U.S.-Colombia Trade Promotion Agreement Goes Into Force
The U.S.-Colombia Trade Promotion Agreement (CTPA) went into effect May 15, 2012.
President Barack Obama signed CTPA into law in October 2011, and its implementation was contingent on compliance with various legal requirements and procedures, all of which now have been confirmed. Among other provisions, more than 80 percent of U.S. exports to Colombia of consumer and industrial products - including all qualified U.S. textile and apparel exports - and more than half of U.S. exports to Colombia of agricultural commodities are no longer subject to duties.
U.S. textile and apparel exports to Colombia must meet CTPA's rules of origin criteria in order to qualify for duty-free status. Tariffs on such exports ranged from 5 to 20 percent previously. 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 U.S. exports will grow by more than $1.1 billion as a result of CTPA, and that U.S. gross domestic product will grow 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.