Farms.com, Canada
12-04-07
Peru Trade Pact Passage Major Victory
The National Pork Producers Council hailed as a major victory for U.S. pork
producers today’s overwhelming passage by the Senate of the free trade
agreement between the United States and Peru.
The Senate approved the Peru Trade Promotion Agreement on a 77-18 vote.
The House approved the agreement in November by a vote of 285-132. The
trade deal, which President Bush is expected to sign, is the first pact beneficial to
the U.S. pork industry passed by Congress since the Dominican RepublicCentral America Free Trade Agreement was passed in summer 2005. (Congress
did approve in late 2005 and in 2006 trade agreements with, respectively,
Bahrain and Oman.)
“Passage of the Peru agreement is a major victory for U.S. pork producers, who
will gain access to 28 million new customers and see their profits rise,” said
NPPC President Jill Appell, a pork producer from Altona, Ill.
NPPC, which led a coalition of agricultural organizations in support of the Peru
trade agreement, said the pact will provide significant benefits to U.S. pork
producers. According to Iowa State University economist Dermot Hayes,
when the agreement is fully implemented live hog prices will be 83 cents higher
than they would be in the absence of the agreement. That means profits for the
average U.S. pork producer will increase by 7 percent; U.S. pork exports to Peru
will be worth $30 million annually.
U.S. pork exports to Peru currently are restricted by duties as high as 25 percent.
Under the agreement, all pork products will see immediate reductions in tariffs.
Some pork products will receive unlimited duty-free access on implementation of
the agreement, a majority of products will see tariffs phased out over five years
and at the end of the 10-year phase-out period, all pork products will be dutyfree.
In addition to the favorable market-access provisions, significant sanitary and
technical issues were resolved. The Peruvian government, for example, agreed
in writing to recognize the meat inspection system of the United States as
equivalent to its own inspection system. The agreement also addresses labor
and environmental issues, key sticking points to congressional approval of
previous trade deals.
“We applaud Congress for recognizing the benefits of free trade and urge
lawmakers to take up other pending free trade pacts,” said Appell. “Pork
producers and all of agriculture depend on access to new overseas markets,
such as Peru.”
Also awaiting congressional consideration are trade agreements with Colombia,
Panama and South Korea, which combined would be worth nearly $12 for each
hog marketed.