US – Colombia Trade Agreement Offers Opportunities for Doing Business in Colombia

With the U.S-Colombia Trade Promotion Agreement entering into force May 15th, American businesses will have substantially increased access to South America’s third largest economy.  On this date tariffs on over 80 percent of U.S exports of consumer and industrial products will be eliminated, along with more than half of agricultural commodity exports. In light of the new opportunities and advantages that this Agreement offers, it may be a good time to start considering exporting to Colombia.

Wisconsin exports to Colombia from 1997 to 2010 accounted for a 416% increase. From 2007 to 2010, total Wisconsin exports to Colombia more than doubled from $84.7 million to $181.9 million. Wisconsin primarily supplies machinery, chemical products, paper goods, and computer and electronic products to Colombia.  Wisconsin companies exporting machinery and equipment will benefit from the removal of tariffs from 70 percent of infrastructure and machinery products and the elimination of tariffs on 92 percent of agricultural and construction equipment.  Nearly 100 percent of exports of computer and electronic products will now be duty free, whereas previously exporters were paying tariffs between 8% and 15%.  With the elimination of most tariffs on May 15th, Wisconsin exporters will be able to compete more effectively in the Colombian market.

Colombia has a population of over 46 million and a per capita GDP of $10,155. In terms of population, it is the second largest Spanish-speaking country in the world after Mexico.  Because it has five well-established commercial hubs, namely the cities of Bogota, Medellin, Barranquilla, Cali and Cartagena, Colombia offers unique opportunities.  These multiple commercial hubs are accessible to U.S exporters, unlike the majority of Latin American countries which have only one or two major cities.  These cities and many other secondary cities are close enough together so that it is often possible to have one partner (agent, distributor, or representative) covering the entire country.

The U.S is already Colombia’s biggest supplier and has established close commercial and investment ties since the liberalization of the Colombian economy in the 1990’s.  Recent improvements in political stability, economic health, and security have made it an increasingly inviting country for international investment and business opportunities. As such, Colombia’s “Ease of Doing Business” rank as evaluated by the World Bank has jumped five spots for 2012, now ranking 42 out of 183 economies around the world.

For additional information on Colombia, please see the U.S Commercial Service’s 2012 Doing Business in Colombia Country Commercial Guide: http://www.buyusainfo.net/docs/x_2326622.pdf

Web Resources Provide More Information on Free Trade Agreements

The International Trade Administration has prepared a comprehensive website with information about the various U.S. free trade agreements currently in effect with other countries and regions.  Why should you care about free trade agreements?  If you are looking to export your product or service, the United States may have negotiated favorable treatment for your products through a free trade agreement with the countries you are interested in.  This treatment makes it easier for you to export to that country’s market.  It may also give your product or service a competitive advantage versus products from suppliers in other countries.

The U.S. currently has 12 free trade agreements in effect with 18 foreign countries.  The free trade agreement with Colombia is going into effect on May 15.  The free trade agreement website provides details about each agreement, including information about rules of origin and how to document your shipments in order to obtain FTA benefits.  Go to: www.export.gov/fta

The FTA Tariff Tool available from the same website also allows you to calculate your current duty rate to FTA countries, as well as future rates as tariffs are gradually reduced.  Go to: http://export.gov/FTA/ftatarifftool/index.asp

Trans-Pacific Partnership: Enhancing Trade and Investment in the Asia-Pacific

The United States is participating in the Trans-Pacific Partnership (TPP) negotiations in hopes of bolstering U.S economic growth and creating high quality domestic jobs through the expansion of American exports to the Asia-Pacific, a region with some of the world’s strongest markets representing 40 percent of global trade. The booming economies of the Asia-Pacific are major targets for U.S manufactured goods and services. U.S exports for commercial products and agricultural commodities in 2010 amounted to 61% and 72% of total U.S exports for these sectors respectively.

