Free trade secured with Central America
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Manufacturing News, Source : The Manufacturer US
Published : 29 Apr 2005 16:15
The new U.S.-Central American and Dominican Republic Free Trade Agreement (CAFTA-DR) has been hailed as an “unambiguous winner” by the National Association of Manufacturers.
The CAFTA-DR agreement applies to Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic. Testifying before the House Energy and Commerce Subcommittee on Commerce, Trade and Consumer Protection, the NAM’s top trade expert Frank Vargo told lawmakers that there is “strong support for this comprehensive agreement. It levels the playing field by giving U.S. producers the same access to CAFTA-DR markets as their producers enjoy in the U.S. market.”
Vargo, NAM Vice President for International Economic Affairs, also claimed that the agreement “strengthens the ability of U.S. and Central American producers to compete against China and other Asian nations.” Without the agreement, Vargo pointed out, the CAFTA-DR countries’ apparel exports to the U.S would continue to be under threat from Asian currency manipulations. Economic recession in the CAFTA region could knock U.S. exports down by as much as $4 billion.
Vargo explained that exports of U.S. manufactured goods to the six CAFTA-DR countries will become duty-free, while European and other competitors will still face tariffs and other trade barriers. As a direct result, U.S. manufacturers stand to increase exports by $1 billion and create approximately 12,000 job opportunities for American workers. “Thus, the total impact of CAFTA-DR on U.S. exports could be as much as $5 billion and 60,000 related American jobs,” Vargo said.
Nearly 80 percent of CAFTA exports to the US are already duty-free, thanks to existing one-way market access programs, so there is unlikely to be a significant increase in US imports from the region.
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