trade in mediterranean products: the effects of united states regional and bilateral trade...

Trade in Mediterranean Products: The Effects of United StatesRegional and Bilateral Trade Agreements

Cal Med Consortium WorkshopMediterranean Products in the WTO Trade Negotiations and Trade

Disputes and in Regional Trade Agreements

Fumiko Yamazaki & Mechel S. Paggi*

Montpellier, France26, June, 2006

•Fumiko Yamazaki, Senior Research Economist and Mechel S. Paggi, Director Center for Agricultural Business, California State University, Fresno

•Overview of U.S. Regional and Bi-Lateral Trade Agreements•Time Horizons and Why (Perhaps?)•Process for Selecting FTA Candidates

Part 1

Australia ‘04

Bahrain ‘04CAFTA-DR ‘04

Chile ‘04

FTAA ‘?

Morocco ‘04

Southern African Customs Union ‘05

Singapore ‘03

Jordan ‘03

U.S. Regional and Bilateral Trade Agreements

NAFTA ‘94Israel ‘85

CUSTA, ‘89

Peru FTA ’05, Columbia, Bolivia, Ecuador: Andean Trade Promotion Agreement

Panama ‘05

Thailand ‘05

•“Competitive Liberalization” 2001•Doha Drags On

•TPA Expiration 2007

Fast Track Lapses

Trade Agreements Approved under Fast Track

Tokyo Round GATT Agreements—1979

U.S.-Israel FTA—1985

U.S.-Canada FTA—1988

North American Free Trade Agreements—1993

Uruguay Round WTO Agreements—1994

Trade Agreements in the Interim Period

Jordan FTA - 2000

Trade Agreements Initiated Under Trade Promotion Authority

Australia FTA

Chile FTA

Bahrain FTA

Andean Trade Promotion: Peru, Columbia, Ecuador, Bolivia

CAFTA- DR: Costa Rica, Guatemala, Honduras, Nicaragua El Salvador & Dominican Republic

Malaysia FTA

Morocco FTA

Oman FTA

Panama FTA

Republic of Korea FTA

Singapore FTA *

Thailand FTA

United Arab Emirates FTA

Southern African Customs Union FTA: Botswana, Lesotho, Namibia, South Africa & Swaziland

FTAA ?

14 Agreements26 Countries

Agriculture 1 Voice in the Room, Similar General Trade Policy Discussions

• Country readiness. Country readiness involves the country’s politicalwill, trade capabilities, and rule of law systems.

• Economic/Commercial benefit. The interagency group reviews the likely economic benefit to the United States.

• Benefits to the broader trade liberalization strategy. This factor relates to the prospective FTA partner’s overall support for U.S. trade goals.

• Compatibility with U.S. interests. A potential FTA partner is examinedfor its compatibility with broad U.S. interests, including its support forU.S. foreign policy positions.

• Congressional/Private-sector support. the extentto which a particular FTA selection has garnered support from theCongress, business groups, and civil society.

• U.S. government resource constraints. This factor focuses primarily onconstraints at USTR—what regional office is available to lead thenegotiation, what staff are available, etc.

Six Selection Criteria Guides for a Potential FTA Partner

Keeping Up With the Jones's : Trade Preference Parity*

Chile

* See CAFTA Report for Detail Analysis of Effects

Part 2

• Basics of Mediterranean Products Trade

•U.S. Trade in Mediterranean Products & Links to FTAs

Trade by FTA CategoryCountry Specific TradeProduct Mix & Suppliers

Figure 1 World Imports of Mediterranean Products by Major Countries: 2004

Belgium4%

ROW30%

Russian Federation2%

Canada4%

Japan5%

Netherlands5%

Italy6%

France6%

Germany12%

United Kingdom12%

USA14%

Figure 2 World Exports of Mediterranean Products by Major Countries: 2004

Mexico2%

Germany2%

Belgium2%

South Africa2%

Netherlands4%

Turkey4%

USA9%

France13%

Italy14%

Spain18%ROW

30%

U.S Trade Agreement Negotiation Status Categories

FTA-E Agreement is Already Implemented Israel, NAFTA, Jordon, Singapore, Australia, Chile Morocco and CAFTA-DR (El Salvador, Honduras and Nicaragua)

FTA-S Negotiations Completed Bahrain, Oman, Columbia, Peru, CAFTA-DR (Costa Rica Dominican Republic and Guatemala)

