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Trade gap narrowing; ag is a big factor

Trade gap narrowing; ag is a big factor

Agriculture is leading the way in U.S. export growth. Free trade agreements will reduce tariffs significantly. The value of U.S. export of goods and services exceeded $2.1 trillion for the first time in U.S. history.  

The United States is narrowing the gap between what it buys from other countries and what it sells overseas, says Ambassador Islam Siddiqui, chief agricultural negotiator at the Office of the U.S. Trade Representative.

“And agriculture is leading the way,” Siddiqui said at the recent Southwest Ag Issues Summit in Austin.

The Summit, sponsored by the Southwest Council of Agribusiness and the Texas Ag Forum, featured a who’s who of experts representing government, industry, farm organizations and university Research and Extension, among others, discussing critical farm policy issues.

Ambassador Siddiqui discussed free trade agreements, the Brazil cotton case, new partnerships and Russia’s entry into the World trade Organization.

The three most recent free trade agreements, Panama, Colombia and Korea, he said, will improve agriculture’s access to markets. “Two of these—Korea and Colombia—are already in place,” Siddiqui said. “We are still negotiating the final details with Panama and should be finished by the end of the year.”

He said agriculture will benefit by more than $2 billion from the three agreements. “But we have some lost ground to make up with Colombia.”

He said the agreements will reduce tariffs significantly.

He also noted that the Trans-Pacific Partnership, consisting of the United States and eight Asian Pacific countries—Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore and Vietnam—will enhance trade when barriers are removed.

He said the Brazil cotton case remains something of a quandary. An interim agreement has forestalled retaliation. “But some changes can only be done by Congress. We’ve already made the changes allowed to be made by the Secretary of Agriculture. Now, we have to make the necessary changes to provide a landing zone to negotiate final changes.”

Siddiqui said the STAX program proposed by the National Cotton Council, “has the necessary elements to address the issue.”

He also noted that before necessary changes can be made, the Senate and the House must resolve differences in proposed farm bill proposals, an action that will now be delayed at least until after the November election.

“But Brazil will continue to honor the interim agreement as long as the 2008 farm program is in place and unchanged,” he said.

Siddiqui said after more than 18 years of negotiations, Russia has been admitted to the World Trade Organization. The United States cannot benefit, however, until a Cold War amendment—the Jackson-Vanik amendment enacted in 1974—that limits trade with countries with non-market economies is repealed.

That amendment has been overturned in Congress “and awaits the President’s signature,” Siddiqui said.

Questions remain regarding Russia’s reliability as a trading partner. “Can we trust Russia? We had rather have them in the tent than outside it,” he said. “Russia will have to abide by WTO regulations, including science-based reasons for export restrictions.”

He said admitting Russia to the WTO could benefit U.S. beef exports.

Country of origin (COOL) regulations have been partly upheld in a trade dispute with Canada and Mexico. “We won on the right to require country of origin labels, but we lost on implementation.” Parties are currently consulting with Congress, he said.

“Changes in the law could be necessary if we fail to reach an agreement with Canada and Mexico.”

Siddiqui said a 2010 National Export initiative set a goal of doubling all exports by 2014. Progress toward that mark has been significant with agriculture making considerable contributions.

The initiative is bearing fruit and that data from 2011 show the value of U.S. export of goods and services exceeded $2.1 trillion for the first time in U.S. history.

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