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Free Trade Agreements Stymied by Political Roadblocks

Organized labor - in industries that are a vital part of the U.S. supply chain - is worried that the three FTAs currently on the table won't deliver on their promises to create jobs and increase U.S. competitiveness.

July 2011
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The U.S.-Colombia FTA also promises to provide more U.S. jobs, increased U.S. exports, and enhanced U.S. competitiveness. Specifically, more than 80 percent of U.S. exports of consumer and industrial products to Colombia would become duty-free immediately upon enactment of the FTA, with remaining tariffs phased out over 10 years.

Key U.S. exports that would gain immediate duty-free access to Colombia include almost all products in the following sectors: agriculture and construction equipment, aircraft and parts, auto parts, fertilizers and agro-chemicals, information technology equipment, medical and scientific equipment, and wood.

Additionally, many agricultural commodities exported from the United States would become duty-free immediately, and virtually all remaining tariffs would be eliminated within 15 years. Colombia would immediately eliminate duties on wheat, barley, soybeans, soybean meal and flour, high-quality beef, bacon, almost all vegetable products, wheat, peanuts, cotton, and most of the processed foods products from the United States.

The U.S.-Panama agreement also is motivated by the intention of supporting U.S. jobs, expanding markets, and increasing U.S. competitiveness. More than 87 percent of U.S. exports of consumer and industrial products to Panama would become duty-free upon enactment of the FTA, with remaining tariffs phased out over 10 years. U.S. products that would gain immediate duty-free entry into Panama include information technology equipment, agricultural and construction equipment, aircraft and parts, medical and scientific equipment, environmental products, pharmaceuticals, fertilizers, and agro-chemicals.

U.S. agricultural exports to Panama also would benefit, with 56 percent of current trade obtaining duty-free treatment immediately and the rest of the tariffs being phased out over the next 15 years. Duties will immediately be eliminated on high-quality beef, frozen turkeys, sorghum, soybeans, soybean meal, crude soybean and corn oil, almost all fruit and fruit products, wheat, peanuts, whey, cotton, and many processed products.

Protection of Labor Rights and the Environment
All three agreements address a commitment to protect labor rights and the environment. In a fact sheet published by the Office of the United State Trade Representative, the Korean agreement "sets a high standard for protection of workers' rights in trade agreements - including obligations for Korea to respect fundamental labor rights, not to weaken the laws that reflect those rights in any way, and to effectively enforce labor laws designed to ensure a level playing field for U.S. workers to compete. Both the Colombia and Panama agreements have similar provisions.

As for the environment, the Korea treaty fact sheet states: "Under the agreement, the Korean government.will be held to the same level of accountability for meeting environmental commitments as it is for meeting other commitments in the agreements." There is similar wording in the Colombia and Panama FTAs.

Moving Forward
The man in the middle clearly is the President. There is no question the economy, which sorely needs help, can benefit from the enactment of these treaties. Yet, the labor unions oppose passage. The ability of the administration to find a solution will spell the future of these three agreements.

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