FTA_Peru_US

FTA Perú – U.S.Carlos Lizarzaburu Hernández

The Peru-United States Free Trade Agreement (FTA or PFTA) is also known as the United States-Peru Trade Promotion Agreement (TPA).

Was signed on April 12, 2006 by President George W. Bush, and won Congressional approval on December 4, 2007.

On December 4, 1991, under the George H. W. Bush administration, the United States enacted the Andean Trade Preference Act (ATPA).

ATPA eliminated tariffs on a number of products from Peru, Bolivia, Colombia, and Ecuador. Its objective was the strengthening of legal industries in these countries as alternatives to drug production and trafficking.

History

The program was renewed on October 31, 2002 by the George W. Bush administration as the Andean Trade Promotion and Drug Eradication Act (ATPDEA), increasing from around 5,600 to some 6,300 products.

ATPDEA was set to expire on December 31, 2006 but was renewed by Congress for six months, up to June 30, 2007. A further extension was granted on June 28, 2007, this time for eight months, up to February 29, 2008.

History

On November 18, 2003, the U.S. Trade Representative notified Congress of the intention of the Bush administration to initiate negotiations for a FTA with the countries involved in ATPDEA.

Negotiations started without Bolivia in May 2004, however, as each of the three remaining Andean countries decided to pursue bilateral agreements with the United States.

History

After 13 rounds of negotiations, Peru and the United States concluded an agreement on December 7, 2005. Alfredo Ferrero, Peruvian Minister of Foreign Trade and Tourism, and the U.S. Trade Representative Rob Portman signed the deal on April 12, 2006 in Washington, D.C., in the presence of Peruvian President Alejandro Toledo.

History

After signed in April 2006, the FTA got bogged down of the Republican-controlled Congress.

On May 10, 2007, Democratic congressional leaders struck a deal with President Bush that secured their support for the FTA in exchange for inserting provisions that protected workers' rights to organize and bargain collectively, and guaranteed that both countries would abide by intl. environmental treaties.

History

The Peruvian government would also have to agree to the changes before Congress could consider the agreement.

On June 25, 2007 Peru and the U. S. reached an agreement regarding amendments to the United States-Peru FTA in compliance with the May 10 agreement between the Bush administration and Democratic congressional leaders.

History

The new version of the bill, which still required congressional approval to be ratified, included changes to the FTA's provisions on labor and the environment.

The Congress of Peru debated the new agreement for six hours during the night of June 27, 2006 and ratified it in the early hours of the next day. The vote was 79–14, with seven abstentions.

History

On June 29, U.S. indicated that the FTA would not be taken up for consideration, contrary to the urging of the president and business groups. The congressional leaders stated that Peru would have to change its domestic laws to comply with the May 10 agreement.

History

On September 21, 2007, the Senate Finance Committee approved the Peru-US FTA in a vote of 18-3. Finance Committee Chairman, Max Baucus, attributed the passage to the inclusion of strong environmental and labor standards. The agreement would make 80 % of American exports of consumer and industrial products, and two-thirds of farm exports, duty free.

History

While the bill is expected to get congressional approval, some environmental and labor groups still oppose the bill, questioning if the new labor standards would be enforced.

On November 8, 2007, the House approved the FTA, sending the measure to the full Senate for consideration. Even after requiring concessions from Peru, Democratic leaders faced dissent, and labor groups continued to speak out against the bill.

History

On December 4, 2007, the Senate passed the trade agreement. Democratic supporters said that the deal opened up markets for American exports.

History

The FTA was implemented on February 1, 2009.

History

To guarantee permanent preferential access of Peruvian exports to the world's largest economy.

What does Perú search?

To increase and diversify exports, eliminating distortions caused by tariffs, import quotas, subsidies and non-tariff barriers (taking into account the level of competitiveness of the country for the definition of tariff reduction periods).

To attract private flows and foreign investment, promoting the development of economies of scale, a greater degree of economic specialization and greater efficiency in the allocation of production factors.