FTA-N Negotiations are underway FTAA Countries nes, SACU Countries, Ecuador, Thailand UAE, Republic of Korea, Panama and Malaysia

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

Million $

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Figure 3 U.S. Imports of Mediterranean Products from U.S. FTAs by Categories: 1995 - 2005

FTA-S Other FTA-N FTAA-N Other FTA-E NAFTA-E ROW

0

1000

2000

3000

4000

5000

6000

7000

Million $

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Figure 4 U.S. Exports of Mediterranean Products to U.S. FTAs by Categories: 1995 - 2005

FTA-S FTAA-N Other FTA-E Other FTA-N NAFTA-E ROW

Figure 5 U.S. Imports of Mediterranean Products from Major FTAs Categories: 2005

ROW54%

FTA-S1%

FTAA-N5% Other FTA-N

2%

Other FTA-E19%

NAFTA-E19%

Figure 6 U.S. Exports of Mediterranean Products to Major FTAs Categories: 2005

FTA-S1%

FTAA-N1%

Other FTA-E3%

Other FTA-N7%

ROW58%

NAFTA-E30%

Country Specific Trade

Figure 7 Trend in U.S. Imports of Mediterranean Products from Major Countries in FTAs: 1995 - 2005

0

200

400

600

800

1000

1200

1400

1600

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Mil

lion

$

South Africa Argentina Brazil Canada Australia Chile Mexico

Figure 8 Trend in U.S. Exports of Mediterranean Products to Major Countries in FTAs: 1995 - 2005

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Mil

lion

$

Canada Mexico Korea South Australia Malaysia

Figure 9 U.S. Imports of Mediterranean Products from Major Countries: 2005

India3%

ROW6%

Greece1%

Argentina2%

Vietnam2%

Turkey1%

China2%

Brazil3%

South Africa1% Germany

1%

Canada4%

Spain7%

Australia8%

Chile10%

Mexico15%

Italy17%

France17%

Figure 10 U.S. Exports of Mediterranean Products to Major Countries: 2005

China2%

Taiwan2%

India2%

Australia2%

Malaysia1%

France3%

Belgium3%

Korea South4%

Hong Kong3%

Italy4%

Mexico4% Netherlands

5% United Kingdom5%

ROW14%

Spain5%

Germany6%

Japan11%

Canada27%

Product Specific Trade

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10.00

Billion $

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Figure 11 U.S. Imports of Major Mediterranean Products from World: 1995 - 2005

Others

Citrus Fruit, Prep, Nesoi

Fruit Nesoi & Nuts,Frozen

Orange Juice, Frozen

Nuts Nesoi

Olive Oil, Refined

Olives Prep/Pres

Cashew Nuts, Shelled

Olive Oil,Virgin

Sparkling Wine

Grape Brandy

Grapes, Fresh

Tomatoes, Fresh

Wine

Figure 12 U.S. Imports of Major Mediterranean Products from World:2005

Nuts Nesoi3%

Orange Juice, Frozen2%

Olives Prep/Pres3%

Olive Oil, Refined3%

Fruit Nesoi & Nuts,Frozen2%

Citrus Fruit, Prep, Nesoi2%

Others11%

Cashew Nuts, Shelled5%

Olive Oil,Virgin6%

Sparkling Wine6% Grape Brandy

6% Grapes, Fresh9%

Tomatoes, Fresh11%

Wine31%

Commodity/Country Specific Trade

Imports

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Million $

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Figure 13 U.S. Imports of Wine (HS 220421) from Major Countries: 1995 - 2005

Italy Australia France Chile Spain ROW

Figure 14 U.S. Imports of Major Mediterranean Products from Australia: 1995 - 2005

