Transcript Of Remarks By Agriculture Secretary Mike Johanns With Under Secretary For Farm And Foreign Agricultural Services J.B. Penn At The Binational Mexico-U.S. Meeting - Mexico City, Mexico | USDA Newsroom
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News Transcript

Release No. 0166.05
Office of Communications (202)720-4623

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SECRETARY JOHANNS: "Well, let me just say good afternoon everyone, and thank you all for coming. I am very pleased to be visiting Mexico for the second time within a year, especially as Secretary of Agriculture. This is my first visit to Mexico as Secretary.

"We have accomplished a lot during this visit. I had a face-to-face meeting with my counterpart, Mexico Secretary of Agriculture, to ensure that Mexico and the United States build upon our already strong working relationship.

"I also met with the Secretary of Foreign Relations, signed an important initiative that will help us continue to expand our two countries' cooperation in the area of rural development.

"Mexico is a very important trading partner for the United States. It's a good market for American agriculture.

"Since NAFTA was implemented, U.S. agricultural exports to Mexico have more than doubled, reaching $8.5 billion in 2004. This year we are forecasting for Mexico to surpass Japan and become the second largest export market for U.S. agriculture.

"The United States is the number one market for Mexican agricultural exports, which have also more than doubled, reaching $7.3 billion in 2004. The U.S., Mexico and Canadian agricultural trading relationship under NAFTA serves as an outstanding example of how trade liberalization does work.

"That is precisely why I've spent so much time talking about the need for the United States Congress to ratify the CAFTA-DR trade agreement. Like NAFTA, CAFTA-DR provides for a leveling of the playing field so that the United States can compete in the important markets of Central America and the Dominican Republic.

"Here in Mexico we see the importance of free trade as an economic catalyst to help a country grow and develop. Even with trade, we sometimes experience challenges, often in the form of animal and plant health disease requirements, sometimes with calls for protection from affected industries. And this requires a very good working relationship at all levels of the government starting at the top.

"As you know, when President Bush took office he made Mexico his first foreign visit. The President understands the importance of the relationship between our two nations.

"I am here today to follow his leadership and provide similar leadership in the Department of Agriculture. As you will remember, in March of this year Presidents Bush and Fox met with Canadian counterpart Prime Minister Martin in Waco, Texas, to launch the Security and Prosperity Partnership of North America.

"The goal of this partnership is to enhance the competitive position of North American industries in the global marketplace and to provide greater economic opportunity for all of our societies while maintaining the highest standards of health and safety for our people.

"This week Secretary Usabiaga and I reaffirmed our commitment to work together and with Minister Mitchell our counterpart in Canada to make North American agriculture an even more competitive and prosperous sector.

"Our departments will work together in both the long and in the short term to foster more harmonized rules and regulations to better ease the flow of agricultural goods in North America while always protecting the public health.

"We also discussed our commitment to the goal of rural development in North America and how we will work together under the Partnership for Prosperity Initiative to make even more progress in this important area.

"At USDA we administer 43 rural development programs designed to assist rural residents and communities increase their economic opportunities and improve their quality of life. Access to under-served communities in need including the Hispanic community has been a longstanding objective of the Bush Administration.

"Given that many Mexican-Americans and Mexican nationals working within the U.S. in migrant communities situated in border and rural areas throughout the U.S. may be unaware of the USDA Rural Development programs, today I signed a Rural Development Partnership Initiative to utilize the network of Mexican consulates throughout the United States to complement the USDA's Rural Development state and county offices.

"This partnership will enhance the opportunity to cooperate on projects, to address barriers, and increase access to rural development programs for improving the economic well-being of rural residents.

"When I served as governor of Nebraska I worked closely with the Mexican consulate in the state. I know firsthand about the good work of these consulates, and I know that it makes sense for USDA to work with them to improve our outreach efforts to the Hispanic community in the United States.

"In closing, I had two excellent meetings this morning with Secretaries Usabiaga and Derbez, and I come out of them confident that we will work very closely together for the coming years to help build a stronger, more integrated agricultural economy in North America.

"We would now be delighted to take any questions that you might have."

REPORTER: "My name is Patrick Harrington. I'm with Bloomberg News. I just wanted to ask how you can get Mexico, or the United States government can get Mexico to drop its tax on imports of high fructose corn syrup and what the United States can give Mexico in turn, and how important solving that problem is to CAFTA."

