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U.S. Wheat Associates looks at domestic, foreign policyBy Jennifer M. Latzke
It's been 50 years since U.S. Wheat Associates' predecessor Great Plains Wheat opened the first foreign office to promote U.S. wheat in Rotterdam. Today, USW maintains 18 offices overseas and monitors and formulates policy to promote U.S. wheat exports around the world. As part of its winter board meeting, USW hosted a Policy Symposium Feb. 4 in Washington, D.C., to look at trade policies that affect U.S. growers 50 years after the first export promotion steps. Lead speaker for the afternoon was U.S. Secretary of Commerce Carlos Gutierrez, who emphasized the Bush administration's stance on opening world markets and supporting free trade agreements. He also applauded USW for its efforts in promoting wheat to world markets. "You've shown other industries how to export and grow economies and build new markets," Gutierrez said. "U.S. agriculture and the wheat industry have shown everyone how to export and build global business opportunities. Increased opportunity for agriculture is critical to the U.S. economy, so don't step back from fighting for free and fair trade." On the table before Congress are pending free trade agreements (FTA) with Colombia, Panama and Korea. And while the United States has faced criticism for its many FTAs, Gutierrez noted that compared to our 14 FTAs, the European Union's 23 FTAs show that practically every other country is working to open up trade. "The world is opening up its economies and we're debating whether to do so or not," Gutierrez said. In 2006 agricultural exports from the United States reached $71 billion, and we are the world's top wheat exporter, he added. "We have a golden opportunity to grow business by lowering barriers," Gutierrez added. The Peru FTA has passed through the House and the Senate and should be implemented shortly, but it's one of four agreements. "Combined, these agreements offer a new market of 100 million people and trillions of dollars of GDP," Gutierrez said. "We have to be able to keep up with our competitors." In Korea, for example, the United States' market share five years ago was 100 percent. In 2007, it dropped to 35 percent. In Colombia, U.S. wheat market share dropped from over 60 percent to 40 percent in 2007. "Canada is negotiating a free trade agreement with Colombia and if we don't get in there they'll buy from Canada," Gutierrez said. "We've already negotiated the deal and there's no sign of Congress moving toward a vote." Current trade with Korea, Panama and Colombia faces challenges without FTAs. In Panama, there are tariffs on wheat as high as 90 percent or greater, Gutierrez said. In Colombia, U.S. agricultural exports face duties but 90 percent of their exports to the U.S. are duty free, he added. The Colombian FTA is facing the most controversy because of the violence targeted toward its unions. Congressional leaders are wary of signing an agreement to promote trade until the violence is contained. "There is no argument that there is no violence," Gutierrez said. He added that the United States has historically worked to help Colombia combat violence and drug trafficking. Nearly $5.5 billion has been sent from the United States into Colombia and targeted to drug eradication and social and educational programs. And, signs point that the investment is working. "Why put $5.5 billion into a country and then have second thoughts on an FTA with that country?" Gutierrez asked. Gutierrez, who immigrated to the United States as a child with his family from Cuba, answered an audience question about opening up trade with the island nation. "It's a complex subject," he said. "I agree with the President's policy on continuing the embargo on Cuba until it makes changes. The question is, when will there be change in Cuba? In spite of the embargo, we provide about one-third of the food and medication in Cuba." He added that it's been 49 years of attributing the country's shortcomings to the U.S. and that things should change when leadership changes. "It's one man's policy and we have to look toward when that individual no longer runs things," he said. "We think that change is around the corner in Cuba and it's all about who's running the show." Gutierrez continued by explaining that Cuba's ultimate goal is a world without the U.S. "It becomes difficult to do business with someone who wants you to disappear," he said. The nation's hope is that the leadership of Cuba will change and that will spark other policy changes in the country. "No one wants an enemy 90 miles away. We just want to see people free." Other speakers at the U.S. Wheat Associates' Trade Policy Symposium Feb. 4, included Gregg Young, assistant deputy director of the U.S. Department of Agriculture-Foreign Agricultural Service's Regional and Bilateral Negotiations and Agreements Division; Craig Thorn, a partner with DTB Associates; Bruce Babcock, a professor and director of the Center for Agricultural and Rural Development at Iowa State University; and Michael Dwyer, senior agricultural economist, USDA-FAS, Office of Global Analysis. Jennifer M. Latzke can be reached by phone at 620-227-1807, or by e-mail at jlatzke@hpj.com. 3/10/08 Date: 3/5/08 Advertisement
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