Contributes to improve quality of life of people through consumer access to cheaper and higher quality and variety, the expansion of employment opportunities, the increase in real wages in the export sector.


Establish clear and permanent rules for trade in goods and services and investments that strengthen the institutional framework, competitiveness and best business practices in the country.


Create mechanisms to defend Peruvian commercial interests in the United States and defines clear, transparent and effective mechanisms to resolving potential commercial conflicts that may arise.


It strengthens the stability of economic policy and institutions, as well as improved Peruvian risk classification, which helps lower the credit cost and strengthen the capital market stability.


Reduce the vulnerability of the economy to external financial shocks and increases the stability of our macroeconomic indicators, closing links with the trends of one of the world's most stable economies.


New Market Access for U.S. Consumer and Industrial Products: Eighty percent of U.S.

exports of consumer and industrial products to Peru will become duty-free immediately

What does U.S. search?

New Opportunities for U.S. Farmers and Ranchers: Tariffs on most U.S. farm products will be

phased out within 15 years (many immediately or within 5 years), with all tariffs eliminated in 17 years

Both countries resolved a number of significant sanitary and phytosanitary and technical standards issues that had impeded U.S. exports of beef, pork, poultry, and rice


Textiles and Apparel: Textiles and apparel will be duty-free and

quota-free immediately if the products meet the Agreement’s rule of origin, promoting new opportunities for U.S. and Peruvian fiber, yarn, fabric and apparel manufacturing.



Strong Protections for U.S. Investors: The Agreement establishes a secure,

predictable legal framework for U.S. investors operating in Peru. All forms of investment are protected under the Agreement. U.S. investors will enjoy in almost all circumstances the right to establish, acquire and operate investments in Peru on an equal footing with local investors.


Expanded Access to Services Markets: Peru will accord substantial market access

across its entire services regime including financial services. Peru has agreed to eliminate measures that require U.S. firms to hire national rather than U.S. professionals and measures requiring the purchase of local goods. Peru also agreed that both mutual funds and pension funds in Peru will be allowed to use portfolio managers in the U.S.


Greater Protection for Intellectual Property Rights: Improvements include state-of-the-art

protections for digital products such as U.S. software, music, text, and video; stronger protection for U.S. patents, trademarks and test data, including an electronic system for the registration and maintenance of trademarks; and further deterrence of piracy and counterfeiting of criminalizing end-user piracy.



The Digital Age: Both parties have agreed not to impose

customs duties on digital products and to cooperate in numerous policy areas related to e-commerce. Additionally, the Agreement requires a system to resolve disputes about trademarks used in Internet domain names. Furthermore, the Agreement applies the principle of “first-in-time, first-in-right” to trademarks and geographical indications.


Internationally-recognized Labor Rights: The Agreement includes an obligation for the

countries to adopt and maintain the principles concerning the fundamental labor rights as stated in the 1998 ILO Declaration on Fundamental Principles and Rights at Work, including a prohibition of child labor.

The Agreement also establishes a Cooperative Mechanism for develop cooperative activities aimed at promoting and advancing fundamental labor rights.


Commitments and Cooperation to Protect the Environment: The Agreement commits parties to enforce their own

domestic environmental laws and adopt laws to fulfill obligations under the seven covered multilateral environmental agreements (MEAs).

The Environment Chapter includes an Annex on Forest Sector Governance, addressing the environmental and economic consequences of trade associated with illegal logging and illegal trade in wildlife.


Trade Capacity-Building: Development and Trade Together: The Agreement creates a Trade Capacity Building

Committee, which will help Peru build its capacity to benefit more broadly from the opportunities it creates.

Assistance programs include programs for small and medium-sized enterprises and farmers, and programs for infrastructure. U.S. provided a total of approximately $58 million in TCB assistance (2004 – 2006).


Fair and Open Government Procurement: U.S. suppliers are granted non-discriminatory

rights to bid on contract from a broad range of Peruvian government ministries, agencies, public enterprises, and regional governments.

