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U.S. farmers question whether free trade agreements will yield benefits
(Saturday, June 28, 2003 -- CropChoice news) -- The following items are from the Agribusiness Examiner.
1. U.S. growers question whether free trade agreements will result in benefits
JOAN MURPHY, THE PRODUCE NEWS: Chile has become the first South
American nation to sign a free trade agreement with the United States,
clearing the way for tariffs on U.S. and Chilean farm goods to be phased
out. But U.S. growers question whether the mounting agreements under
negotiations with Latin American countries will result in market access
for their products.
"American farmers, workers, consumers and businesses will benefit from
improved access to the Chilean market, and this FTA will provide momentum
to the ongoing negotiations in the Free Trade of the Americas and the
global trade talks,"U.S. Trade Representative Robert Zoellick said June 6
while signing the accord in Miami. "This is an historic agreement that sets
a high benchmark for future FTAs."
The United States and Chile began negotiations on the deal in December
2000, and discussions between the two countries continued until both
parties signed the trade agreement. The first agreement in the region since
the North American Free Trade Agreement in 1993, it represents the first
step in the Bush administrations plan for a massive free trade agreement
for all of Latin America. Congress must still approve the Chile-U.S.
agreement before it can go into effect.
But there will be little short-term gain for Chilean fruit importers, said
Jim DeMalo of Philadelphia-based U.S.Produce Exchange. Chilean fruits enjoy
relatively low tariffs, he said.
One item that may change in price is Chilean avocados, which are assessed a
$1.50 per-box duty. This would be phased out over the coming years. Chilean
fruits experience little overlap with California products, he said, and
imported avocados are important in supplementing the U.S. supply to meet
increasing demand.
According to a new report by the U.S. International Trade Commission, the
trade agreement will likely result in a "measurable increase" of U.S.
imports of avocados, as Chile is the leading supplier of U.S. imports and
the United States is Chiles leading export market.
But the impact on U.S. employment will be limited, said the report, because
Chilean production is counter-seasonal (mainly August-January) to U.S.
production (mainly March-August), and these imports compete more directly
with products from Mexico and the Dominican Republic.
Also, U.S. avocado exports to Chile are not expected to rise as a result of
the agreement, said the ITC report, which states that Chile represents a
negligible market for U.S.exports of fruit owing to its small size, level
of disposable income and a competitive domestic supply. Because of Chiles
small size, U.S. producers target other markets for fruit exports such as
Canada, the European Union, Japan and Mexico.
But U.S. fruit and vegetable growers are concerned with the Bush
administrations emphasis on free trade agreements with Latin American
countries, which they say will favor imports here rather than focusing
efforts on opening U.S. agricultural market access to Asian and European
nations.
"Market access is key to us," said Robert Guenther of the United Fresh
Fruit & Vegetable Association, who questioned whether the accord would
result in a viable market for U.S. produce. The Chilean agreement will
"put more pressure on the U.S. market" as everyone competes for consumer
dollars, he said. With the Chilean agreement finalized, the Bush
administration is now focusing efforts on similar agreements with Costa
Rica, El Salvador, Guatemala, Nicaragua and Honduras.
The Grocery Manufacturers of America praised the new agreement for
immediately eliminating tariffs on more than 85% of consumer and industrial
goods. The remaining product tariffs will be eliminated within four to 12
years, including those for sugar and dairy products.
Specifically, the U.S.-Chile FTA provides U.S. manufacturers of breakfast
cereals, pasta and other products with immediate duty-free access to
Chilean markets, allowing U.S. food manufacturers to regain their
competitiveness against Canadian and South American products that already
receive zero tariff treatment in Chile.
"GMA fully supports the aims of the U.S.-Chile Free Trade Agreement to
increase global trade and market access, and to eliminate trade distorting
tariffs," said GMA Director of International Trade Sarah Thorn. Chile has
free trade agreements with Canada, the European Union, Mexico and South
Korea. The U.S. has reached free trade agreements with Canada, Mexico,
Israel and Jordan, plus Singapore, which has yet to be approved by Congress.