SEC. JOHANNS: "Like so many issues, it's important-- to answer the last part of your question first. Here's the thought I would offer. In my meeting today with Secretary Usabiaga we recognized that in this rather massive amount of trade that we do between our two countries that there are going to be issues that pop up. We recognize that, he recognizes that. The good thing about our working relationship with Mexico is it's a relationship built on trust. It predates me by a lot. And there's a firm foundation of working together.

"Needless to say, we welcome the opportunity to negotiate on issues and work through issues. I don't want to talk about specifics of negotiations as you might expect, but I can offer generally that we trust him. We trust our working relationship with Mexican government, and we'll endeavor our best to do our best to work through the difficult issues that sometimes pop up with trade.

"Yes, sir."

REPORTER: "Tom Durham from [inaudible]. One of the things, to follow up on my colleague, are you saying [inaudible] is still negotiating the issue or is this already before international government? The other question is on the mad cow issue and consolidation of phytosanitary measures across Mexico, Canada and the United States before World Health authorities. How close are you on a common front there?"

SEC. JOHANNS: "On your first question, that is a WTO case as you know. We're expecting a decision soon. So I don't want to create the implication that we're somehow still negotiating. That is in the WTO process. Like I said, it shouldn't be too long before a decision is rendered in that area.

"In terms of the whole issue of BSE and working through the issues that has created, one of the things I expressed to the Secretary of Agriculture here is my appreciation because Mexico was really one of the first countries to reopen their borders to U.S. beef after we found that one cow in Washington state.

"In fact I think in Mexico, if I remember the statistics correctly, about 90 percent of the trade has been restored relative to beef-- if I have that number right.

"Here's what I would offer in terms of the harmonized standard. We're starting to take some steps in that direction. We all realize the value of that. With BSE the world has come to recognize that there is a way to deal with BSE very, very effectively. That's why you're seeing such a decrease in the number of BSE cases seen worldwide.

"The ruminant-to-ruminant feed ban, the removal of the specified risk materials, the very things that the OIE calls for, the things that our countries have done, have made a huge difference. But that difference is occurring really across the world.

"We agree on one thing, and that is that our decisions need to be based on good science. And as long as we continue to speak that universal language, that international language of science, we can deal with these issues whether it's BSE or whatever.

"But again, in the BSE arena we're doing everything we can on our side of the border to normalize beef trade with the world. And we believe that here in North America we can be leaders in that effort, and again deliver a very sound message that: base the decision on science, there really isn't a risk to human health or to animal health."

REPORTER: "Is there the effort to harmonize from an official front?"

SEC. JOHANNS: "Those discussions, we signed kind of a letter of intent I guess is the best way of describing it-- where we're working in that area together. Those things don't happen overnight, but we have a commitment, and there's a commitment here, and I think it's very safe to say there's a commitment in Canada to work toward that end."

REPORTER: "Mia Olring (sp) from Dow Jones. Mr. Secretary, I'm sorry to press with you now. I know [inaudible], but it is a very important issue, the whole issue of fructose and superquotas of the supposedly [inaudible] ongoing negotiations. So I have to press you to see if we can get some kind of answer.

"This case has been going on for almost eight years now. There have been a lot of promises during these eight years that some deal was closed, and it was not closed, there wasn't an answer, and there was nothing about disputes coming up in between that on this bill negotiation at the official level.

"And in the case of just figures this week from Mexico showing that we have a new record sugar harvest, there will be a significant surplus from Mexico this year. So is the U.S. ready to consider giving any significant quota to Mexico in this coming 2005-2006 fiscal year?"

SEC. JOHANNS: "For what product was that?"

REPORTER: "Sugar."

SEC. JOHANNS "Sugar. Okay."

SEC. JOHANNS: "Again, I don't want to imply that I sat down with the secretary today to negotiate the fructose issue. We did not. There is a WTO case. Again we expect a ruling from the WTO very soon in terms of that case. So I don't want anybody to walk out of here thinking that we were sitting there negotiating it. That was not the case at all.

"In terms of the sugar issue, maybe I'll ask JB if you want to offer a thought on that?"