The Agreement requires the use of fair and transparent procurement procedures, such as advance notice of purchase and timely and effective bid review procedures.


An Open and Competitive Telecommunications Market: Users of the telecom network

are guaranteed reasonable and non-discriminatory access to the network. This prevents local firms from having preferential or “first right” of access to telecom networks.


Increased Transparency: The Agreement’s dispute settlement mechanisms

provide for open public hearings, public access to documents, and the opportunity for third parties to submit views.

For customs procedures, Peru commits to publish laws and regulations on the Internet, and will ensure procedural certainty and fairness. Peru also committed to make public its response to significant comments received on proposed technical regulations.


Dispute Settlement: Core obligations,

including labor and environment provisions, are subject to the dispute settlement mechanism of the Agreement.


Response from environmental groups: Environmental provisions marked a step forward.

The FTA now includes provisions that could help stop the flow of logged timber from Peru. In addition, there are requirements for countries to fulfill their obligations under Multilateral Environmental Agreements.

The groups warned, however, against using the Peru FTA as a template for future trade deals since problematic provisions in the investment chapter have not been improved.

Support, opposition and critiques

Press release by the U.S. Trade Representative: "A predictable legal framework for U.S.

investors." "Enforcement of labor and environmental

laws." "Protection of intellectual property." "An effective system to settle disputes." "A strengthening of Peru’s "ability to effectively

counter narco-terrorism."


Presbyterian Church (USA): Peru is engaged in a delicate reconciliation process after

decades of armed conflict and the country remains burdened by high levels of poverty. The U.S. Trade Representative is claiming the trade pact will lead to increased democratic stability in the region and curbed cultivation of coca and trafficking of cocaine.

Some of the major problems in NAFTA’s model are replicated in the Peru FTA. This model is a “one-size-fits-all” approach to economic development for poor nations that does not live up to the principles of fair trade. The US-Peru FTA will cause lost livelihoods in rural communities, reduced access to life-saving medicines and perpetuate the global “race to the bottom” for workers and environmental protections.


Environmental criticism A number of environmental and social justice

organizations came out against the Peru-U.S. FTA, citing that it did not do enough to protect the unique and irreplaceable peruvian environment. They found the original measure to lack adequate environmental safeguards, to too easily allow for harmful anti-environment lawsuits, and to present a threat to biodiversity.


For Perú: Consolidate and extend the preferences under

ATPDEA. Attract foreign investment. Generate employment. Enhance the country's competitiveness in the

region. Increase the workers' income. Curb poverty levels. Create and export sugar cane ethanol.

Potential Benefits

For EEUU: Improve access to goods and services. Strengthen its investments. Promote security and democracy. Fight against drug trafficking.

Potential Benefits

Intellectual property: Patent protection.

No discrimination against foreign investors. Elimination of export subsidies. Schedule for tariff reduction. Application of farming safeguard measures. Technical cooperation and assistance programs. Effective enforcement of environmental

legislation.

Sensitive Topics

Intellectual property (cont.): Sovereignty to adopt and modify

environmental legislation. Mechanisms for environmental cooperation.

Sensitive Topics

Labor: Rigorous enforcement of national legislation Fundamental International Labor

Organization treaties Sovereignty to modify legislation Mechanisms for cooperation

Sensitive Topics

Environment/Animal Welfare: Habitat Loss Due to Expansion of Mining

Development. Increased U.S. pork and poultry exports

funding factory farming. Legislation to protect animals could be seen as

trade barrier.

Sensitive Topics

Results

Results

Results

Results

Results

http://www.andina.com.pe/espanol/noticia-peruus-trade-doubles-since-fta-447147.aspx

http://gestion.pe/economia/comercio-entre-peru-y-eeuu-crecio-105-desde-vigencia-tlc-2058892

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FTA_Peru_US

Documents

united statesperu fta

congress of peru

peruus fta

new agreement

theandean trade promotion

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