America-United States Free Trade Agreement (CAFTA-DR)
North Carolina Farmers Will Benefit
Exports of farm products
help boost North Carolina’s farm prices and income. Such exports help support
about 20,540 jobs both on and off the farm in food processing, storage, and
transportation. In 2003, North Carolina's farm cash receipts were $6.9 billion,
and agricultural exports were estimated at $1.3 billion, putting its reliance on
agricultural exports at 19 percent. Implementation of the Dominican
Republic-Central America-United States Free Trade Agreement (CAFTA-DR) will increase North Carolina’s exports of
North Carolina Benefits From
the U.S.- CAFTA-DR Free Trade
Despite over $1.6 billion in
U.S. farm exports in 2003, CAFTA-DR countries continue to impose high tariffs
and other barriers on most agricultural products, including North Carolina’s key
exports. A primary U.S. objective was to change the "one-way-street" of
duty-free access currently enjoyed by most CAFTA-DR exports into a "two-way-street" that provides U.S.
suppliers with access to these markets and levels the playing field with other
competitors. This objective was achieved. Over 50 agricultural industry and farm
groups, including the American Farm Bureau support the FTA.
As the top source of farm cash
receipts in the state with sales ranked 2nd nationally, North
Carolina pork producers benefit from the duty-free access on pork cuts for each
U.S. pork exporters currently face duties as high as 47
percent, and the WTO permits duties as high as 60 percent.
The opportunity for trade created through the TRQs total
13,613 tons, expanding by 5 to 15 percent per year until duties are
Central American countries will immediately eliminate
duties on bacon and some offal products, while the Dominican Republic will
establish TRQs for bacon and fat that expand annually.
All CAFTA-DR duties will be eliminated within 15 years
and certain products will be subject to safeguards in some countries.
CAFTA-DR countries are working toward the recognition of
the U.S. meat inspection and certification systems in order to facilitate
The National Pork Producers Council, the American Meat
Institute, the U.S. Meat Export Federation, and the National Renderers
Association have expressed support publicly for the CAFTA-DR FTA.
Poultry. As the 3rd
largest agricultural export from the state, North Carolina poultry producers and
processors benefit from the FTA.
As the 4th
largest agricultural export from the state, North Carolina cotton producers
benefit from zero tariffs that the FTA locks-in immediately for markets worth
over $73.1 million to U.S. cotton suppliers. Under the WTO, CAFTA-DR countries
could raise duties on cotton to 35 to 60 percent, depending on the country.
Soybeans and Products.
With over 1.3
million acres planted in the state, North Carolina soybean producers will
benefit from the FTA.
CAFTA-DR countries will provide immediate
duty-free access for soybeans. Duties on soybean meal and flour will be
eliminated immediately in most CAFTA-DR countries.
Most CAFTA-DR countries will immediately eliminate duties
on crude soybean oil, and the current duties on refined soybean oil phased
out over 12 to 15 years.
The American Soybean
Association, the National Grain and Feed Association, and the National
Oilseed Processors Association have expressed support publicly for the CAFTA-DR FTA.
North Carolina, the
nation’s top exporter of tobacco, benefits from the FTA.
Under the FTA, duties will be immediately eliminated in
El Salvador, Guatemala, Honduras and Nicaragua. Costa Rica and the Dominican
Republic will eliminate duties in 10 years.
U.S. tariffs on tobacco will be phased-out over a 15-year
period, except where current duty treatment under CBI grants duty-free
access. For those products, the tariff will be set at zero immediately.
State Fact Sheets