Quick action needed on trade
Two bits of good trade news this past week should give farmers in the Northwest cause to cheer.
On March 3, President Barack Obama and Mexican President Felipe Calderon announced a plan that could end a nearly two-year cross-border trucking dispute that led the Mexican government to impose crushing tariffs on dozens of U.S. farm products.
The 1994 North American Free Trade Agreement allowed truckers from each country to engage in cross-border operations. Trucking companies and driver unions in the U.S. raised issues about the safety of Mexican trucks and drivers, so that provision was never implemented on the U.S. side of the border.
The Bush administration established a pilot program that would have allowed some Mexican trucks that met certain standards to enter the country to deliver their loads. The program failed to satisfy opponents, and was defunded by Congress in 2009. That led Mexico to impose punitive tariffs on a host of U.S. products. Those tariffs hit West Coast farm products particularly hard, making American apples, strawberries, potatoes, Christmas trees and a host of other crops more expensive in Mexico.
Under the new agreement, Mexican trucks and drivers would be allowed in the country if they meet stringent environmental and safety standards. Mexico will begin lifting the punitive tariffs in phases, eliminating them entirely when the first trucks are certified.
The details of the agreement still need to be hashed out, but it seems to be a win-win for everyone. U.S. taxpayers will have some assurance that Mexican trucks on our highways are safe. Mexican trucking interests will have the access guaranteed under U.S. treaty obligations. And Western farmers will be able to sell more of their crops south of the border.
Late last week, Agriculture Secretary Tom Vilsack announced that U.S. farm exports are expected to reach a record $135.5 billion in fiscal year 2011, a 25 percent increase in value over last year. Americans are net importers of foreign goods. The rare exception is agriculture, where U.S. farmers enjoy a trade surplus that Vilsack said could reach $47.5 billion.
Foreign markets represent huge opportunities for American farmers. As developing nations increase their standards of living, consumers in those countries demand the foods grown in abundance here.
The administration has also announced that it wants Congress to give quick approval for a trade agreement with South Korea that could double U.S. exports to that country to $10 billion. Still pending are deals with Panama and Colombia negotiated by the Bush administration. All of these agreements have benefits for U.S. farmers.
The flow of U.S. farm products to other countries depends in large part to workable pacts to reduce barriers to free trade. We urge quick action on these pending agreements.