AFBF: Inaction on FTAs is Hurting U.S. Economy
WASHINGTON-- The inability of Congress and the administration to move three stalled free trade agreements is hurting U.S. economic growth, testified American Farm Bureau Federation President Bob Stallman today before the House Ways and Means Committee. Combined, the Korea, Colombia and Panama agreements would add an additional $3 billion to the U.S. economy through agricultural trade.
Once fully implemented, the Korea free trade agreement would trigger $1.8 billion annually in agriculture exports. Gains in exports through the Colombia agreement are estimated at $815 million, while the Panama agreement is estimated to increase U.S. agricultural exports to more than $195 million.
“These trade agreements are not only important to the bottom line of America’s farmers and ranchers but the economic health of our rural communities and the overall U.S. economy,” said Stallman. “There is a long supply chain made up of American workers who get products from the farm gate to foreign consumers. A decline in our exports means a decline in work for those who are a part of that supply chain.”
The Agriculture Department estimates that every billion dollars in agricultural exports supports 9,000 U.S. jobs.
Because the agreements have been stalled for years, a proliferation of trade deals negotiated by U.S. competitors doing business with the three countries have put U.S. agriculture at a disadvantage.
“The debate is no longer simply about generating potential export gains but about how to prevent the loss of existing export markets,” said Stallman, who referenced the billions of dollars being lost in exports to competitors because of the stalled agreements.
For example, from 2000-2009, the Chilean wine market share in Korea rose from 2.4 percent to 21.5 percent, while the U.S. share fell from 17.1 percent to 10.8 percent. In Colombia, the U.S. overall agriculture peak market share was 46 percent in 2008, but dropped in 2010 to 21 percent, being taken over by Argentina.
A recently completed Panama trade deal with Canada threatens to give Canadian exporters a significant competitive edge over the U.S. for products such as beef, pork, beans and various processed foods if the Canadian trade deal enters into effect before the U.S. agreement.
“Inaction has proven to result in loss of market share and forfeiture of economic growth,” said Stallman. “The U.S. government’s inability to move these agreements benefits our foreign competitors while harming U.S. producers and American food supply workers.”
AFBF is urging Congress and the administration to expedite consideration of the three free trade agreements.