U.S.-Colombia Trade Promotion Agreement To Go Into Force May 15
Obama signed CTPA into law in October 2011, and its implementation was contingent on compliance with various legal requirements and procedures, including Colombia's fulfillment of the Action Plan Related to Labor Rights, all of which now have been confirmed. Among other provisions, according to the terms of the agreement, more than 80 percent of U.S. exports of consumer and industrial products — including all qualified U.S. textile and apparel exports — to Colombia, and more than half of U.S. exports of agricultural commodities to Colombia will no longer be subject to duties upon CTPA's implementation on May 15.
U.S. textile and apparel exports to Colombia must meet CTPA's rules of origin criteria in order to qualify for duty-free status. Up to the agreement's implementation, tariffs on such exports have ranged from 5 to 20 percent. It is widely believed by U.S. textile industry decision makers that the elimination of tariffs will result in increased textile exports to Colombia, which is the third-largest economy in Central and South America.
The U.S. International Trade Commission estimates that exports of U.S. goods will increase by more than $1.1 billion as a result of CTPA, and that U.S. gross domestic product will increase by $2.5 billion as a result of expanded trade with Colombia. It also notes that the U.S. and Colombian economies are largely complementary in the two-way textile and apparel trade, as U.S. cotton, yarn and fabric exported to Colombia return to the United States in apparel articles produced in Colombia and shipped back to the United States.
"This agreement will provide American businesses, farmers and ranchers with significantly improved access to the third largest economy in South America," said U.S. Trade Representative Ambassador Ron Kirk. "One month from today, the value of the U.S.-Colombia trade agreement will begin to be seen in lower tariffs on autos, consumer goods, agricultural commodities, machinery, and other exports from the United States, which will make our goods more competitive in the Colombian market. That means support for well-paying jobs at home. Taking this next step toward entry into force of this agreement is recognition that Colombia has met the milestones of, and continues to demonstrate its strong commitment to, the Action Plan Related to Labor Rights. We will continue working with the Santos Administration to help it continue to meet its long-term commitments to improve its labor practices and deter violence against labor leaders. We are making good on President Obama's promise to use a new approach to trade and stand up for the protection of workers in the U.S. and around the world."
April 17, 2012