SEC. J.B. PENN: "I would just add to what Secretary Johanns said the following. You indicated this has been a longstanding issue, and that's certainly true. There have been attempts to have official negotiations within the past five years. But the more recent negotiations have been industry-to-industry. And I think you should talk to leaders of the Mexican industry and the U.S. sugar industry as to where those discussions might stand.

REPORTER: "But -- sorry. But in [inaudible] combined really the two, superquotas -- this year there is a surplus production in Mexico. Mexico according to NAFTA does have the right to [inaudible] all the surplus production to the U.S. So in this particular light, regardless of the WTO case will the U.S. not make any whatsoever steps forward to Mexico to [inaudible] this new situation?"

SEC. PENN: "Well, we claim that the high fructose tax is illegal, is not sanctioned by the WTO. We'll get a ruling on that fairly soon as I said, so let's see how that comes out and then we'll see how we go forward.

"As you know, there's been a lot of disagreement about the so-called side letters about what constitutes surplus sugar, how you define surplus sugar. There are many, many issues yet to be dealt with. But the first one is the ruling from the WTO; let's see how that goes, and then we'll look forward."

REPORTER: "You will not consider any quota whatsoever until the WTO --"

SEC. JOHANNS: "We need to see what the WTO case says, and then we'll look forward from there."

REPORTER: (in Spanish)

SEC. JOHANNS: "In reference to your last question, Partnership for Security, the USDA is fully engaged in that process. We literally have a work plan. Part of what we did today in terms of our outreach effort here in Mexico is to make sure that both secretaries understand we're absolutely committed to that at the USDA. And we're going to do everything we can to advance that. It's important to the leaders of our countries.

"And so my emphasis today is that we're fully engaged, we'll do everything we can to make that a very, very meaningful initiative on the USDA's part.

"In terms of additional opportunities for trade, again if you look at the history over the last decade the numbers are very, very remarkable when you look at agricultural trade between the two countries. Trade on this side of the border has doubled. Trade in the United States has doubled. I mean, it's been truly, truly remarkable.

"I indicated to Secretary Usabiaga that to us that's positive. I firmly believe that trade is a two-way street.

"My expectation is they will continue to see growth again on both sides of the border. What specific products? We could probably provide list after list of products that have been benefited. I know we can.

"And our attitude always is that we should encourage this kind of trade, this kind of economic growth, and we'll continue to do that.

"And again, without being product-specific, you can just look at the overall numbers. And they've been very remarkable. They've been very positive on both sides, tremendous growth in the last 10 years or so since NAFTA came into existence."

REPORTER: (Question in Spanish on immigration policy)

SEC. JOHANNS: "Could I get a repeat of the translation on the first part of that?

"Let me just say, when it comes to immigration the President has indicated on a number of occasions that in his second term he would like to address comprehensive immigration reform. And he has indicated that that is a priority for his second term.

"So again, I have that experience that I can tell you because I've worked with the people. So I do believe that there are opportunities for economic advantage really again on both sides of the border. It's a complicated issue, as you know, because you involve issues relative to security, and those are never easy to solve in a post-911 world. But the President has indicated it's a priority. And so we'll do everything we can to support that initiative."

REPORTER: (Question in Spanish)

SEC. JOHANNS: "I hope you understand, I was not at the Monterrey meeting, so it's a little difficult for me to comment on what the thoughts were that were expressed there. Again, I will assert something that you probably know already, and that is the President has indicated that immigration reform is a priority for his second term. And we'll do everything we can to support him in that important initiative."

REPORTER: (Question in Spanish)

SEC. JOHANNS: "The point in regard to exports, again I'm going to kind of defer on the questions relating to the Monterrey meeting just simply because I wasn't there. And I hope you understand that commenting about a meeting I did not attend and haven't reviewed any of the materials relative to that meeting, I just hesitate to offer a thought."

REPORTER: (Question in Spanish)

SEC. JOHANNS: "Mexico is very competitive. When it comes to agriculture, I believe Mexico is very competitive, very competitive on a world-wide scale. Far and away we are the largest trading partner with Mexico, and Mexico is not very far away from being the second largest trading partner for the United States.

"So again, there's been a tremendous amount of mutual benefit. There are many things that Mexico does that producers here in this country can be very proud of-- many very high quality products that are produced that are enjoyed by our consumers.

"Probably the best way I can answer that question is, you can look through the list of products that are exported from Mexico to the U.S, see their growth, and it answers your question. It identifies really that Mexican producers can compete, and they do. And they've seen a doubling of their exports under the NAFTA agreement. It's been rather a remarkable growth.

