of American products exported to Korea, Colombia and Panama will become duty-free. Swift action by Congress also helped us to maintain an advantage on competitors striking their own trade deals with these nations.
“The trade agreements will also strengthen what has been a bright spot in the American economy. With record agricultural exports supporting more than a million jobs here at home, passage of these deals will contribute to a positive U.S. trade balance, create jobs, and provide new income opportunities for our nation’s agricultural producers, small businesses, and rural communities.”
Secretary of State Hillary Clinton said the agreements "will make it easier for American companies to sell their products to South Korea, Colombia and Panama, which will create jobs here at home."
After the trio of deals passed, the National Corn Growers Association (NCGA) said “statistics show passage of the three FTAs could create 250,000 American jobs and add an additional $13 billion annually in exports. The United States continues to be the largest producer and exporter of corn in the world, exporting 50.4 million metric tons last year.”
The NCGA also claimed the lengthy period it took to pass the FTAs allowed the European Union to broker a trade agreement with South Korea that took effect this summer. As a result, European exports with South Korea “have increased 36 percent from a year earlier.”
In Colombia, “U.S. farmers have already lost more than $1 billion in sales in the two years since that country implemented a trade deal with Argentina and Brazil. The Colombia-Canada Free Trade Agreement that took effect Aug. 15 has also put U.S. workers and farmers at a disadvantage.”
Bob Stallman, American Farm Bureau Federation President, said the deals represent some $2.5 billion in new U.S. agriculture exports and mean “we can restore a level playing field for U.S. farm exports to these three nations.
“Over the past four years, Korea, Colombia and Panama have opened their doors to our competitors. Congress and the (Obama) administration have now given us the opportunity to improve our competitive position in these markets. The economic growth generated from the agreements will improve our economy and create jobs here at home.”
In a joint statement, the National Association of Wheat Growers and U.S. Wheat Associates lauded the deals’ passage: “We have waited for the day these agreements would be taken up for many years now. Based on our work within the wheat industry, we know these agreements and others like them will help us rebuild and expand markets, grow our economy here at home and remain the most reliable supplier of wheat in the world. We strongly urge (President Obama) to sign these agreements quickly.”
The American Soybean Association (ASA) also weighed in.
“ASA has been working for a number of years toward passage of these trade agreements, which contain significant export gains for U.S. agriculture.” said Alan Kemper, ASA President and Indiana soybean producer. “Increased exports of U.S. soy and soy fed meat and poultry will benefit soybean farmers and rural economies. After nearly five years of delays and loss of U.S. market share, soybean farmers look forward to realizing the opportunities these FTAs provide for America’s economic growth.”
The ASA statement says the South Korea FTA “offers immediate duty-free access to U.S. soybeans for crushing and to U.S. soybean meal. It also opens up South Korea’s food-grade soybean imports to the private sector. The agreement will increase exports of the major grain, oilseed, fiber, fruit and vegetable, and livestock products by $1.8 billion annually, according to economic forecasts by the American Farm Bureau Federation.
“The Colombia FTA will create new opportunities for U.S. soybean farmers in the Colombian market by immediately eliminating tariffs ranging from 5-20 percent on soybeans, soybean meal and soybean flour, and phasing-out the 24 percent tariffs for crude soybean oil and refined soybean oil over 5 years.
“The Panama FTA will benefit soybean farmers by immediately removing the tariffs on U.S. soybeans, soybean meal, and crude vegetable oils.”
Terry Swanson, National Sorghum Producers Chairman, played up the job-producing possibilities of the FTAs.
“Given the state of our struggling national economy,” said Swanson, “an agreement that is expected to generate more than $2 billion annually to U.S. farm exports and support nearly 20,000 American jobs just makes sense.”
On the heels of the deals passage, the U.S. Grains Council (USGC) says officials will soon travel to Colombia and Panama to meet with agriculture and government officials to regain U.S. grain exports in the region.
"With a level playing field, the United States has an excellent chance of winning back these markets," said Wendell Shauman, USGC Chairman. “We have a shipping advantage from the Gulf Ports, and we have historically been a trusted partner and preferred provider for grain exports in the Caribbean Basin. It’s great to be back in the game.”