Publication Number: 3888

Report Title: The Impact of the Andean Trade Preference Act

Investigation Number: 332-352

Author's name(s): Walker Pollard, Magda Kornis, Joanne Guth, Laura Rodriguez, Timothy McCarty, Joanna Bonarriva

Date Published: September 2006

Report Description/Introductory Text: The Andean Trade Preference Act (ATPA) provides preferential treatment of U.S. imports from Bolivia, Colombia, Ecuador, and Peru. The overall effect of ATPA-exclusive imports (those ineligible for other tariff preferences) on the U.S. economy and consumers continued to be negligible in 2005. However, U.S. imports of ATPA-exclusive products (as defined by 8-digit Harmonized Tariff Schedule classifications) were estimated to have potentially significant effects on domestic industries producing asparagus; fresh-cut roses; and fresh-cut chrysanthemums, carnations, anthuriums, and orchids. U.S. imports of all of the 20 leading ATPA-exclusive items produced net welfare gains for U.S. consumers in 2005. The probable future effect of ATPA on the United States is also expected to be minimal in most sectors, even if trade preferences were to continue in some form following the expiration of ATPA at the end of 2006.

ATPA continued to have a small, indirect effect on drug-related crop eradication and crop substitution efforts in the ATPA countries in 2005. Net coca cultivation in the Andes continued at roughly its lowest point in two decades, although cultivation has increased slowly in Bolivia and Peru since 2001. ATPA trade preferences remained to support industries that provide jobs for workers who might otherwise have participated in illicit coca cultivation. In 2005, exports to the United States under ATPA increased further, supporting job growth in industries producing goods such as flowers in Colombia and Ecuador, asparagus and other agricultural products in Peru, and textiles and apparel throughout the ATPA region.

Topics Covered: foreign trade, international trade, imports, exports, ATPA, ATPDEA, Andean, Andean Trade Preference Act, Andean Trade Promotion and Drug Eradication Act, foreign investment, asparagus, cut flowers

Countries: United States, Bolivia, Colombia, Ecuador, Peru

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