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The U.S.-Panama Trade Promotion Agreement eliminates tariffs and other
barriers on most U.S. goods, increasing export opportunities for agricultural
products important to Alabama. With immediate elimination of duties on over 60
percent of current U.S. trade, this agreement changes the one-way street of
duty-free access currently enjoyed by most Panamanian exports into a two-way
street benefiting both countries. The American Farm Bureau strongly supports the
agreement, predicting widespread gains for U.S. agriculture exceeding $190
million per year.
Alabama’s exports to all countries, estimated at $572 million in 2006,
supported about 6,800 jobs, on and off the farm. These export sales make an
important contribution to the Alabama farm economy which had total cash receipts
of $3.7 billion in 2006.
Poultry Meat. With cash receipts of $2.2 billion in 2006, broilers are
Alabama’s leading agricultural industry accounting for nearly 60 percent of the
total farm earnings. Poultry and poultry products are also the state’s top
agricultural export. From 2004 through 2006, U.S. suppliers shipped an average
5,700 tons of poultry meat valued at $7 million to Panama each year. However,
exports are mostly limited to turkey cuts and whole turkeys due to a 260-percent
tariff on broiler leg quarters. Alabama’s poultry industry will benefit from
this agreement.
The 260-percent tariff currently applied to chicken cuts will be
eliminated immediately for mechanically de-boned chicken, within 5 years for
wings and 10 years for other chicken cuts except leg quarters.
Panama will provide immediate duty-free access within a preferential
tariff-rate quota (TRQ) for chicken leg quarters that starts at 660 tons and
grows each year by 10 percent. The 260-percent over-quota tariff will be
eliminated in 18 years.
U.S. poultry exporters will continue to have access to the global
756-ton TRQ for chicken cuts that is part of Panama’s World Trade
Organization commitments.
Panama will eliminate its 15-percent duties on turkey meat immediately
for frozen whole turkeys and most frozen turkey cuts. The 15-percent tariffs
on processed turkey and chicken will be eliminated within 5 years.
In addition, Panama has already implemented our December 2006 bilateral
agreement on sanitary and phytosanitary (SPS) measures by recognizing the
equivalence of the U.S. poultry inspection and disease monitoring systems,
allowing U.S. inspectors to certify poultry for export to Panama without
having each facility and shipment inspected by Panamanian authorities.
Beef. As the second largest source of farm cash receipts for the state,
Alabama’s cattle and calf industry will benefit from this agreement.
Panama will immediately eliminate its 30-percent duty on beef products
of most importance to the U.S. beef industry--prime and choice cuts.
Panama’s tariffs on other cuts of beef will be phased out over 15 years.
The 10-percent tariff on beef tongues and livers will be eliminated in 5
years, and the 15-percent tariffs on other edible offal will be eliminated
immediately.
Panama has already implemented our December 2006 bilateral agreement on
SPS measures, reopening its market to U.S. beef by bringing its import
requirements related to BSE into compliance with international standards.
Panama also accepted the equivalence of the U.S. meat inspection system,
which allows U.S. inspectors to certify beef for export to Panama without
having each facility and shipment inspected by Panamanian authorities.
Peanuts. As the nation’s third largest exporter, Alabama peanut growers
will benefit from this agreement.
Panama will eliminate its 15-percent tariff on most peanut products
immediately.
The tariff on roasted peanuts will be eliminated in 5 years.
Back to the
U.S.–Panama Trade
Promotion Agreement