2. NAFTA forcing Mexican farmers to flee northward
TESSIE BORDEN AND SERGIO BUSTOS, THE ARIZONA REPUBLIC: Wilfrido Iglesias
Aņorve, a 78-year-old Mexican citrus farmer, expected at least some of his
seven children to remain part of the family business.
But three years ago, most of them left Iglesias Aņorve's 25-acre orange
grove in the small farming town of San Pablo Papantla in Veracruz state. It
seems unlikely they'll ever return home.
One of his children is toiling in Florida's citrus groves. Another is in
Canada. Three others are in Mexico City with plans to move to the United
States. The other two are still at home, but Iglesias Aņorve figures they,
too, will leave someday.
Four grandchildren also left: Two boys are in the United States, and two
girls work in
manufacturing plants near the U.S.-Mexican border.
"The young people, almost all of them, have left," Iglesias Aņorve said.
The fact that Iglesias Aņorve's children have chosen to leave their
birthplace and migrate elsewhere is not unusual in Mexico. What is unusual
is that these migrants come from Veracruz, a state with rich farming soil
and little history of outward migration.
Immigration experts on both sides of the border say the North American Free
Trade Agreement, which took effect in 1994, has given birth to a second
wave of Mexican immigrants. They come from states such as Veracruz,
Tabasco, Yucatan, Chiapas, Campeche, Quintana Roo and Sinaloa.
Manuel Angel Gomez Cruz, a researcher at Mexico's Autonomous University of
Chapingo, said that before the trade pact, migrants typically ventured from
a handful of Mexican states. Those states - Jalisco, Michoacan, Zacatecas,
Guanajuato, Oaxaca and Guerrero - featured poor soil and a long migrant
tradition that dated back to the end of the bracero program, which ran from
1942 to 1964 and allowed Mexicans to temporarily work in agriculture in the
United States.
Veracruz and other states were self-sufficient and migration-free just five
years ago, Gomez Cruz said. He said ending many tariffs on food products
under the North American Free Trade Agreement, coupled with bad Mexican
farm policy, has left 25 million people with little choice but to cross the
border.
"At the moment you destroy (agriculture), where are 25 million people going
to go?" Gomez Cruz asked. "If we were a developed country, maybe we could
find them work in other areas. But right now our country has an
unemployment problem."
The displaced farmers have been a major factor in the surge of undocumented
immigrants from Mexico living in the United States. Their numbers nearly
doubled, to five million, from 1996 to 2000, according to the latest
government estimates.
Arrests of undocumented immigrants also have climbed, from fewer than one
million in 1994 to 1.6 million in 2000, an all-time record, according to
the U.S. Border Patrol.
Though a handful of large-scale farming operators have been able to reap
some trade success, small and midlevel farmers in Mexico didn't stand a
chance of competing against their northern neighbors, said Benito Muņoz,
treasurer of the San Luis Rio Colorado, Mexico, chapter of BONFIL, a
farmers cooperative.
The hardest hit are grain growers who don't come close to producing
exportable amounts and who don't receive hefty government subsidies like
their U.S. counterparts, Muņoz said. Nor can they get low-interest bank
loans to expand their business.
"The difference is abysmal at every level," said Muņoz, whose group
represents 287 farmers with average plot sizes of 60 acres. "And NAFTA is
doing nothing to help us out. Some say it's been great. Sure, a great
disappointment."
Mexico's unemployment rate grew 2.5 percent last year, Gomez Cruz said.
Much of that loss occurred as border factories moved operations to the Far
East, where labor had grown cheaper over the years and communist countries,
like China, opened their economies to foreign investors.
Mexico now must create 1.2 million to 1.5 million jobs each year to keep
the economy from shrinking.
In December, Mexican peasants and small farmer organizations began
protesting a measure in NAFTA that lifted or reduced tariffs on several
American farm products flowing to Mexico.
