# Presentation: 020360

## U.S.-ChileHorticultural Trade

## U.S.-Chile Free Trade Agreement

**  ****On June 6, 2003, The United States and Chile signed a Free Trade Agreement (FTA) that when fully implemented eliminates bilateral tariffs, lowers trade barriers, promotes economic integration, and expands opportunities.  The U.S. – Chile FTA entered into force on January 1, 2004. **
**  ****About three-quarters of U.S. and Chilean farm goods will be tariff free by 2007, with all tariffs and quotas phased out within 12 years. Farmers will gain duty-free treatment for pork and pork products, beef and beef products, soybeans and soybean meal, durum wheat, feed grains, potatoes, and processed food products such as french fries, pasta, distilled spirits, and breakfast cereals.**
**  ****Due to the sensitivity of the specialty crops, U.S. trade negotiators provided a 12-year non-linear tariff phase-out period.  Industry also received immediate zero tariffs for some crops, such as tree nuts and deciduous tree fruits.  **
**  ****SPS issues continue to be the biggest source of concern for the U.S. horticultural sector**

**U.S.-Chile Free Trade Agreement**

## Recent Successful Negotiations

**An ad hoc working group that was established during the FTA negotiations has been successful in resolving some of the SPS problems. **
**The successes include an apple and pear work plan, an agreement on California and Arizona citrus, and a near-agreement on stonefruit.**
**Immediate duty free treatment for U.S. apples, pears, peaches, cherries, grapes, lettuce, broccoli, almonds, pistachios, walnuts, oranges, and grapefruit.  **
**As a result of immediate duty-free treatment for certain products upon the agreement’s implementation, in 2004, U.S. almond exports (80212) were nearly $6 million, an increase of 270 percent compared to 2003; U.S. walnut exports increased 75 percent, to slightly over $1 million. **

**Notes:**
Overall Australia does not maintain many barriers to imports.  For the most part, tariffs on fresh horticultural items are low. However phytosanitary restrictions limit the entry of certain commodities.  Currently, the U.S. and Australia have a bilateral working group to find mutually acceptable methods to mitigate the risk associated with imported products.  Historically Australia had a zero risk philosophy regarding phytosanitary issues, but this appears to be under review and may move toward a policy that recognizes manageable risk.  The United States views the zero risk policy as being inconsistent with WTO requirements as having enabled Australia to avoid taking many meaningful steps toward resolution of outstanding issues. 

## U.S. Exports of Duty-Free Horticultural Products Under the U.S.-Chilean FTA

**U.S. Exports of Duty-Free Horticultural Products Under the ****U.S.-Chilean FTA**

**2004**

**Million**

**Source:  Bureau of the Census, DOC**

## U.S. Exports of Almonds Under the FTA Grew Substantially

**U.S. Exports of Almonds Under the FTA Grew Substantially**

**Calendar Years**

**Million**

**Source:  Bureau of the Census, DOC**

## U.S. Imports of Horticultural Products From Chile

**Calendar Years**

**Source:  Bureau of the Census, DOC**

**Billion **

## U.S. Horticultural Trade With Chile

**Source:  Bureau of the Census, DOC**

**Calendar Years**

**Billion $**

## Chilean Imports of Horticultural Products From the United States

**Chilean Imports of Horticultural Products From the United States**

**Calendar Years**

**Million**

**Source: Global Trade Atlas**