On Tuesday, the Free Trade Agreement (FTA) between the United States and Colombia was officially implemented.
"Beginning today, U.S. agricultural exporters receive duty-free access on more than half of the products we currently export to Colombia, and virtually all remaining tariffs will be eliminated within 15 years,” said Agriculture Secretary Tom Vilsack. “Estimates show that the tariff reductions in the U.S./Colombia Trade Promotion Agreement will expand total U.S. exports by more than $1.1 billion, supporting thousands of additional American jobs while increasing U.S. GDP by $2.5 billion. For agriculture, the agreement with South America's third-largest economy achieves two key trade objectives for the United States: it immediately provides vastly improved access to Colombia's market, and it levels the playing field with respect to third-country competitors.
“Last year, the United States exported $1.1 billion of agricultural products to Colombia. Under the agreement, American farmers and ranchers can expect to see their exports grow by more than $370 million, or more than one-third of the current total. Colombia will immediately eliminate duties on wheat, barley, soybeans, soybean meal and flour, high-quality beef, bacon, almost all fruit and vegetable products, wheat, peanuts, whey, cotton, and the vast majority of processed products. The Colombia TPA also provides duty free tariff rate quotas (TRQ) on standard beef, chicken leg quarters, dairy products, corn, sorghum, animal feeds, rice, and soybean oil. Over the next few years, as additional barriers fall and more U.S. businesses market products to Colombia's expanding economy, American agricultural exports will create new opportunities for our businesses, workers, farmers and ranchers, thereby supporting more and better jobs for Americans.”
U.S. wheat interests were among commodity groups praising the implementation.
“This is a very good day for wheat farmers,” said Randy Suess, a wheat farmer from Colfax, Wash., and chairman of U.S. Wheat Associates (USW). “The tariff situation has basically forced our largest customer, historically, in South America to buy more wheat from Canada and Argentina. Now our customers in Colombia will not have to pay the tariff, and we can compete equally on the basis of quality, supply and service.”
Implementing this FTA is particularly important to U.S. wheat farmers, who rely on exports to market about half of their crops each year.
“A lot of people have joined us in working hard to get the U.S.-Colombia agreement approved by Congress, signed by (President Obama) and now implemented,” said Erik Younggren, a wheat farmer from Hallock, Minn., and president of the National Association of Wheat Growers (NAWG). “While the process of removing our trade barriers with Colombia has been a long one, we are eager to get this market back on track.”
For more on recent FTAs, see here.