MODERATOR: Good afternoon from Washington. I'm Larry Quinn speaking to you from the Broadcast Center at the U.S. Department of Agriculture. Welcome to today's news conference with Secretary of Agriculture Ed Schafer. The topic for today's conference is the President's action regarding the Colombia Free Trade Agreement.
Reporters, if you wish to ask a question, please let us know that by pressing *1 on your telephone touchpad.
Now it's my pleasure to introduce Secretary of Agriculture Ed Schafer.
SEC. SCHAFER: Thank you, Larry. I'm pleased to be here to talk a little bit about the Colombia Free Trade Agreement. Yesterday the President sent the implementing legislation for the Colombia Free Trade Agreement to Congress for consideration. Before I get into the policy of this agreement, let me say a word about the process.
The FTA was negotiated 16 months ago, and since that time the Administration has reached out repeatedly to Congress to find a bipartisan path forward. Yet Congress has not held a single hearing. Sending this legislation to Congress is a move to make progress on this important agreement. The President's Trade Promotional Authority requires congressional action on this within 90 legislative days.
As the President said yesterday, sending the implementing legislation to the Hill is neither the beginning nor the end of our cooperative efforts with Congress. Rather, it is an important milestone for this FTA. The Administration has held more than 400 consultations, meetings and calls with members of Congress and congressional leadership. I myself have reached out to members of Congress to discuss this agreement.
In response to congressional concerns, the Administration added enforceable labor and environmental standards to the agreement in May of last year. We have hosted trips to Colombia for almost 60 members of Congress to demonstrate the progress that country has made in reducing violence and strengthening democracy, and we remain committed to working with both parties toward approval of the Colombian agreement.
I hope to see the same bipartisan support on this legislation that we saw on the Peru agreement, and I hope we can see it soon. Our farmers and ranchers stand to gain a great deal from this agreement. Colombia is the largest market for our agriculture exports in South America, buying a record $1.2 billion of our agriculture products in 2007. What's interesting is that this market for our goods is growing despite the fact that all of our goods face duties and tariffs entering Colombia.
Meanwhile, the trade situation between our countries has become one-sided, as 99 percent of the Colombian food and agriculture products come into the U.S. without any duty whatsoever. The free trade agreement levels that playing field for our farmers and ranchers. It removes duties on more than 70 percent of our ag products immediately.
U.S. farm exports to Colombia that will receive immediate duty-free treatment on products including high quality beef, cotton, wheat and soybeans. Many specialty crops will also become duty free, including apples, pears, cherries and many processed food products like frozen French fries and cookies. The remaining tariff on our products will be eliminated over time.
We've also worked to address sanitary and phytosanitary issues with Colombia, and they have agreed to recognize the equivalence of our meat and poultry inspection systems and adopt full OIE standards. The American Farm Bureau put together some numbers on this, and they estimate that, once the agreement is fully implemented, American agriculture will see $690 million in gains each year.
The agriculture community recognizes the enormous potential of this agreement, which is why more than 40 agricultural and food associations have voiced their support for the Colombia FTA.
There are intangible gains with this agreement as well. Colombia is a key ally in our hemisphere, and this agreement helps strengthen our national security. There are concerns about violence in Colombia, but we believe, as does Colombia, that one of the best ways to help address them is through increased trade. It stimulates the economy and creates jobs, two crucial factors in stabilizing a society.
Colombia is already making progress on human rights. Since 2002 kidnappings and homicides and terrorist attacks have been decreased dramatically. They've also enjoyed record economic growth. The free trade agreement will help them continue these directions. It will level the playing field, create jobs, allow for fair competition, and capitalize on the strength of the parties involved.
And with that, I'd be glad to take any questions or comments that you might have.
MODERATOR: Reporters, as we prepare to receive your questions, we remind you to press *1 on your telephone touchpad to indicate that you'd like to ask a question. And, Operator, if you could give us the first question?
SEC. SCHAFER: Do we still have those technical difficulties?
MODERATOR: Operator, do you have any questions for us?
REPORTER: I'm trying to ask a question. Can anyone hear me?
