Vilsack: U.S. Will Not Demand More On Beef Before Sending Up Korea FTA

Via Inside U.S. Trade

Agriculture Secretary Tom Vilsack this week made clear that the Obama administration will not demand that South Korea provide further concessions on market access for U.S. beef exports as a precondition for submitting the U.S.-Korea free trade agreement to the U.S. Congress for a vote.

“I think it is going to be a little bit difficult to do that under the circumstances,” Vilsack told reporters on March 8, when asked if the administration was seeking additional beef concessions before the FTA faces a vote in the Senate. Finance Committee Chairman Max Baucus (D-MT) has said he will vote against the FTA absent more progress on beef.

Vilsack argued that the United States should focus on passing the Korea FTA, as doing so will lower the tariffs faced by U.S. beef exporters. The more that South Korean consumers are exposed to U.S. beef, the more they will accept it and demand it, which will make it easier to further open the Korean beef market in the future, he said.

“The focus here has to be on quick [FTA] ratification, so that we can start receiving the benefits of this, and then as we do, we gain market share, we gain greater consumer acceptance and confidence. It’s just going to lead to more opportunities,” he said.

“We … are anxious to promote as much trade within the framework as possible so that we increase the comfort level of Korean consumers and get them to acquire a very solid taste and desire for American beef,” he added.

When asked about Baucus’ demands on beef, Vilsack stressed the overall value of the Korea FTA for U.S. agricultural exporters. Baucus has said he is not demanding immediate, full opening of the Korean beef market as a condition for supporting the Korea FTA, but wants some marginal progress on market access.

Currently, market access is limited to beef from cattle 30 months or younger. South Korea has completely refused to engage on the issue and has ruled out additional talks on beef related to the bilateral trade deal.

“I think what we need to be doing is making sure that Chairman Baucus and other members of the committee are fully aware of the expanded opportunity this represents for American agriculture in a variety products, including beef,” the agriculture secretary said. The FTA would eliminate the 40 percent tariff on U.S. beef over 15 years.

There will always be “ongoing communication” with the Koreans about beef, Vilsack added. When asked if U.S. officials have held specific conversations on increased beef access with their South Korean counterparts since last December, when the two sides agreed to additional concessions, Vilsack declined to answer directly.

Instead, he said the United States and South Korea have focused over the last several months on making sure the terms of the bilateral agreement are understood and properly translated.

The United States continues to advocate for full market access for U.S. beef exports, Vilsack said. “That has been a very consistent message with the Koreans, with the Chinese, the Japanese, with everyone we talk to about this issue,” he said. “[T]here has to be a pathway and process that is acceptable and gets us ultimately to an open market.”

He argued that passage of the Korea FTA could provide momentum to further opening up the Chinese and Japanese beef markets, although he did not elaborate on that point. China limits imports to U.S. beef from cattle under 30 months of age, while Japan limits imports to beef from cattle under 20 months of age.

On Korea, Vilsack maintained that there is a “pathway over time to further expansion of the market” that may help make Baucus “more comfortable” with the Korea FTA. He said the U.S. is consistent in demanding a pathway for full opening with China, South Korea, and Japan.

According to Vilsack, the United States and South Korea “are in the process of finalizing the translation of the agreement,” although USTR this week announced it was ready to begin talks on the draft FTA implementing legislation with the congressional trade committees.

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