On Thursday, the White House announced new trade agreements with El Salvador, Argentina, Ecuador, and Guatemala. In a press release, the Trump administration gave a few details as to the meat of the agreements.
- These deals secure commitments on economic and national security issues to strengthen supply chains and trade partnerships in the region, deepening bilateral trade and investment cooperation to provide American exporters with unprecedented access to markets in Central and South America.
- The deals will help U.S. farmers, ranchers, fishermen, small businesses, and manufacturers to increase U.S. exports to and expand business opportunities with these trading partners.
- Today’s announcements underscore the Administration’s unwavering commitment to fair and balanced trade at every opportunity to protect and strengthen our economic and national security.
A Fox Business story had a few more details:
Trade Representative Jamieson Greer confirmed to Fox News that the U.S. will lower tariffs on certain foods that the country does not produce enough of as part of the agreements. Additionally, Greer said that the lowering of tariffs on food will be extended to agreements with other nations that have deals with the U.S.
"Today’s announcement shows that America can defend its domestic production while obtaining expansive market access with our trading partners," the White House said in a fact sheet on the deals.
Senior administration officials said that under the deals, reciprocal rates will remain in place, but certain items would have lower tariffs, such as things that cannot be produced in the U.S., including coffee, bananas and cocoa. However, most imports will not qualify under the deals and for those goods, Argentina, Guatemala and El Salvador will be subject to a 10% tariff, while Ecuador will have a 15% tariff.
These are significant deals, economically and politically. Significant in the deal with Argentina is a reduction in duties on Argentine beef.
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The United States is also agreeing to extend Most Favored Nation status to these countries for "certain originating goods from these countries that cannot be grown, mined, or naturally produced in the United States in sufficient quantities."
It's interesting to note that part of Ecuador's end of the deal is a promise to enhance environmental policies:
- Ecuador has committed to adopt and maintain high levels of environmental protection, take measures to improve forest sector governance and combat illegal logging, and fully implement the obligations of the WTO Agreement on Fisheries Subsidies.
There has been a great deal of hot air injected into the atmosphere concerning President Trump's heavy-handed use of tariffs as a negotiating tool, but in this case, it seems to be working. It may be months before all the impacts of these deals are known, but it's progress; the Trump administration is doing what the president promised on the campaign trail.
The wild card in this is Venezuela. Bringing more prosperity to other Latin American nations via trade while simultaneously putting pressure on Venezuela by detonating cartel drug smuggling boats and stationing some pretty serious naval forces in the Caribbean has to have El Presidente Maduro losing some sleep. Could economic pressure bring about some change in Venezuela?
A lot of wheels are turning right now. It's an interesting time.
Editor’s Note: Thanks to President Trump’s leadership and bold policies, America’s economy is back on track.
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