USTR Explains Delay To FTA With Colombia

At a hearing of the Subcommittee on Trade of the House of Representatives’ Committee on Ways and Means, the Deputy United States Trade Representative (USTR) Miriam Sapiro explained the reasons for the continued delay to the presentation of the free trade agreement (FTA) with Colombia.

The FTA with Colombia was originally concluded in 2007 and it is generally agreed that it would open new markets to US exports. The US International Trade Commission has estimated that implementing the agreement would increase US exports by USD1.1bn and add USD2.5bn per year to US gross domestic product.

However, it was noted that Colombia has, since then, concluded trade agreements with major trading partners and export competitors of the US, which could, in turn, severely disadvantage US exporters and jeopardize US job creation. For example, the Canada-Colombia trade agreement is expected to enter into force around July 1 this year, removing significant Colombian tariffs for Canadian agriculture exporters while similar tariffs remain in place against US agriculture exports.

In announcing the hearing, the Subcommittee’s Chairman Kevin Brady said: “The US cannot afford to sit on the sidelines while Colombia implements trade agreements with other major countries. We need a concrete plan now from the Administration for moving forward with the Colombia agreement, to allow Congressional consideration of all three pending trade agreements (including those with South Korea and Panama) by July 1.”

In her statement to the Sub-committee, Sapiro pointed out that, while the FTA with Colombia holds out the prospect of substantial benefits by eliminating tariffs on US exports, in most cases upon entry into force, the agreement’s benefits go beyond elimination of those tariffs, as “it will also provide significant new access to Colombia’s services market, improve standards for intellectual property rights protection, open government procurement opportunities, and safeguard US companies in Colombia against discriminatory or unlawful treatment.”

She emphasized that the US government “has heard from a broad range of stakeholders and has subsequently made clear to Colombia that three areas of concern must be addressed: first, the protection of internationally recognized labor rights; second, prevention of violence against labor leaders; and third, the prosecution of the perpetrators of such violence.”

While the Obama Administration has been encouraged by the Colombian government’s recent actions, she said that more needed to be done. She disclosed that meetings are continuing with that government, while the Administration is also intensifying consultations with key stakeholders and members of Congress, including House and Senate leadership.

Sapiro confirmed that “we are working quickly but thoughtfully.” She reminded Subcommittee members that the President has directed the USTR "to intensify our engagement with Colombia to resolve the outstanding issues as quickly as possible this year and submit the Colombia FTA to Congress immediately thereafter.”

Source: tax-news.com