"Anytime you can double your exports into a given market, that's a pretty significant statement. You're doing a lot of things right."

REPORTER: (Question in Spanish)

SEC. JOHANNS: "Interruptions to trade in the beef industry have caused a significant trade disruption if you will. And that's obvious because immediately after December 23 of 2003 a very large part of the international market closed.

"Now we have been systematically reopening that, and so a pretty high percentage of that has been recaptured. We're closing in on the last piece of that, so we're getting back on more normal trade relations.

"The difficulty that has been created in terms of trade with Canada is that processing in the United States--very small processors to the very large--have really been hit hard by this. We've had lay-offs, we've had people lose their jobs. We've had some very serious consequences.

"And it's not good for the industry. It's not good for the beef producer, whether you're a small producer or even a large producer. And so we are working very hard to get that trade normalized.

"In terms of the harmonization, again we believe that that approach makes a lot of sense. The OIE has been very helpful here. They do establish standards that are based upon good scientific information. And so they offer us guidelines that we can follow.

"My hope is that these discussions toward a more harmonized approach will continue because I just believe it makes sense. We all agree on one thing-- we want to be able to produce a very high quality product that is safe for the consumer. And we do that. And then we want to make sure that our processes are in place to continue to ensure that not just today but over time.

"And I know the Secretary here shares that view, and I know the Secretary in Canada shares that view. So the closer we come to following the same approaches that are based upon science that ensure safety to humans and to animals the better off our industries will be.

"One more question I think and then we have to go to the airport. Why don't we go here?"

REPORTER: (Question in Spanish.)

SEC. JOHANNS: "We have many people of Hispanic background that work in agriculture. And I'm sorry I would not be able to quantify that. Somebody might have figures for you. But I don't have the ability to give you a percentage as to what percentage may have come from Mexico or other parts of the world for that matter.

"I can offer this. On the legislation that you referenced that Senator McCain and Senator Kennedy introduced, we have not reviewed that legislation. I did read about it in the newspaper this morning. So again, I would hesitate to offer a comment on legislation that we've not had an opportunity to take a look at and offer our viewpoint on. But I do know the legislation was introduced -- just simply because I read the newspaper article.

"Okay. One more question just because you're so nice."

REPORTER: "I want to go back to beef imports, a related question on that. Do you expect or when do you expect or how soon do you expect that trade will be restored 100 percent? We are back to 90 percent of beef imports from the U.S., Mexico. How much longer? And in that same relation, is there any development on the beef exports to Japan? There was supposed to be a mission just a couple days ago? Any progress with that?"

SEC. JOHANNS: "Our discussions with Japan have gone well. We feel that the steps that they have made, although slow, have been positive and in the right direction. And that's been the case now for many months. And I find that encouraging.

"I would be a very, very popular person back in Washington if I could give you the exact date for the resumption of trade with Japan. But we're going to do everything we can to continue to push forward just simply because we feel very, very strongly that there is no risk. There really is no risk.

"And so we'll do everything we can to move that to a successful resolution. We're very anxious to start selling American beef in Japan. And I believe the consumers are ready for us to return to the marketplace. And again I emphasize, there's just no food safety risk there.

"The other thing I would offer in terms of Mexico, there are some things that, I think there's about 10 percent left. Like I said, Mexico really showed leadership. When we will finalize that, I don't know if I could even offer a date on that."

SEC. PENN: "No. We have 91 percent now. It's mostly live cattle and a few other products. And we need to see how the court case with Canada works out."

SEC. JOHANNS: "We have about 91 percent of that market reclaimed. The remaining piece is mostly live cattle, and that kind of gets tangled up in the lawsuit that is going on that we have with Canada.

"And so we're going to do everything we can to work through that, and we believe we will get a successful resolution of that case. But there is a process we have to go through. And so we're working through that process, and we're optimistic about the end result. But we still have to go through the process."

REPORTER: "Do you have any indications of Japan? Could that restart this year?"

SEC. JOHANNS: "I hope it restarts tomorrow. Every time I sit down with the media in the United States they say, Mike, when's the date? And I, honestly I wish I could give you a date. But we are making progress. I'm very confident that we're headed in the right direction.

"Thank you, everyone."