MercoPress. South Atlantic News Agency

US farmers lobby strongly for FTA, which could generate 22.500 jobs

American Farm Bureau Federation President Bob Stallman

The inability of the United States Congress and the administration to move three stalled free trade agreements is hurting US economic growth, testified American Farm Bureau Federation President Bob Stallman before the House Agriculture Committee.

Stallman said the combined Korea, Colombia and Panama agreements would add nearly an additional 2.5 billion to the US economy through agricultural trade.

Once fully implemented, the Korea free trade agreement would trigger 1.9 billion US dollars annually in agriculture exports. Gains in exports through the Colombia agreement are estimated at 370 million USD, while the Panama agreement is estimated to increase U.S. agricultural exports to more than 46 million USD.

“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 US 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 US Agriculture Department estimates that every billion dollars in agricultural exports supports 9,000 US jobs. By passing all three FTA, up to 22,500 new U.S. jobs could be created.

While the agreements have been stalled for years there has been a proliferation of trade deals negotiated by US competitors doing business with the three countries have put US agriculture at a disadvantage. Billions of dollars are being lost in exports to US competitors.

“The US government’s inaction has allowed our competitors to move in and displace agricultural product,” said Stallman. “The debate is no longer simply about generating potential export gains but about how to prevent the loss of existing export markets.”

For example, during the 2000-2009 period Chile’s market share of Korea’s wine imports rose from 2.4% to 21.7%, while the US share fell from 17.1% to 9.8%. This is believed to be the direct result of eliminated tariffs on Chilean wine under the Korea-Chile trade agreement.

In Colombia, the US overall agriculture market share, which peaked in 2008 at 46%, plummeted to 21% in 2010, being taken over by competitors Brazil, Argentina, Uruguay and Paraguay whose agreement went into effect in 2009.

A recently completed Panama trade deal with Canada threatens to give Canadian exporters a significant competitive edge over the US for products such as beef, pork, beans and various processed foods if the Canadian trade deal takes effect before the US 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 US producers and American workers”.