U.S.–Korea Free Trade Agreement Has Huge Potential for U.S. Dairy Exports
IDFA welcomed news from U.S. Trade Representative Rob Portman earlier this month that the administration plans to negotiate a free trade agreement (FTA) with the Republic of Korea (South Korea), which Portman characterized as the "most commercially significant free trade negotiation we have embarked on in 15 years."
"The U.S.–Korea FTA has the potential to greatly benefit U.S. dairy exporters," said Clay Hough, IDFA senior vice president and general counsel.
Last year South Koreans imported about $58 million worth of dairy products from the United States — about 25% of Korea's total dairy imports. Korea is one of Asia's fastest growing economies, and as income grows so does consumption of dairy products.
"In particular, we see great potential for exports of cheese and whey products," Hough said.
To begin work in support of the agreement, IDFA has joined the U.S.-Korea FTA Business Coalition and the AgTrade Coalition's Korea FTA task force. In addition, IDFA is working with its international affairs committee on the effort, and is asking any IDFA members with comments or issues regarding trade with Korea to contact Helen Medina at email@example.com or 202-220-3507. Such input will help IDFA better represent dairy processors as the government works on the agreement.
The dairy industry is united in its support of the FTA, with the National Milk Producers Federation and the U.S. Dairy Export Council also heralding the news and noting Korea's strategic importance to U.S. dairy.
However, competition from Australia, the European Union and New Zealand continues to be strong. IDFA is looking forward to an aggressive agreement that will immediately eliminate dairy tariffs and other non-tariff barriers that hinder commerce between South Korea and the United States.
South Korea is the world's 10th largest economy, with an annual gross domestic product (GDP) rapidly approaching $1 trillion. It is the fifth largest U.S. export market for agricultural products.
"Removing trade and investment barriers between our two nations through an FTA will increase market access for our farmers, ranchers, workers and businesses to the dynamic and growing Korean economy, boosting trade in goods and services," Portman said.
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Posted February 27, 2006