The Canada-Colombia free trade agreement went into effect today. Canadian exports are now duty-free in Colombia. Since the effective duty on manufactured imports into Colombia is 15 percent, that gives Canadian manufacturers an attractive advantage.
This adds further to the imperative of passing and implementing the U.S. – Colombia trade agreement. Distributors, wholesalers, and retailers in Colombia may be willing to bear a 15 percent disadvantage in importing U.S. goods for a short time; but if they see that time difference persisting, many of them will consider shifting to Canadian suppliers wherever Canadian and American products compete with each other.
Passage of the U.S. – Colombia trade agreement by Congress does not mean the agreement goes into effect the next day. Some months are needed after passage to ensure that both governments have done what they said they would do, that customs officials have their procedures and systems in place, and that necessary regulations have been published. So every day of legislative delay pushes implementation of the U.S. – Colombian agreement one more day into the future – adding to the risk of losing U.S. business.
Also, every day the pending trade agreements with Colombia, Korea, and Panama languish, American workers lose another $8 million in wages and benefits. That adds up. As of the afternoon of August 15, 2011, their cumulative loss was a staggering $12 billion.
Opponents of trade agreements are badly mistaken in thinking they hurt our trade. Over the past three years, American manufacturers have enjoyed a cumulative surplus of over $70 billion with our existing trade agreement partners. During that same time, however, manufacturers faced a cumulative deficit of $1.3 trillion with countries that have not entered into trade agreements with us.
It is time to open more markets to American goods and services, starting with quick action by Congress to pass the three pending agreements.