AFF Sentinel Vol.2, #13

CAFTA-DR Proposed Trade Agreement Next Target

Flush with their success in wresting control of border trade with Canada from the USDA and turning it over to lawyers and judges, R-CALF is now turning its attention to CAFTA-DR - the Central American Free Trade Agreement. They are on record as opposing this and other trade agreements because they oppose beef imports of most any kind.

Let's take a look at the proposed CAFTA-DR agreement and see what's afoot.

• Tariffs on U.S. beef exported into the region now range as high as 40 percent. The agreement would eliminate tariffs on U. S. Choice and Prime grade beef now and phase out tariffs on other beef over a 15-year period. The countries involved are Costa Rica, Nicaragua, Guatemala, El Salvador, Honduras and the Dominican Republic.
• The region has had an existing quota limit on the beef they could export into the U.S. and has never come close to filling that quota. The most they have ever shipped was 27,000 MT or a quarter of one percent of our production total. The quota is about 64,000 MT, about one-half of one percent of U.S. production. There are additional quotas available under the agreement, should the region every fill the first one, totaling another 0.2 percent of our production.
• The beef that we would ship to them duty- free would be high quality, grain-fed beef for the multi-billion dollar tourist trade in that region. With no tariffs, the cost of beef to this trade would drop by as much as 40 percent. The USMEF estimates that the $12 million in trade now could triple to over $40 million over the next decade.
• Health and sanitation regulations would be in place, just as usual. Import access is always subject to countries and product meeting health and food safety regulations.
• There is no tariff on beef coming into the U.S. now from these or most of the rest of the world and that would not change.
• The beef industry in this region is relatively small. The beef they export is the lean beef the U.S. market needs to mix with our 50/50 trim to produce the huge amounts of ground beef the U.S. market requires.

So what is the problem with that list? R-CALF says that one of its primary reasons for existence is trade. However, one usually thinks of a group interested in "trade" as in favor of fostering trade. That is not R-CALF's idea. In fact, their philosophy is much closer in thinking of trade as a threat, much as their Public Citizen allies see trade - as a threat to domestic industries and union workers, not as a boost to the economic growth of domestic production chains.

R-CALF opposes imports in principle. If a country can still export, that's fine but only as a bonus, not a primary goal. They do not understand the concept of reputation and credibility in international trade. They do not see trade as a two-way street, as imports and exports. R-CALF is na?ve enough to believe a nation can set itself up as an "export only" nation. They have already demonstrated their naivet? over the interlocking repercussions between the Canadian and Japanese negotiations. This would appear to be more of the same.

Next time: Is the Fear Based In Fact?