MODERATOR: Yes. Go ahead.
REPORTER: I'm sorry. I'm unable to hear very much. Mr. Secretary, could you identify one or two specific products or particular crops, industries that are going to benefit the most from this agreement if it's approved?
And then the second question would be, can you describe the strategy for convincing the Democratic leadership that this can be done in what they're describing as a departure from the right procedure for approving a trade deal in Congress?
SEC. SCHAFER: Well, you know, to the second part first, you know, it's interesting to see who's defining the "right" procedure. In May of last year, an agreement was made with Speaker Pelosi about how to move forward with these trade agreements. At that time the agreement said that we wanted to see strong bipartisan support, we wanted to see the violence and labor issues be taken care of in Colombia, and there were a couple of other issues as well. The other one was the TAA agreement, the Trade Adjustment Authority, their adjustment as we go forward.
We are looking at now the statistics on the performance, the efforts in Colombia, and the violence and labor issues have dramatically changed. We showed the strong bipartisan support with the Peru Agreement, and the President is committed to a Trade Adjustment Assistance Program. So we are trying to say, okay, if all of those factors have been according to agreement, who's changing the direction here?
Unfortunately, through as I mentioned the 400 different contacts, consultations, meetings, phone calls that have taken place to try to get this through, the leadership has just been unwilling to act. And we all know that this is getting tied up in presidential politics as that unfolds.
The portion, the question you asked for strategy, from our standpoint in agriculture is this. We have over 40 agriculture organizations, trade associations, etcetera, that have said we must sign this agreement for the benefit of our members and for the good of the economy and the United States of America. We are going to ask those folks to continually contact their members of Congress. We are going to continue to point out the economic benefits of trade for agriculture, and we are going to ask members of Congress as I did this morning in my budget hearing to vote for agriculture to vote for their constituents to vote to improve our relationships between the two countries and support the free trade agreement.
So we've got a multifaceted effort here. The Administration will be contacting people to vote their hearts. And as long as the specifically Democratic Caucus don't take strong stances against this, if they allow their members to vote for what's right for America's pocketbook, then we think we'll get the votes from Congress.
MODERATOR: Operator, we're ready for the next question.
REPORTER: There was actually a second part to that question about the specific products or sectors that are going to benefit the most.
SEC. SCHAFER: Yes. We are looking at beef, pork, corn, wheat and barley products as well as cotton and some processed products like frozen French fries and cookies.
MODERATOR: Our next question, Operator?
OPERATOR: Our next question comes from Mr. Mike Hergert of Red River Farm Network.
REPORTER: Hello, Ed.
SEC. SCHAFER: Hi, Mike. How are you doing?
REPORTER: I'm doing great. I guess I probably have a couple questions, but one we heard Senator Grassley this morning on his conference call say that the problem right now is that protectionism is so strong in America that the argument for trade agreements is going on deaf ears. Would you agree with that?
SEC. SCHAFER: I do not agree with that. I think the protectionism is coming from the halls of Congress, people worried about politics and not putting free trade agreements. You know the reality is, certainly there are pockets of the economy in certain areas of the country that have been affected by our free trade agreements. But, Mike, as you know in North Dakota almost 50 percent of our agriculture products are exported. You know, the economy depends on agriculture; agriculture depends on exports. That is replicated in state after state after state across this country. And people know that.
I mentioned to an earlier group I spoke to that Americans are overweight. We eat a lot, but there's only so much we can do. You know, we've got to ship our agriculture products outside this country, and I do not believe that the protectionism comes from the American citizen. They want to see economic activity, they want to see job growth, and they want to see increased exports and increased economic opportunity in their communities. The hang-up we have right now is purely political. As you saw a strong bipartisan support in the Peru agreement, we should see a strong bipartisan support for Colombia as well. If we can get the proper votes, I think that's what will happen.
MODERATOR: We remind reporters, if you have a question to ask, please press *1 on your telephone touchpad so that we'll know you have a question. Operator, next question?
OPERATOR: There are no questions at this time. I apologize. We do have one question from Mr. Jim Berger of Washington Trade Daily.
