Canada sees a good deal in Colombia FTA
Canada ratified a free trade agreement with Colombia on June 21, showing that the U.S.’s northern neighbor knows a good deal when it sees it. Not so the U.S., which has been sitting on the U.S.-Colombia FTA since it was signed four years ago.
And it’s not all likely that the FTA will be submitted to Congress before the fall elections. Too many unions have campaigned against the agreement since it was first negotiated. Maybe after the elections more enlightened policymakers will realize that there’s no downside to the trade pact. After all, most Colombian goods and services – under preferential agreements – already come into the U.S. duty-free or with low tariffs. With the FTA, Colombia would immediately eliminate most tariffs on U.S. goods and phase out other tariffs.
With all the talk about President Obama’s new export initiative, leaving Colombia out of the equation doesn’t make any sense. After all, Colombia is the largest market for U.S. agricultural products in South America, according to the U.S. Trade Representative.
Canada knows that – and so do some U.S. exporters. The National Association of Wheat Growers said that the Canada-Colombia pact would be a big blow:
“U.S. wheat producers stand to lose export sales to Colombia worth up to $92 million per year, roughly half of their current market share, if the U.S.-Colombia trade agreement isn’t quickly ratified.”
Besides the economic benefits of the agreement, the pact would recognize Colombia’s role in Latin America as a defender of democratic governance. Colombia’s president-elect, Juan Manuel Santos, could be a strong American ally, following in the footsteps of President Uribe. Ratifying the FTA would go a long way in cementing this relationship.
Check out CEI’s publications on this issue.