Urging farm support for TPP
CLIVE – A United States government official brought a sense of urgency to Iowa July 14 concerning the Trans-Pacific Partnership, outlining the importance of its passage to U.S. ag exports.
Michael Froman, U.S. trade representative, spoke to 11 Iowa commodity organization leaders, host by the Iowa Pork Producers Association in Clive.
TPP is a trade agreement among twelve Pacific Rim countries – the U.S., Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile and Peru.
The pact aims to deepen economic ties between these nations, slashing tariffs and fostering trade to boost growth.
The finalized proposal was signed on Feb. 4 in Auckland, New Zealand, concluding seven years of negotiations. It is currently awaiting ratification to enter into force.
Froman was sworn in as the 17th United States trade representative on June 21, 2013.
As USTR, he is President Barack Obama’s principal advisor, negotiator and spokesperson on international trade and investment issues.
“There is a lot at stake,” Froman told ag leaders. “We can’t afford to put this off.”
“The ag sector is the key to lobbying for ratification.”
Froman listed what’s at stake if the U.S. Congress fails, or even delays, TPP ratification.
- Even a one-year delay could cost the U.S. an estimated $94 billion.
- The other 11 countries want U.S. involvement, seeing the U.S. as a critical partner.
- China has free trade agreements with 16 countries. “If passage does not happen,” Froman said, “we’ll hand the keys (as trade leader) to China.”
- If TPP does not go forward, Froman said, other countries are already active. “The U.S. will lose significant (export) market share.” In fact, since Feb. 4, he said 13 additional countries have applied for TPP inclusion. “The rest of the world is not standing still.”
- TPP gives trade access to markets that are harder to get into alone. With TPP, Froman said, “Many trade barriers go away.”
The U.S. is the only TPP country that has to push for ratification, Froman said.
However, Froman believes the majority of lawmakers understand how important passage of TPP is, but they are wondering how it will all play out in the long run.
Although there will be no ratification vote until after the November elections, Froman thinks currently there are enough votes for passage.
Nevertheless, Froman said even though commodity groups are lobbying hard for passage, lawmakers will tend to respond better when they hear from producers.
David Struthers, immediate past president of the Iowa Pork Producers Association, called TPP a “win-win” for the U.S. and its partners.
“The U.S. has good protein the rest of the world needs,” Struthers said.
Because trade puts more people to work on both sides of the equation, he said, demand grows for each other’s products.
“This will build each other up.”
When asked about farmers who are critical of TPP and claim trade agreements result in lower commodity prices, Pat McGonegle, chief executive officer for IPPA, acknowledged that does happen.
As demand goes up, he said, production slows and the price drops.
“But imagine if we had no exports,” he said. “We’d cut the (swine) breeding herd and who is going to decide who is going to raise hogs in the U.S?”
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