USA Rice Weighs In with “Performance Review” of U.S. Trade Agreements

WASHINGTON, DC – “Well negotiated and enforced trade agreements lead to increased rice exports.”  That’s the simple and key message from comments submitted today by USA Rice to the U.S. Trade Representative’s office (USTR).  

The comments are in response to President Trump’s Executive Order requiring several government agencies to conduct comprehensive performance reviews on existing bilateral and multilateral trade agreements entered into by the United States.  These performance reviews will be the basis of a subsequent report to the president.

“If you look at the 15 largest export markets for U.S. rice last year, 65 percent of those sales were to markets where the United States has a trade agreement or access because of our membership in the World Trade Organization (WTO),” said USA Rice COO Bob Cummings.  “When looking at total U.S. rice exports, 57 percent go to markets where we have trade agreements.”

The comments layout what many in the rice industry already know – NAFTA is responsible for Mexico being the number one market for U.S. rice, with sales last year of 863,000 MT or 22 percent of all exports.  The U.S.-Colombia trade agreement opened a completely new market and established a long-term stream of funding for domestic rice research.  Taken together, U.S. rice exports to Japan, Korea, and Taiwan were 568,000 MT in 2016, and rice, along with other agricultural products, is one of the bright spots in our trade relations with these markets.  These markets would not exist today if not for the WTO.

“We also reminded the administration of what makes a ‘good’ trade agreement,” continued Cummings.  “From our decades of experience, a good trade agreement at a minimum must be comprehensive and with no product exclusions; provide for free trade in rice over the shortest period possible; contain meaningful and rising access through tariff rate quotas in exchange for any duty phase-outs and; provide a transparent and simple TRQ mechanism to maximize commercial opportunities for quota fill.”

The comments noted that rigorous enforcement goes hand-in-hand with trade agreements, citing U.S. successes in the WTO on past cases against Mexico and Turkey, and our objectives in the U.S.’s current case against China over the level of China’s domestic subsidies for wheat, corn, and rice.  

“It’s hard to underestimate the value of the WTO’s dispute settlement provisions, if for no other reason than it is the only game in town to hold countries to their international obligations,” concluded Cummings.