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ACGA questions questions trade agreements' impact on increased imports of ethanol

(Friday, May 21, 2004 -- CropChoice news) -- From an American Corn Growers Association news release:
Contact: Larry Mitchell, 202.835.0330

WASHINGTON, May 19, 2004- "The American Corn Growers Association, in light of the recent decision by a large grain trading company to import ethanol from Brazil via El Salvador, questions whether we can expect more ethanol imports if the U.S.-Central American Free Trade Agreement (CAFTA) and the Free Trade Area of the Americas (FTAA) are completed and ratified," stated Larry Mitchell, the organization's Chief Executive Officer.

Recently, Cargill announced its intent to import ethanol produced in Brazil and further processed in El Salvador, one of 27 countries included in the Caribbean Basin Initiative (CBI). Under the terms of the CBI, member nations may export ethanol into the U.S. up to a total limit of seven percent of U.S. production per year.

"As disturbing as the announcement by Cargill may be, our long-range concern is that the pending trade agreements will expand the ethanol importation limit, or completely eliminate the limitation thus allowing unlimited importation of ethanol," added Mitchell.

Negotiations are currently underway on CAFTA, initiated in Jan. 2003 by Costa Rica, El Salvador, Guatemala, Nicaragua, and the U.S., and the FTAA, initiated in 1994 by thirty-four governments from the western hemisphere.

"According to the U.S. Trade Representative's CAFTA agriculture fact sheet, 'No products are excluded from the agreement,'" said Mitchell. "The fact sheet also states that 'Tariffs will be eliminated for all products, except sugar for the United States.' This trade agreement could present a much more serious problem than the current Cargill initiative which uses the CBI as a way to import foreign ethanol."

"Brazil is not a party of CAFTA or the CBI, but is a party to the FTAA. Should we then expect more ethanol imports from Brazil upon completion and ratification of FTAA?" asked Mitchell. "These concerns need to be properly addressed before completion of these agreements. ACGA will oppose any trade agreement, such as CAFTA, FTAA, or any other trade agreement which advance other sectors of the U.S. economy at the expense of U.S. farm families."

"The United States needs a national energy policy which ensures affordability and reliability through diverse, decentralized, domestic and renewable energy sources," concluded Mitchell. "We can not safely outsource any more of our energy production."

Source: http://www.acga.org