0.00

100.00

200.00

300.00

400.00

500.00

600.00

700.00

800.00

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Mil

lion

$

Wine, Fr Grape Nesoi & Gr Must W Alc, Nov 2 Liters

Oranges, Fresh

Nuts Nesoi, Fresh Or Dried, Shelled Or Not

Wine, Fr Grape Nesoi & Gr Must With Alc, Nesoi

Mandarins (Inc Tanger Etc) & Citrus Hybr Fr Or Dri

Sparkling Wine Of Fresh Grapes

Olive Oil/Fractions, Virgin, Not Chem Modified

Tomatoes Whole/Pieces Prep/Pres Ex Vinegar Etc

Cherries, Sweet Or Tart, Fresh

Cherries, Prepared Or Preserved, Nesoi

Olives, Provisionally Preserved, Inedible

Nuts (Exc Peanuts) And Seeds, Prepared Etc. Nesoi

Lemons And Limes, Fresh Or Dried

Figure 15 U.S. Imports of Major Mediterranean Products from Chile: 1995 - 2005

0.00

100.00

200.00

300.00

400.00

500.00

600.00

700.00

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Mil

lion

$

Grapes, Fresh


Peaches, Including Nectarines, Fresh

Plums, Prune Plums And Sloes, Fresh


Grapes, Dried (Including Raisins)


Mandarins (Inc Tanger Etc) & Citrus Hybr Fr Or Dri

Grape Juice, Nesoi,Nt Fortified With Vitamins/Min

Fruit Nesoi & Nuts, Sweetened Etc Or Not, Frozen

Peaches, Prepared Or Preserved, Nesoi

Prunes, Dried

Apricots, Fresh

0

200

400

600

800

1000

1200

Million $

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Figure 16 U.S. Imports of Fresh Tomatoes (HS 070200) from Major Countries: 1995 - 2005

Mexico Canada ROW

Figure 17 U.S. Imports of Major Mediterranean Products from Mexico: 1995 - 2005

0.00

100.00

200.00

300.00

400.00

500.00

600.00

700.00

800.00

900.00

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Mil

lion

$

Tomatoes, Fresh Or Chilled

Grapes, Fresh



Orange Juice, Frozen, Sweetened Or Not

Citrus Fruit (Including Mixtures), Prep Etc Nesoi

Juice Of 1 Citrus Fruit, Brix Value <=20, Nt Fortf


Grape Brandy

Grapefruit Juice,Brix Value <=20,Nt Fort W Vitamin

Oranges, Fresh


Orange Juice, Not Frozen,Of A Brix Value Not Ov 20

0

100

200

300

400

500

600

700

800

900

1,000

Million $

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Figure 18 U.S. Imports of Fresh Grapes (HS 080610) from Major Countries: 1995 - 2005

Chile Mexico ROW

Commodity/Country Specific Trade

Exports

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

Billion $

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Figure 19 U.S. Exports of Major Mediterranean Products to World: 1995 - 2005

Others

Grapefruit

Orange Juice, Not Frozen

Walnuts,Shelled

Grapes, Dried

Nuts (Exc Peanuts), Prepared. Nesoi

Cherries,Fresh

Tomatoes, Fresh

Pistachios

Almonds,In Shell

Oranges, Fresh

Wine

Grapes, Fresh

Almonds,Shelled

Figure 20 U.S. Exports of Major Mediterranean Products to World: 2005

Grapes, Dried3%

Walnuts,Shelled3%

Orange Juice, Not Frozen3%

Nuts (Exc Peanuts), Prepared. Nesoi

3%Tomatoes, Fresh

3%

Cherries,Fresh3%

Grapefruit2%

Others23%

Pistachios4%

Almonds,In Shell5%

Oranges, Fresh6%

Wine8%

Grapes, Fresh11%

Almonds,Shelled23%

0

200

400

600

800

1,000

1,200

1,400

1,600

Million $

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Figure 21 U.S. Exports of Shelled Almonds (HS 080212) to Major Countries: 1995 - 2005

Spain Germany Japan Canada Italy Netherlands France Belgium United Arab Emirates Greece United Kingdom India Korea South ROW

0

100

200

300

400

500

600

700

Million $

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Figure 22 U.S. Exports of Fresh Grapes (HS 080610) to Major Countries: 1995 - 2005

Canada Mexico Malaysia China Hong Kong Taiwan Australia ROW

Figure 23 U.S. Exports of Major Mediterranean Products to NAFTA: 1995 - 2005

0.00

50.00

100.00

150.00

200.00

250.00

300.00

350.00

400.00

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Mil

lion

$

Grapes, Fresh

Tomatoes, Fresh Or Chilled

Orange Juice, Not Frozen,Of A Brix Value Not Ov 20


Almonds, Fresh Or Dried, Shelled

Oranges, Fresh


Peaches, Including Nectarines, Fresh




Tomato Paste Etc, Not Prepared With Vinegar Etc.

