The National Association of Manufacturers is happy that at long last, starting next month, manufacturers in the United States will obtain duty-free access to the Colombian market. Signed six years ago and passed by Congress last October, the agreement opens South America’s third-largest market to us.
President Obama’s announcement that the U.S. – Colombia Free Trade Agreement (FTA) will go into effect May 15th is good news for manufacturers. We have been waiting a long time, but are pleased that at last we can utilize our competitiveness and boost American exports and jobs.
Colombia’s tariffs on U.S. manufactured goods are formidable, raising the cost of American products sold in Colombia by 15 percent. Now, with that disadvantage disappearing on most U.S. products next month, U.S. companies will see growing demand for their products.
Colombian exporters have long had duty-free access to the U.S. market, but it has been subject to the whims of Congress. The agreement, while not giving Colombian exporters an added price advantage, does give them and their U.S. customers certainty that import duties on Colombian products will never increase in the future.
The Colombian market for imported manufactured goods is large and growing. Last year Colombia imported $45 billion of manufactured goods. Their imports of these goods from the United States was $10 billion – giving us a 22 percent share of their import market for manufacturers. The NAM expects that share will rise as U.S. exporters recognize that this new market is available. We also call on the Commerce Department to publicize the new opportunities through its extensive network and to increase its trade promotion resources for the Colombian market.
It was a long road getting here, but rather than looking back at the reasons why it took so long, the NAM looks forward to the new opportunities for manufacturers in the United States which will help create new jobs.
Frank Vargo is vice president of international economic affairs, National Association of Manufacturers.