REPORTER: Mr. Secretary, you said the hang-up right now is purely political on the Colombia Free Trade Agreement. Do you think the politics will sort of evaporate on this after the Pennsylvania primaries?
SEC. SCHAFER: You know, I don't know. The labor unions have taken a strong stance against this. And clearly you can show longshoremen have better jobs, truckers have better jobs, distribution managers have better jobs, better pay, better efforts because of trade. You know, they've taken a stance because labor has a strong stake in this by their protection to say, 'Let's close our borders and not have trade.'
One of the real issues here is today's trade. We do $1.4 billion or more than that in agriculture trade to Colombia today. Their products come in here duty-free. Ours get tariffed over there. That doesn't make sense. Upon signing this agreement, as I mentioned 70 percent go duty free of our products going down there. So really it's an effort of fairness, it's an effort of good economics, it's an effort of supporting an ally in a troubled South America, and we need very much to pass this.
So I just think the politics are at play. The reality is, after the Pennsylvania primary we're still going to have at least one Democrat candidate who has said, 'I want to renegotiate trade agreements, I don't want any new ones, I want to put a moratorium on it, whatever you want to talk about.' And that's just simply not good for America.
MODERATOR: Operator, we're ready for the next question.
OPERATOR: Our next question comes from Missy Ryan of Reuters.
REPORTER: Hi, again. Just very quickly, and excuse me if I missed this when I joined the call: are you going to be going to Colombia anytime soon to bring members of Congress to rally support for the agreement?
SEC. SCHAFER: My trip to Colombia, Missy, will be dependent on the Farm Bill. You know, the Farm Bill is absorbing us right now here at USDA. I had a trip scheduled a few weeks ago, and we delayed that trip because of the farm bill negotiations. But certainly I will be going to Colombia. We will be taking members of Congress. Ambassador Schwab has been taking people down regularly, and I think including just this last weekend Ambassador Schwab took a group down.
You know, we will continue that effort. We've had 60 members of Congress down there, and the changes are dramatic and striking as to what's going on, and we need to continue to support it. So yes, I'll be going to Colombia. We'll be taking folks down. But right now I'm on hold for the important Farm Bill negotiations.
MODERATOR: Operator, next question, please?
OPERATOR: Our next question comes from Mr. Mike Hergert of Red River Farm Network.
REPORTER: Hi, again. Ed, as I think Canada is negotiating or has negotiated FTA with Colombia. Where's that at, and is that a disadvantage for the U.S.?
SEC. SCHAFER: No, Mike. Is it snowing up there?
REPORTER: Oh, that's come and gone.
SEC. SCHAFER: (laughs) Okay. You know, I don't know about the Canadian negotiations with an FTA with Colombia. You know, it hasn't been involved in our work in what we're doing, so I just am not able to answer that question.
REPORTER: Thank you.
MODERATOR: Operator, do we have anymore questions?
OPERATOR: No, sir, not at this time.
SEC. SCHAFER: On this call, this is an important piece of legislation. I've outlined why it's important, but we really need to get this legislation passed. I would point out that Colombia is a pathway for free trade agreements. If we look at the Peru Agreement that was signed last December and you look at Colombia, add to that our very important negotiations with South Korea and Panama, those four countries together would provide $3 billion worth of agriculture, increased export opportunities. And so these agreements are important. Colombia is very important, but it is not the beginning nor the end. It is a pathway to get better bilateral trade agreements.
We're also negotiating hard on the Doha Round of the WTO; that's been a strong seven-year effort. It's gone up and down, but we see increased activity there and are optimistic on a multilateral basis at Doha as well.
We're putting this effort in because exports are hugely important to agriculture, they're hugely important to the United States, and 40 percent of our gross domestic product growth last year was generated by exports. And we need to put these agreements in place for the economy of the United States of America, for jobs, for careers to move forward, and we're going to do everything we can to do so.
So thank you very much for listening in, and we'll look forward to reading about your comments in the news.
MODERATOR: Secretary of Agriculture Ed Schafer.
I'm Larry Quinn bidding you a good afternoon from Washington.