Press Release

Secretary Gutierrez Statement on Senate Finance Committee Vote on Peru Trade Promotion Agreement

WASHINGTON—U.S. Commerce Secretary Carlos M. Gutierrez today issued the following statement on the Senate Finance Committee 18-3 vote on the Peru Trade Promotion Agreement.

“I am delighted by this overwhelming, bipartisan vote in the Senate Finance Committee for the Peru Trade Promotion Agreement.I look forward to seeing Congress approve this important agreement.

“I recently traveled to Peru and met with President Garcia and we agreed that this agreement would advance the longstanding friendship and trading relationship between our two nations.

“U.S. exports are now at a historically high level and this is the time to give American exporters the tools needed to continue to expand and grow. The Peru Trade Promotion Agreement would provide economic opportunity and eliminate barriers so American business and agriculture can compete and win in the Peruvian market.

“Congress already allows ninety-eight percent of imports from Peru to enter the United States duty free, while U.S. exports to Peru currently face significant barriers. This agreement would provide U.S. businesses duty-free access to Peru’s growing market.

“This is the first vote on a free trade agreement sincethe Administration and Congress agreed on a path for the consideration of four pending free trade agreements last May.

“I look forward to continued bipartisanship in the pursuit ofamarket-opening,pro-growth trade policy for the American people. I hope Congress will swiftly approve the Peru Trade Promotion Agreement, so that we can then move on to helping pass our FTAs with Colombia, Panama and Korea.”

Background:
Bilateral free trade agreements are one of the best ways to open up foreign markets to U.S. exporters. Currently more than 100 regional trade agreements are being negotiated around the world. Today, the United States has implemented FTAs with 14 countries. Last year, trade with countries with which the United States has FTAs was significantly greater than their relative share of the global economy. Although comprising 7.5 percent of global GDP, not including the United States, those FTA countries accounted for more than 42 percent of U.S. exports.

In 2006, more than 90 percent of Panamanian, Peruvian and Colombian imports into the United States entered duty free under unilateral U.S. trade preference programs, such as the Andean Trade Preferences Act (ATPA) and the Generalized System of Preferences (GSP), or under zero Most Favorite Nations (MFN) tariffs. These FTAs will open these markets to U.S. exporters as they will provide duty-free treatment for U.S. exports to countries that already purchase from the United States.

The Panama, Peru and Colombia FTAs would level the playing field for U.S. workers, businesses and agriculture. The FTAs will give U.S. businesses duty-free access to growing markets with a combined population of approximately 75 million consumers and GDP of almost $246 billion. Between 2002 and 2006, U.S. exports to Peru and Colombia increased by more than 87 percent, with exports reaching $2.9 and $6.7 billion respectively in 2006.

The United States is Peru’s leading trading partner, accounting for 23.3 percent of Peru’s exports and supplying 16.4 percent of the country’s imports in 2006. Peru-U.S. bilateral trade has more than doubled over the past decade from $3 billion in 1996 to $8.8 billion in two-way trade in 2006, due in large part to the ATPA.