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Agricultural News

Agribusiness Freedom Foundation Exec Has Strong Feelings About Opportunities Linked with TPP

Fri, 04 Nov 2016 10:18:35 CDT

Agribusiness Freedom Foundation Exec Has Strong Feelings About Opportunities Linked with TPP The following article is an opinion piece authored by Steve Dittmer, executive vice president of the Agribusiness Freedom Foundation. To contact Dittmer, email him at steve@agfreedom.org or reach him by phone at 719-495-0401.

"We've seen intelligence that various groups feel they are making serious progress lining up members of Congress to get a vote on the Trans-Pacific Trade Partnership (TPP) during the lame duck session. They'd better, as while either presidential candidate could be a trade problem in 2017, our economy needs a boost now and the competition is not idle.

"While U.S. agriculture tries to persuade Congress to even consider a long-labored-over pact with 40 percent of the world GDP in the fastest growing region of the world, Canada is leapfrogging over the U.S. on the sluggish EU negotiations. Stalled just a couple weeks ago by some political minnow in Belgium looking for attention, Canada and the EU have saved and signed a trade deal seven years in the making. Called the Comprehensive Economic and Trade Agreement (CETA), the countries termed it the 'most comprehensive, ambitious and progressive trade agreement ever negotiated by either Canada or the European Union.' The agreement is the first the European bloc has negotiated with another major industrialized economy, ('Canada, EU Sign Delayed Trade Deal,' Wall Street Journal, 10/31/16).

"The agreement is seen as a model for future economic agreements with the EU. The deal scraps almost all import duties, some 9000 tariffs, covering agricultural, food and industrial goods, saving exporters an estimated $549 million dollars/year.

"Meanwhile, America is stuck trying to get back the import quota we thought we had for non-hormone treated beef, only to have other countries horn in. Negotiations on conventional beef, cleared even by EU scientists many years ago, have languished since the 1980s. Whether considered a non-tariff trade barrier or an ill-informed European fear of science and technology, the ban on beef from hormone-treated animals has cost us many millions of dollars and only encouraged the EU's distrust of other technology, like GMOs. In fact, it was France's peasant-like fear of the 'witchcraft' of GMOs (frankenfood) that helped launch much of this ignorant fear of science decades ago.

"Yet the deal already negotiated -- TPP -- which would be a huge boost just by cutting Japan's 38.5 percent tariff -- sits waiting while poorly informed Congressmen dither over whether we should turn back the clock to pre-colonial times and renounce trade. Meanwhile, as the NCBA has pointed out, Australia beats us like a drum every day to the tune of $357,000. As House Speaker Paul Ryan pointed out, every other country in the world is negotiating and we have been involved in only two of the last 101 or so deals.

"After dragging along for months, the U.S. GDP finally woke up for a quarter (3rd) and, lo and behold, roughly a third of the 2.9 percent GDP growth was from exports (1.17 percent), ('Consumers Save the Economy,' Wall Street Journal, 10/29-30/16). The Journal had additional thoughts. Remember, the term is 'trade.'

"'We think imports -- which consumers buy and companies use to build finished goods -- are as valuable to the economy as finished goods.' That addresses those who oppose trade because they want to export but ban imports. Data shows large portions of all imports from many countries are raw materials and subassemblies our companies need to manufacture things. 'For this quarter, at least, the protectionists have lost a talking point,' the Journal concluded.

"That dovetails with data from a couple years ago when the only GDP growth the U.S. had was from exports.

"Ambassador Darci Vetter, the USTR's chief ag negotiator, has been out front pushing TPP. Republican leaders, such as House Speaker Paul Ryan, can expect strong support from the struggling dairy sector if they agree to hold a vote on the TPP after the election, Vetter said. That could be critical, since Ryan's home state of Wisconsin is the second-largest U.S. dairy-producing state behind California.

"'I think dairy, frankly, is out there in full force," Vetter told Pro Trade's Doug Palmer after a discussion on TPP and related issues at George Washington University on November 1. "It kind of took them a while to get there, but they've become one of the more enthusiastic groups out there supporting TPP.'

"TPP was hard for the dairy sector to accept at first because it would open the U.S. market to more imports from New Zealand, a major competitor. But it also opens Canada, Japan and other TPP markets to more U.S. dairy exports.

for the U.S.
because none of them really have active dairy sectors and dairy demand is growing exponentially," Vetter said. "So getting that first agreement was really hard, but the potential they see after is really big,' (Politico's Morning Ag, 11/02/16).

"Vetter also spoke at the Wall Street Journal's Global Food Forum.

"'I think TPP really provides an opportunity for U.S. agriculture to access some very high-income, high-value markets, but also to get a foothold into emerging economies in Southeast Asia through Vietnam and Malaysia," Vetter said in an interview. "Vietnam and Malaysia right now buy our feed grains, skim-milk powder and basic commodities. But as their populations grow and more people enter the middle class, we see a huge opportunity to send them more protein, fresh fruits and vegetables.

"'...when you look around the world, the most protected markets, the highest tariffs, the most difficult barriers are often in that agriculture sector. If you look at both Canada and Japan, which have some very closed markets, for the first time in a free-trade agreement every product without exclusion was on the table and was liberalized in some way. Never before in a free-trade agreement had Japan opened its sectors for beef, pork, wheat, rice, dairy or sugar. All of those products are on the table in TPP, with significant new access. In our previous trade agreements with Canada, they didn't offer any access to dairy or poultry or eggs. We will have access in all three sectors if TPP is entered into force,' ('How U.S. Farmers Would Gain From the Trans-Pacific Trade Partnership,' 10/16/16).

"So what is the opposition to TPP? Much of it is simply misdirection, to persuade folks to look the other way from certain interests. Labor unions want to protect the status quo and value their jobs more than they do the best interests of American consumers. They are not concerned with Americans getting the best selection and the best prices. They just want American companies to keep making the same goods in the same factories to keep the same jobs for decades. Insisting on U.S. labor law in other countries' domestic regulations is just obstructionism. Environmental groups oppose trade because they oppose manufacturing, mining, forestry harvest and management and energy development here. They are arrogant enough to try to block it in other countries.

"Congress reconvenes in mid-November. Contact your members now about TPP."



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