In addition to the U.S, partner nations in the TPP framework include Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, and Vietnam.   Other countries such as Japan and Canada have expressed an interest in joining as well.  So far there have been nine rounds of negotiations and TPP leaders are eager to finalize an agreement as soon as possible. The five defining features of the agreement include the following:

                ▪ Comprehensive  market access: Eliminating tariffs and other barriers to trade and investment to allow for new opportunities for businesses and workers

                ▪ Fully regional agreement:  Integrated production and supply chains among the TPP members to help support goals of creating jobs, improving living standards, and promoting sustainable growth

            ▪ Cross-cutting trade issues

                ▪ New trade challenges

                ▪ Living agreement: Updating the agreement as needed to address developing trade issues in addition to making appropriate modifications upon entry of new members

If you would like additional information about the Trans-Pacific Partnership, please go to: http://www.ustr.gov/about-us/press-office/fact-sheets/2011/november/united-states-trans-pacific-partnership

China Business Handbook Now Available

The China Business Handbook, a 60-page guide to doing business in China, is now available in PDF file format.  The handbook was prepared by the U.S. Commercial Service in cooperation with a number of private-sector China experts. 

                                                                                                                                             

The contents of the handbook are as follows:

Chapter 1: General Overview of Doing Business  in China -- Market Overview; Market Challenges; Market Opportunities; Market Entry; Selling U.S. Products and Services; Trade Promotion

Chapter 2: Regions and Sectors to Watch -- The Yangtze River Delta; China’s Rising Middle Class

Chapter 3: Business Advisory -- Choosing Your China Structure; Intellectual Property Rights in China

Chapter 4: Looking Beyond the Initial Investment – Labor; Taxes; Maintaining Chinese Financial Accounts

Chapter 5: Sector Opportunities – Overview; Food & Beverage; Healthcare; Clean Tech & Energy; Environmental Infrastructure; Luxury Goods; Automotive; Machinery; Chemicals

A copy of the China Business Handbook can be sent to you as a PDF e-mail attachment.  If you would like to receive a copy, please contact the Milwaukee Export Assistance Center at (414) 297-3473 or e-mail Office.Milwaukee@trade.gov. 

Basic Guide to Exporting Now Available as an MP3 Audio File – Six Programs Remain in Basics of Exporting Webinar Series

Need a way to while away those long hours behind the wheel?  The 2008 edition of the Basic Guide to Exporting is available as an mp3 audio file in cooperation with Michigan State University.  Each of the 17 chapters is a distinct file and can be downloaded separately for free.  To access the files, go to: http://globaledge.msu.edu/Reference-Desk/Online-Course-Modules/Exporting

You may also read the entire 2012 Basic Guide to Exporting on the internet at: http://export.gov/basicguide/

As part of the National Export Initiative, a number of programs are still available from the Commerce Department’s Trade Information Center in our Basics of Exporting webinar series.  Remaining programs are: Taking Advantage of NAFTA (May 16); Understanding Export Controls (May 23); How to Protect Your Intellectual Property (May 24); Completing Certificates of Origin (May 30); Financing Exports and Getting Paid (June 13); and Temporary Exports (June 27).  All of these one-hour webinars are held at 1:00 pm Central Time and can be accessed via your internet-connected computer for the video portion and a telephone line for the audio.  The cost is $15 per webinar.  For more information and online registration, please visit: http://export.gov/articles/eg_main_022213.asp

Maquiladora Sales Mission and B2B Event in El Paso / Ciudad Juarez Offers Access to Mexican Buyers

The El Paso, U.S. Export Assistance Center will lead an Educational and Sales Mission to the maquiladora industry in Ciudad Juarez, Chihuahua, on June 20, 2012.  In addition to learning more about the mechanics of supplying products and services to the maquiladoras, American exporters will meet material buyers during the mission.  This is an opportunity to learn more about the maquiladora industry and promote your company to the Mexican assembly plants.  The cost of the Sales Mission is $425 and space is limited.  On June 21, 2012 you will attend the Maquiladora Supplier Day event in El Paso, Texas, where you will have a chance to meet more material buyers in short one-on-one meetings.

For more information contact Robert Queen, Director of the El Paso, Texas U.S. Export Assistance Center at 915-929-6971 or robert.queen@trade.gov