Plums, Prune Plums And Sloes, Fresh

0

100

200

300

400

500

600

700

Million $

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Figure 24 U.S. Exports of Wine (HS 220421) to Major Countries: 1995 - 2005

ROW

Korea South

France

Switzerland

Denmark

Sweden

Germany

Netherlands

Japan

Canada

United Kingdom

0

50

100

150

200

250

300

350

400

Million $

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Figure 25 U.S. Exports of Fresh Oranges (HS 080510) to Major Countries: 1995 - 2005

ROW

Taiwan

Mexico

Singapore

Australia

Malaysia

China

Hong Kong

Japan

Korea South

Canada

Figure 26 U.S. Exports of Major Mediterranean Products to Korea: 1995 - 2005

0.00

20.00

40.00

60.00

80.00

100.00

120.00

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Mil

lion

$

Oranges, Fresh


Walnuts, Fresh Or Dried, Shelled


Grapefruit, Fresh Or Dried








Grapes, Fresh

Figure 27 U.S. Exports of Major Mediterranean Products to Japan: 1995 - 2005

0.00

20.00

40.00

60.00

80.00

100.00

120.00

140.00

160.00

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Mil

lion

$



Grapefruit, Fresh Or Dried

Oranges, Fresh


Walnuts, Fresh Or Dried, Shelled


Prunes, Dried



Almonds, Fresh Or Dried, In Shell


Grapefruit Juice,Nesoi,Nt Fortorified W Vitamins

0

1

2

3

4

5

6

7

8

Number

1985 .. 1989 .. 1994 .. 1998 .. 2001 2002 2003 2004 2005 2006

Year

Figure 28 Number of U.S. FTAs by Year: 1985 - 2006

Figure 29 U.S. Exports of Mediterranean Products to Major Countries: 1995 - 2005

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Mil

lion

$

Canada

Japan

Germany

Spain

United Kingdom

Netherlands

Mexico

Italy

Korea South

Hong Kong

France

Belgium

China

Taiwan

India

Australia

Malaysia

Figure 30 U.S. Imports of Mediterranean Products from Major Countries: 1995 - 2005

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Year

Mil

lion

$

France

Italy

Mexico

Chile

Australia

Spain

Canada

Brazil

India

China

Argentina

Vietnam

Turkey

South Africa

Germany

Greece

0

20

40

60

80

100

120

140

Million $

2000 2001 2002 2003 2004 2005

Year

Figure 31 Korean Imports of Oranges, Fresh (HS 080510) from Major Countries: 2000 - 2005

USA South Africa Australia China Chile New Zealand ROW

0

5

10

15

20

25

Million $

2000 2001 2002 2003 2004 2005

Year

Figure 32 Korean Imports of Grapes, Fresh (HS 080610) from Major Countries: 2000 - 2005

Chile USA ROW

Part 3

• What Did We Learn?

• What Does it Suggest?

• Where Might We Go Next?

• What Did We Learn?

The US flurry of Activity of Late Due to Strategic Initiative, Sense of Urgency related to Expiration of TPA

and Concern Over Progress in Multilateral Negotiations

Existing FTAs Largest Contributor to Mediterranean Product Trade, but Non-FTA Countries are Major Contributors to Imports and Dominate in Exports

Limited Product Mix from Limited Number of Individual Country Suppliers

Potential Role of New FTA Participants Somewhat Limited

• What Does it Suggest?

Regional and Bilateral Agreements Provide Some Advantages

Preferential Tariffs Enhance Market Access Tariff Parity with Competitors

Often Considerations Exists Beyond Agriculture

Not a Substitute for WTO (export subsidies, domestic subsidies)

For the US Create Market Access With Little Additional Costs (CAFTA-DR Example)

Ability to Craft Specifics to Deal With Sensitive Product Problems (US-Australia and the Phantom Sugar)

• Where Might We Go Next?

•Where Might We Go Next?

Modeling Efforts for Quantitative Estimates, Welfare Analysis, etc.

Issues Related to Trade Diversion vs. Trade Creation

Potential for Agreements Between Major Players (Japan, EU, ?)

Mediterranean Product Specific Focus on Other IssuesRole of GI’s , Phytosanitary Barriers, Trade Disputes

So Don’t Miss the Other Presentations

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