U.S.-Panama Free Trade Agreement goes into effect today
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WASHINGTON, October 31, 2012 - A new U.S.-Panama Free Trade Agreement is set to go into effect today. The pact will do away with most tariffs on American goods, including agricultural products, in the next 15 years.
The agreement “will eliminate tariffs and other barriers to U.S. exports, which will promote economic growth, and expand trade between our two countries,” Ambassador Ron Kirk, the United States Trade Representative, said at a letter signing last Monday. He argued that partnership with Panama's fast-growing economy, predicted to grow five to eight percent annually through 2017, “adds up to support for more well-paying jobs across the United States.”
Half of American agricultural exports to Panama, taxed at 15 percent before the trade agreement, will immediately become duty-free. Others will be reduced more slowly. “Altogether, these agreements will bring an additional $2.2 billion in agricultural exports,” Secretary Vilsack said in a statement.
Beef will also see a dramatic reduction in tariffs. Prime and choice cuts, which faced 30 percent tax rates prior to the agreement, will also see rates gradually reduced. “This is a positive step forward for American cattlemen and women,” Bob McCan, National Cattlemen's Beef Association vice president, said in a press release.
In 2011, the United States exported more than $8.2 billion worth of products to Panama, including $504 million in agricultural products.
The agreement will also give the U.S. access to the $22 billion Panamanian services market; will level the playing field for American investors by providing them protections within Panama; and will allow for greater protections of American intellectual property rights, all according to the White House.
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