In a ceremony this morning at the Old Executive Office Building, President Bush signed into law the Tax Relief and Health Care Act of 2006, which includes a number of trade provisions including the extension of the Andean Trade Preferences Act and the Generalized System of Preferences (as well as miscellaneous tariff provisions and permanent “most favored nation” treatment for Vietnam). This morning’s action finalizes a successful fight for extension of these trade preference programs in which AFI played an integral role. Our congratulations again go out to the Association, its membership and its leadership for their invaluable participation in this fight.
In an unrelated development, the United States and Panama announced yesterday that they have concluded negotiations on a bilateral free trade agreement. Panama now becomes the seventh Central American nation to complete FTA negotiations with the U.S. (after the “CAFTA 6,” Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua). The agreement will be considered under current “trade promotion authority” procedures (meaning, subject to a “yes” or “no” vote by Congress, without an opportunity for amendment) so long as it is signed prior to July 1, 2007 (assuming that TPA is not extended, which is doubtful in light of the Democratic victories in the November elections).
Negotiations with Panama commenced in April 2004, and proceeded in fits and starts since that time. If implemented, the agreement would make permanent trade preferences already extended to products from Panama under the Caribbean Basin Initiative, while providing U.S. exporters the opportunity to participate in the $5.25 billion expansion plan for the Panama Canal, which is due to begin in 2008.
We will continue to keep Members advised.
**Note: Included in the trade bill was the miscellaneous tariff bill. Those provisions included the extension of the duty reductions on processed artichokes and new reductions on oysters, as outlined in our previous notices. Those changes go into effect in 15 days. It’s important to note that processed artichokes entered between Jan. 1 and Jan. 5 will be subject to the original, higher duties because the reductions lapse from Jan. 1 through the end of the 15-day waiting period.
