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The U.S.-Panama Trade Promotion Agreement eliminates tariffs and other
barriers on most U.S. goods, increasing export opportunities for agricultural
products important to Colorado. With immediate elimination of duties on over 60
percent of current U.S. trade, this agreement changes the one-way street of
duty-free access currently enjoyed by most Panamanian exports into a two-way
street benefiting both countries. The American Farm Bureau strongly supports the
agreement, predicting widespread gains for U.S. agriculture exceeding $190
million per year.
Colorado’s exports to all countries, estimated at $1.1 billion in 2007,
supported about 11,720 jobs, on and off the farm. These export sales make an
important contribution to the Colorado farm economy which had total cash
receipts of $6.2 billion in 2007.
Beef. Colorado’s cattle and calf industry leads all other state
agricultural industries with more than $3.2 billion in cash receipts in 2007, or
50 percent of the state’s agricultural sector total. The state’s exports of
cattle hides and skins, live animals and meat were estimated at $326 million
in 2007. Colorado ranchers will gain from this agreement.
Panama will immediately eliminate its 30-percent duty on beef products
of most importance to the U.S. beef industry--prime and choice cuts.
Panama’s tariffs on other cuts of beef will be phased out over 15 years.
The 10-percent tariff on beef tongues and livers will be eliminated in 5
years, and the 15-percent tariffs on other edible offal will be eliminated
immediately.
Panama has already implemented our December 2006 bilateral agreement on
sanitary and phytosanitary (SPS) measures, reopening its market to U.S. beef
by bringing its import requirements related to BSE into compliance with
international standards.
Panama also accepted the equivalence of the U.S. meat inspection system,
which allows U.S. inspectors to certify beef for export to Panama without
having each facility and shipment inspected by Panamanian authorities.
Dairy Products. Colorado dairy producers are the state’s second largest
source of farm cash receipts at $515 million in 2007. Under the Panama
agreement, they will benefit.
U.S. exporters will have immediate duty-free access to nine preferential
dairy tariff-rate quotas (TRQs) with a combined total of 3,986 tons. These
include 2,625 tons of skim milk powder, 728 tons of cheese, 263 tons of ice
cream, and 370 tons of other dairy products. These quantities will grow by 4
or 5 percent each year and the over-quota tariffs for these TRQs, which
range from 15 percent for ice cream to 50 percent for milk powders, will be
phased out in 15 to 17 years.
U.S. dairy exporters will continue to have access to the global TRQs for
3,830 tons of milk powder and 3,782 tons of cheese that are part of Panama’s
World Trade Organization commitments.
Panama will eliminate its 30-percent tariff on dried whey products
immediately. The tariffs on most other dairy products, which currently face
duties as high as 140 percent, will be phased out over 15 years.
In addition, Panama has already implemented our December 2006 bilateral
agreement on SPS measures and technical standards by recognizing the
equivalence of the U.S. food safety systems for processed foods, including
dairy products, and by streamlining its product registration system for
packaged foods. This will allow U.S. food processors to export dairy
products to Panama without burdensome paper work and without having each
facility and shipment inspected by Panamanian authorities.
The National Milk Producers Association supports the Agreement, noting
that "Panama imports nearly half its dairy products, and the U.S. stands to
become a larger supplier once the FTA is finalized."
Wheat. Colorado’s wheat exports were $337 million in 2007. Wheat growers
will benefit from this agreement.
Panama’s current zero-tariff treatment for wheat will be locked in place
immediately upon implementation of the Agreement.
The 10-percent tariff on wheat flour will be eliminated within 12 years.
Back to the
U.S.–Panama Trade
Promotion Agreement