They wanted President Vicente Fox to renegotiate the agriculture chapter of
NAFTA and devise a new internal farm policy.
In April, the farmers got a little bit of what they were seeking.
After four months of negotiation, Fox and the small farmer groups signed a
deal. It contains, among other things, a promise from Fox to ask the United
States and Canada about revising NAFTA provisions on white corn and beans
and perhaps substituting it with a permanent import control mechanism that
would "protect the legitimate interests of the national producers."
U.S. farmers grow and sell yellow, not white, corn. White corn is what is
traditionally used to make tortillas, a mainstay of the Mexican diet. But
Mexican farmers say American yellow corn, which the government buys cheaply
to keep the price of tortillas low, has been flooding out their white corn,
making it impossible to stay competitive.
The farmers agreement also provides about $266 million in emergency funding
for farmers, the titling of cooperative land through existing programs and
a promise to seek resolution of 165 court cases involving farm leaders,
linked to their arrests during NAFTA protests.
Gomez Cruz doesn't trust the deal. He said Mexico should move to a policy
that integrates the farm sector as part of the entire economy and takes
into account what its millions of people can buy when they have a good
income. More indifference, he said, will only send more undocumented
immigrants to the United States and could turn farmers to illegal drug
production and smuggling.
"One cannot predict the political scenario that is approaching at this
moment," Gomez Cruz said. "Your skin crawls when you hear the aggression
among the farmers. There are people who are entrepreneurs . . . who are up
to their necks, and they don't know what to do."
Other leaders who opposed the deal agree.
"There is a wearing down, a worsening of the situation in this country,"
farm leader Jaime Castillo Ulloa said. "Sooner or later, the problem is
going to explode."
Some experts said the refusal of U.S. and Mexican negotiators to include
migration and labor issues as part of the historic pact is now coming back
to haunt both countries.
Jorge Bustamante, former president of Mexico's College of the Northern
Frontier who was a consultant during NAFTA talks, said U.S. and Mexican
negotiators chose not to include the two issues because they were too
politically explosive.
"The United States opposed including migration in the process, unless
Mexico was willing to include oil," Bustamante said. "Mexico was not
willing to let oil in, so the United States was not willing to let
migration in."
The conflict arose again in May when a U.S. congressional committee called
for linking any new immigration deal to U.S. investment in Mexico's
state-run oil company. Though a non-binding resolution, the decision caused
a furor in Mexico.
Census Bureau figures show that the number of people born in Mexico or of
Mexican descent grew faster than the population of any other ethnic or
racial group in the United States from 1990 to 2000. An estimated 21
million people in the United States claimed ties to Mexico in 2000, up from
13 million in 1990.
Immigration patterns also have changed. Since NAFTA took effect, Mexicans
have left every corner of their country for every corner of the United States.
Mexicans and Mexican-Americans no longer settle solely in border states
like California, Arizona and Texas. They are putting down roots in states
like North Carolina, Georgia and Tennessee.
The number of Mexicans in North Carolina grew to nearly 247,000 in 2000, up
from about 33,000 in 1990. The increase of about 650% topped all other states.
Experts say it is no coincidence that a record number of Mexicans have
emigrated since NAFTA rolled out but dismiss the notion that the trade pact
was the only factor driving immigration in the 1990s.
Demetrios Papademetriou, co-director of the Migration Policy Institute, a
think tank in Washington, D.C., said the aging U.S. population, the rise in
college-educated Americans and the growing ties between U.S. employers and
Mexican workers over the past few decades are part of the new immigration
trend.
"Look at the restaurant industry in New York," he said. "During the 1980s,
you would go to the back of a restaurant to find illegal immigrants. Not
anymore. The assistant manager, the waiters, the hostess, these jobs also
are being filled by undocumented immigrants.
"NAFTA or no NAFTA makes no difference," Papademetriou said. "Mexican
migrants will always come." | |
