The elimination of trade barriers and subsidies is a necessity if U.S. agriculture is to remain competitive in the global economy. This is most often accomplished through preferential or regional trade agreements.
The United States is a part of only two of the more than 130 preferential trade agreements that are currently in force throughout the world.
Trade Promotion Authority (TPA) would strengthen the ability of the United States to negotiate positive regional trade agreements. President George W. Bush and Agriculture Secretary Ann Veneman agree that without TPA the U.S. will lose many new market opportunities.
“One of the most important tools we have in the struggle to remain competitive is Trade Promotion Authority,” said Ann Veneman, Secretary of Agriculture.
Trade Promotion Authority allows the Administration to negotiate trade agreements and then present them to Congress for an up-or-down vote. In the absence of TPA, other countries are refusing to negotiate final agreements with the U.S. because they would be subject to further change.
The U.S. Department of Agriculture (USDA) said exports account for more than 25 percent of farm income, which makes it one of the most export-dependent sectors of the economy. U.S. producers and processors ship a billion dollars in food and farm products to foreign customers on average each week.
“The long-term prosperity of the U.S. food and agriculture sector depends on our ability to stay ahead of the competition in the global economy,” Veneman said. “With TPA we can enter into agreements to eliminate trade barriers and roll back trade-distorting subsidies.”
American Soybean Association (ASA) Chairman Tony Anderson, a soybean grower from Mt. Sterling, Ohio, met with President George W. Bush in June to talk about the support of soybean producers for TPA.
Agriculture makes one of the largest contributions to the U.S. trade balance, and soybeans are the largest farm export. Exports of soybeans, soybean meal, and soybean oil totaled more than $7 billion last year. U.S. soybean farmers are dependent on export demand for half of each year's crop. With production increasing, TPA would increase access to foreign markets and help raise soybean prices — which are currently at 27-year lows.
“World economic growth and increased soy export opportunities brought about by reduced trade barriers is important to soybean farmers. With 96 percent of the world's population living outside our borders, growth in export demand must be part of our long term strategy,” Anderson said. “TPA is essential if U.S. soybean farmers are going to remain competitive in the world market. Otherwise, we will be left behind as global trade continues to expand.”
Trade Promotion Authority is key to creating new market opportunities for U.S. food and agriculture products in global markets.
“The U.S. must no longer hamstring its own negotiating power,” Anderson said. “Other oilseed exporting countries are actively negotiating trade agreements with many of our key customers. The European Union, Canada, Brazil and Argentina do not allow amendment of these agreements by their legislatures, and we need to operate on the same basis.”
TPA will provide President Bush with a tool that is essential to helping the farm economy grow by making it possible for U.S. producers to compete in an always changing global market.
“We need Trade Promotion Authority,” Veneman said. “It is absolutely critical to empower our negotiators at the bargaining table and to provide our trading partners with the assurance they need that we will back up our commitments.”
“TPA would still give Congress and the public the opportunity to help shape U.S. policy before our officials are sent to the negotiating table,” Anderson said. “This authority would strengthen the U.S. voice at key upcoming negotiations, including the World Trade Organization Ministerial meeting in November.”
Trade Promotion Authority legislation has been introduced in the Senate by Senators Bob Graham (D-FL) and Frank Murkowski (R-AK). In the House of Representatives, a TPA bill was introduced by Representative Philip Crane (R-IL).
The American Soybean Association is a national commodity organization with 28,500 members and affiliation with 29 states. For membership details, call 1-800-688-7692.