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News Release 10-109
Inv. No(s). 332-352
Contact: Peg O'Laughlin, 202-205-1819
Andean Trade Preference Act (ATPA) imports during 2009 continued to have a negligible overall effect on the U.S. economy and consumers, reports the U.S. International Trade Commission (USITC) in its study Andean Trade Preference Act: Impact on U.S. Industries and Consumers and on Drug Crop Eradication and Crop Substitution, Fourteenth Report, 2009.
ATPA continued to have a small but indirect effect in reducing illicit coca cultivation and promoting crop substitution efforts in the Andean countries in 2009, the agency reported.
The USITC, an independent, nonpartisan, factfinding federal agency, recently issued its 14th report in a series monitoring imports under ATPA and the impact of ATPA on drug crop eradication and crop substitution. The ATPA program affords preferential tariff treatment to most products of Colombia, Ecuador, and Peru.
Since the 13th report, two major changes have had an impact on the ATPA: Bolivia was suspended from ATPA eligibility as of December 15, 2008, and the U.S.-Peru Trade Promotion Agreement (TPA) entered into force on February 1, 2009. Peru retained its ATPA eligibility after the TPA entered into force.
Highlights of the report, which focuses on calendar year 2009, follow:
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The Andean countries collectively accounted for 1.3 percent of total U.S. imports in 2009. The value of duty-free imports that benefited exclusively from ATPA in 2009 accounted for about 0.5 percent of total U.S. imports. Hence, the overall impact of ATPA-exclusive imports on the U.S. economy was negligible in 2009.
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U.S. imports under the ATPA of fresh cut roses and fresh cut chrysanthemums showed the most significant impact on U.S. consumers through lower prices of ATPA imports (as a result of duty free treatment).
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The most significant impact of ATPA tariff preferences for U.S. producers occurred as a result of reduced domestic production in industries producing fresh cut chrysanthemums.
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The probable future effects of the ATPA are likely to continue to be minimal. U.S. and Andean government and private sector individuals reported that foreign and domestic investments in Colombia and Ecuador that could generate future exports to the United States under the ATPA were small in 2009, partly because the repeated expirations and short-term renewals of the ATPA discouraged ATPA-related investment. Also, with minor exceptions, investments in ATPA-eligible products in Peru are expected to generate future exports to the United States under the TPA, rather than the ATPA.
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The ATPA's effectiveness in reducing illicit coca cultivation and promoting crop substitution efforts in the Andean countries continued to be small and mostly indirect. According to the most recent U.S. government data, net land area under coca cultivation decreased substantially in Colombia but increased in Peru (and Bolivia). Alternative development programs in Colombia and Peru continued to provide the infrastructure and job creation needed to generate export sales of new or improved legal crops eligible for duty-free treatment under the ATPA.
Andean Trade Preference Act: Impact on U.S. Industries and Consumers and on Drug Crop Eradication and Crop Substitution, Fourteenth Report, 2009 (Inv. No. 332-352, USITC Publication No. 4188, September 2010) will be available on the USITC's Internet site at . The publication will also be available at federal depository libraries in the United States. A CD-ROM or printed copy of the report may be requested by emailing pubrequest@usitc.gov, calling 202-205-2000, or writing to the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW, Washington, DC 20436. Requests may also be faxed to 202-205-2104.
USITC general factfinding investigations, such as this one, cover matters related to tariffs or trade and are generally conducted at the request of the U.S. Trade Representative, the House Committee on Ways and Means, or the Senate Committee on Finance. The resulting reports convey the Commission's objective findings and independent analyses on the subjects investigated. The Commission makes no recommendations on policy or other matters in its general factfinding reports. Upon completion of each investigation, the USITC submits its findings and analyses to the requester. General factfinding investigation reports are subsequently released to the public unless they are classified by the requester for national security reasons.
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