The White House has released more information on the status of the U.S. Panama Free Trade Agreement. Officials said on Monday a Tax Information Exchange Agreement went into effect between the two nations. The agreement permits the two countries to improve their tax information exchange transparency networks globally. Panama's government has also taken a series of legislative and administrative actions to further strengthen its labor laws and enforcement.
As part of this broader trade agenda, the Obama Administration has worked closely with the government of Panama to resolve outstanding issues related to the agreement. The FTA seeks to provide a level playing field that creates economic opportunities for U.S. workers, companies, farmers, and ranchers, and that ensures our trading partners have acceptable working conditions and respect fundamental labor rights.
White House officials say this action clears the way for the Obama Administration to begin discussions with Members of Congress about the draft implementing bill for the Agreement.
The American Farm Bureau Federation has fought hard to see the Panama Free Trade Agreement process completed and Farm Bureau President Bob Stallman points out that Panama has duty-free access to the U.S. market, while our products face excessive tariffs when sold to the Panama market. Once implemented, Stallman says the Panama FTA will level the playing field for U.S. farmers and ranchers by eliminating these tariffs.
According to Doug Wolf, a pork producer from Lancaster, Wisconsin and president of the National Pork Producers Council, with conclusion of this deal the three trading agreements – Colombia, Panama and South Korea – are ready for Congress to consider. The NPPC would like to see each agreement approved by Congress before its August recess.
Stallman says when all three outstanding free trade agreements are completed they will create expanded markets for American farm and ranch products and boost our overall economy. Together, the three agreements represent nearly $2.5 billion of additional agricultural exports from the United States and would support as many as 27,000 new U.S. jobs.
Wolf says the deal will open to U.S. pork producers, other agricultural sectors and U.S. businesses a market of almost 3.4 million consumers.
U.S. pork exports to Panama currently are restricted by a small quota and out-of-quota duties as high as 80%. Under the Panama Trade Promotion Agreement, U.S. pork variety meats would receive immediate duty-free treatment, and the trade deal would expand market access for U.S. pork muscle meat through larger tariff rate quotas that will grow by 6% annually. The out-of-quota tariffs will be phased out in 15 years, and all other tariffs on U.S. pork will be phased out over 12 years.