Work Continues on FTAs Implementation

DC Dialogue

Panama, Colombia FTAs implementation could come as early as April 2012, but politics could hold up progress.

Published on: December 23, 2011

This year brought the monumental signing of free trade agreements with Korea, Colombia and Panama. Industry and government representatives continue to work on implementation on the deals which offer promising increases in U.S. agricultural exports.

The U.S. Trade Representative office held meetings Dec. 5 and 6 with Korean working-level officials in Washington, D.C., to discuss implementation issues regarding with the U.S.-Korea Free Trade Agreement. This meeting was part of the U.S. Trade Representative office’s ongoing implementation work with Korea that to date has included videoconferences and exchanges of information on laws and regulations.

The meeting followed the November 22 approval of the agreement by Korea's National Assembly and recent Congressional approval in the United States.

USTR said it is working with all three new FTA partner countries toward bringing agreements into force. USTR is currently in the process of receiving and translating materials from Colombia regarding steps necessary to bring that agreement into force; U.S. officials are working with the Government of Panama regarding materials that need to be submitted by Panama to enable it to assess necessary steps as well. USTR officials also traveled to Colombia and Panama for meetings on Nov. 8-9 to launch FTA implementation work.

The U.S. Grain Council said it recently sent a delegation to meet with key officials in Panama and Colombia since U.S. passage of the Colombia and Panama free trade agreements (FTA).

USGC chairman Wendell Shauman, National Corn Growers Association chairman Bart Schott, were accompanied by council staff, Floyd Gaibler, director of trade policy, Chris Corry, director of international operations, and Kirk Schultz, regional director in Latin America. The team explored the outlook for FTA implementation with government officials in both countries, with private sector grain customers, and with U.S. ambassadors and USDA staff.

“The Council has been committed to regaining unfettered access to markets in both Panama and Colombia,” Shauman said. “The FTA will go far toward reversing trade flow of South American corn and soybeans moving into the Caribbean Basin.”

Schott, who spent much of his year as NCGA president working for U.S. ratification of the agreements, said, “Our purpose was to see how far those folks have gone on implementing the FTAs,” said Schott.

“In Colombia, we met with a couple of big conglomerates, and they are very excited about the new FTA. Some thought it would be implemented by April, some said June, and some said the end of the year,” Schott reported.

“Now it sounds like [implementation] will progress smoothly in Panama and Colombia, and we’ll be back exporting corn to them,” he added.

The delegation also used the opportunity to answer questions about the availability and quality of U.S. feed grains, reconciling concerns about high levels of dust and foreign material in some shipments. 

Both countries are currently sourcing corn from Argentina, and it’s very good quality, according to Shauman. However, excitement about the shipping advantage with U.S. feed grains is clear. Panamanian customers, for example, can place an order and receive their shipment within five days.

Once fully implemented, the Colombian FTA is expected to increase all U.S. agricultural exports by an additional $370 million per year. In Panama, the pact is projected to produce an additional $46 million in annual sales.