Historic Free Trade Agreement with Chile Signed

Some 12 years after it was proposed and involving more than two years of complex trade negotiations, a ground-breaking free trade agreement (FTA) with Chile – the first comprehensive trade agreement between the U.S. and a South American country – was signed last Friday afternoon. 

“This agreement with Chile cuts tariffs and opens markets for U.S. beef and beef products,” says Eric Davis, an Idaho beef producer and president of the National Cattlemen’s Beef Association (NCBA).  “We have resolved outstanding animal health issues and the agreement provides equivalency in grading. For cattle producers, Chile is a prime candidate for increased export market opportunities. We are pleased the President has given the go-ahead.”

According to the office of the U.S. Trade Representative, when fully implemented the agreement eliminates bilateral tariffs, lowers trade barriers, promotes economic integration and expands opportunities for the peoples of both countries. U.S. Trade Representative Robert B. Zoellick signed on behalf of the United States, and Chilean Foreign Minister Soledad Alvear signed for Chile, at the Vizcaya Museum and Gardens in Miami.

The FTA will offer expanded export markets for U.S. farmers and ranchers. U.S. trade officials say that about three-quarters of both U.S. and Chilean farm goods will be tariff-free within four years, with all tariffs and quotas phased out within 12 years. U.S. farmers' access to Chilean markets will be as good or better than the European Union or Canada, both of which already have FTAs with Chile. Without this agreement, U.S. farmers face higher tariffs than farmers from Canada or the EU. Beef and beef products will gain duty-free treatment within four years.

“With this agreement, we’ll have preferential access to one of the world's fastest growing economies, open trade with no tariffs, and streamlined customs procedures,” says Michelle Reinke, manager of trade policy at NCBA. “Chile is not a large cattle-producing nation, and they import a majority of their beef and beef products – a prime candidate for marketing top quality U.S. products.”