Picture this: nearly 500 million people -- more than four times the number of people who watched the Super Bowl last year. That’s the equivalent of every man, woman and child living in the 11 other countries that make up the Trans-Pacific Partnership, or TPP, and they’re all hungry for the American brand of agriculture. These half-billion potential shoppers can’t get enough of what American agriculture is dishing up, and their needs aren’t currently being met.
The Obama administration’s team of negotiators has taken America’s farmers one step closer to fully tapping into that market with the finalization of the TPP agreement. The next step is for Congress to do the right thing for America’s farmers and send the deal to President Barack Obama’s desk.
Why is the agreement a good deal for American agriculture?
TPP positions the United States and American agriculture as a leader. With this deal, American agricultural products have the opportunity to set the standard for excellence and build a loyal customer base in a region where demand for rural-grown and rural-made products is projected to grow substantially in the next 15 years.
As with any negotiation, the final TPP agreement reflects compromise on all sides, but we believe our negotiators got the best possible deal for American agriculture. Despite current taxes on our products overseas, U.S. agricultural exports totaled more than $13 billion to Japan, $2.3 billion to Vietnam, and just under $1 billion to Malaysia in 2014. Overall, TPP countries purchased 42 percent of all U.S. agricultural exports, totaling $63 billion, despite the disadvantage we currently face.
The TPP agreement balances meeting the diverse marketing needs of American farmers and ranchers right now with the market access we’ll need to cater to the tastes of consumers in TPP countries -- the Asia-Pacific region holds the world’s fastest growing middle-class populations -- 10 or more years from now. By 2030, the Asia-Pacific region will represent 66 percent of the world’s middle class and will be looking for even more high-quality products that the United States excels at producing, like meat, dairy, fruits and vegetables. No one is better positioned to meet that growing demand than the most productive farmers in the world and, with the TPP agreement, we have a business plan that helps get that abundance into the hands of consumers.
Without new trade deals like TPP, the growth in agricultural exports -- and the jobs supported by them -- enjoyed in years past may be at risk. TPP levels the playing field for farmers, ranchers and manufacturers -- many of them in rural areas -- by eliminating more than 18,000 unfair taxes that various TPP countries put on American products and further expands our exports to the region.
For example, Japan’s beef tariff, which could be as high as 50 percent, will be reduced to 9 percent. Vietnam will eliminate tariffs on beef and Malaysia will lock tariffs in at zero percent. For pork, Japan will eliminate duties on nearly 80 percent of product categories. Japan, which excluded rice from its prior trade agreements, will establish a new, duty-free quota for U.S. rice, while Malaysia and Vietnam will eliminate tariffs on rice. Japan, Malaysia and Vietnam will eliminate tariffs on all fresh and processed fruits, including citrus. And Malaysia and Vietnam will immediately eliminate all tariffs, and Japan nearly all tariffs, on fresh and processed vegetables.
Failing to implement TPP means American products would fall behind our competitors, as other countries are now aggressively negotiating their own deals in the region that would leave us out.
TPP sets the rules of the road on labor and human rights, the environment, and intellectual property for trade with Asia. If we don’t write those rules, our competitors will set weaker standards, threatening American jobs and workers while undermining U.S. leadership in Asia. China is already there, aggressively negotiating a competing agreement with other Asian nations. The issue isn’t if new rules will be set – it’s who is going to win the race to set them.
Perhaps most importantly, the TPP agreement reflects America’s values. For most Americans, this is about more than dollars and diplomacy -- it’s about keeping a good-paying job and preserving their communities. Exports and the jobs that come with them make that possible.
TPP will benefit more than just the segment of the American population directly involved in producing food. It will have a ripple effect all across rural America. Exports today directly support more than 1 million American jobs, and increased exports under TPP will support more good-paying jobs. Expanded export opportunities also benefit the packers, processors, shippers and others employed at every step in the production chain.
Expanded U.S. trade overall has added roughly $13,000, on average, to every American family’s income. Higher commodity prices, additional farm income, and agribusiness jobs driven by TPP will generate more cash flow in rural economies, supporting local businesses on main street. In parts of rural America, these jobs are critical to preserving our small towns and rural way of life.
Rural America needs the good deal laid out in the TPP agreement. The U.S. Department of Agriculture remains committed to working closely with Congress to obtain support for this historic deal so that our businesses can sell more rural-grown and rural-made goods around the world, and we can help more American workers compete and win.
By Tom Vilsack
Tom Vilsack is the U.S. secretary of agriculture. He wrote this for The Philadelphia Inquirer. -- Ed.
