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October 5, 2017
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Japan is No. 1 Target for New FTA

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Japan is No. 1 Target for New FTA
AgriPulse.com

Washington, Oct. 4, 2017 – The U.S. needs to improve trade relationships with Pacific Rim countries where competitors like Australia and the European Union have advantages over U.S. exporters, USDA Secretary Sonny Perdue said today. Japan is the first target for new bilateral talks, Perdue stressed.

“We want to bring down high tariffs on beef and pork and dairy and fruits and vegetables and many other products,” Perdue said about a potential free trade agreement with Japan during a forum hosted by the Washington International Trade Association. “We’re eager to enter into bilateral trade negotiations with Japan and lower those barriers to address the preferences that they seem to have currently for Australia, the EU, Chile, Mexico and other countries.”

That may come as a relief for U.S. cattle ranchers and beef exporters, who were disappointed when President Donald Trump pulled the U.S. out of the Trans-Pacific Partnership (TPP), a massive FTA with 11 other nations, including Japan and Vietnam.

Japan had agreed to slash tariffs on several U.S. farm commodities such as beef, potentially taking away Australia’s trade advantage in selling to Japan. The country maintains a 38.5 percent tariff on U.S. beef that would have gradually gone down to 9 percent under TPP.

Japan is the largest foreign market for U.S. potato products. It buys about $325 million worth of U.S. spuds every year, despite tariffs of up to 8.5 percent that would have been removed under TPP.

But the Trump administration is concentrating on bilateral FTAs now, and Japan is the highest priority, Perdue said.

“We think our geopolitical relationship with Japan should lead to a preferred status in (trade) as well,” he said.

Still, the list of countries that the administration wants to improve trading relations with is a long one, and the U.S., as an agricultural production giant, should have a natural advantage over many competing nations, Perdue said.

“We have significant productive advantages over these countries to grow grain, fruits and produce livestock products,” he said. “We need to level the playing field with competitors who have preferential agreements and generally strengthen our commercial ties in this key area of the world.”

In addition to Japan, Perdue said the U.S. is also talking to Indonesia, Vietnam, Thailand, Taiwan, the Philippines and India about FTAs. 

The next big opportunity to make headway with some of these countries will likely be when Trump travels to Southeast Asia this fall, Perdue said, and USDA is already working on preparation for the trip, Perdue said.

“The president will be making a major Southeast Asia trip… and we are advising his policy makers now on the opportunities we have in that arena,” Perdue said.

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