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Trade Agreements are Good for South Dakota

By Senator John Thune

August 5, 2011

The U.S. Department of Labor recently announced that the national unemployment rate for July was 9.1 percent. After 30 consecutive months of unemployment at or above 8 percent, it is clear that the policies coming from Washington are damaging employers' ability to create jobs for the nearly 14 million Americans currently unemployed.

One of the most obvious ways to create more employment opportunities and spur the private sector would be to pass the long-delayed, job-creating free trade agreements which were signed more than four years ago. The Colombia, Panama, and South Korea trade agreements are ready to be taken up by Congress, but President Obama has yet to officially submit them for consideration.

Delaying the passage of these trade agreements is not only hurting job creation, it is causing our producers and manufacturers to lose out on opportunities in the global market. Specifically, the delay in passing the Colombia trade agreement is having a negative impact on America's agricultural producers, including those in our state. U.S. farm exports to Colombia have decreased from $1.7 billion in 2008 to $832 million as of 2010 as Colombia's trade agreements with other nations have gone into effect. Consider the export of U.S. corn, wheat and soybean, three of the major crops in South Dakota. The combined market share in Colombia for these three U.S. agricultural exports has decreased from 81 percent in 2008 to 19 percent as of 2010, a staggering decline of 62 percentage points.

A similar story is likely to happen in Korea, the world's 13th largest economy, if we continue to delay action on the Korea trade agreement. Korea's tariffs on imported agricultural goods currently average 54 percent, compared to an average 9 percent tariff on these imports in America. Passage of the Korea agreement will help to level the playing field. Korea's trade agreement with the European Union went into effect on July 1st of this year. According to press reports, European exports to Korea rose 16 percent in the first 13 days after the Korea-European Union trade agreement took effect. These are export opportunities that should be going to producers in South Dakota and throughout the nation.

While the president continues to hold these already negotiated trade agreements hostage, Congressional leaders have agreed on a path forward once the agreements are sent to Capitol Hill. South Dakota farmers and manufacturers have waited long enough. The time is long overdue for the president to finally submit these job-creating free trade agreements to Congress.