A formal statement was submitted today to the House Ways and Means Committee on behalf of AFI expressing the association’s strong support for swift approval and implementation of the Peru Free Trade Agreement (formerly known as the Peru Trade Promotion Agreement, or TPA). A copy of the statement is available to any Member upon their request to Bob Bauer or Jeff Levin (jsl@saslaw.com).
The statement notes in conclusion as follows:
The Peru TPA does not provide any new benefits for imports of products of interest to AFI and its member-companies; it merely preserves the situation that has been in place for nearly 15 years. This situation has well-served a wide range of economic interests here in the United States, as well as in Peru. However, retraction of duty-free treatment for imports of the product would have a discernible deleterious effect across-the-board. For these reasons, AFI strongly supports the actions of U.S. and Peruvian negotiators, and urges swift approval and implementation of this important agreement.
As Members are aware, the Andean Trade Preference Act (ATPA) is currently scheduled to expire as of January 1, 2007. If the ATPA indeed expires as of that date, and the Peru TPA is not approved and implemented by that time, imports from Peru that currently enjoy duty-free treatment would again be subject to the “normal trade relations” (NTR) tariff rate. In the case of processed asparagus and artichokes, for example, the NTR rate is 14.9 percent. (These products are not eligible for duty-free treatment under the GSP; in any case, the GSP is also scheduled to expire as of January 1, 2007.)
At this time, it remains very unclear when the House of Representatives and Senate will vote on the implementing legislation for the Peru TPA. It is possible that Congress may act prior to its August recess (which will begin in less than two weeks; the House Ways and Means Committee has scheduled a “mock” mark-up of the implementing legislation for this Thursday, which indicates that some movement is afoot); it is possible that Congress may act after it returns from its August recess, but prior to its recess for the mid-term elections (possible but not likely since many members of Congress would be extremely reluctant to cast a “trade” vote prior to the elections in November); and it is possible that Congress will act after the elections during a “lame-duck” session (which would remove some of the political pressures, but would leave very, very little time for implementation as of January 1, 2007).
An extension or renewal of the ATPA is also possible, but no legislation currently exists in Congress for these purposes, and the general feedback from the Executive and Legislative branches appears to be that this issue has been put on the back-burner for now so as to maintain negotiating pressure on developing countries while the Doha Round still has some last breaths in store.
And, of course, any one of a number of issues prevalent in the headlines these days could reach such a tipping point as to sap the energy and reservoir of political will to the detriment of such “arcane” matters as trade agreements.
In any case, we will continue to monitor events on a daily basis, we will continue to work with our contacts in Congress and with like-minded associations in order to press for speedy approval and implementation of the Peru TPA (and extension of the ATPA, should that prove necessary), and we will continue to keep Members closely advised. To this end, we will be issuing a draft “political action” letter for Members to send to their Senators and Representatives within the next few days.
As this Association has proved instrumental in moving several trade issues over the past months and years, we will once again remain at the forefront here.
