Trade Promotion Agreement Research Articles

Could a trade agreement strengthen the enforcement of domestic environmental laws? Envisioning the impacts of the US–Peru environmental submissions mechanism

AbstractCould a trade agreement strengthen the enforcement of domestic environmental laws? This article explores this question in the context of the US–Peru Trade Promotion Agreement (TPA). The article examines, in particular, the potential role of the Secretariat for Submissions on Environmental Enforcement Matters (SEEM) of the TPA. The SEEM is an advisory mechanism to the parties to the TPA which allows citizens to bring direct submissions. This article considers the extent to which the SEEM can facilitate the enforcement of domestic Peruvian environmental law thus helping secure Peruvians' constitutional right to a healthy environment. Existing domestic mechanisms of administrative, civil or criminal law are already available to Peruvian citizens. These can apply to varied situations and provide a range of remedies, but often, they are also costly and lengthy. The SEEM began operating in 2018, and its first six submissions already hint at its potential to become a useful complement to domestic legal avenues. The SEEM could become increasingly used in the future due to Peru's prevalent institutional problems and its interest in maintaining good commercial relations with the United States. The mechanism also has the potential to provide a way to address the autonomous actions of the Peruvian Congress or its subnational governments that sometimes act in defiance of the environmental laws and regulations enforced by the executive branch of the national government. Importantly, however, citizens need to be aware of the limitations of the SEEM as a non‐adjudicatory mechanism and the fact that it is not a policymaking forum. Future research on the SEEM could provide a better understanding of how the process of increasingly mainstreaming the environment in international trade law is beginning to have concrete effects.

Credit constraints and spillover effects of financial market liberalization: Case of Colombia

We identify an effect of deep trade agreements that is previously not studied in the literature. The 2012 US-Colombia Trade Promotion Agreement caused Colombia to liberalize its financial markets, providing greater access to foreign financial services. We show that this financial market liberalization effectively reduced credit constraints faced by Colombian firms. We merge balance sheet data with export transaction data, allowing us to analyze changes in export decisions of more than 7000 firms over the span of 10 years. As a result of the reforms, in sectors that rely more on external financing, exports have increased to the rest of the world. That is, the trade-diversion effects of the agreement were reduced due to improved access to external financing by foreign capital. Thus, we demonstrate a new channel for potential welfare gains from trade agreements.

Análisis de impacto del marco jurídico generado a partir del TLC entre Colombia y Estados Unidos de América sector arroz

After times of protectionism, the predominant foreign trade structure in Colombia was the economic opening after 1990s. In this way, the Barco administration announced a commercial liberalization program with a gradualist orientation of openness, which led to the development of schemes such as the ATPDEA, to establish a framework of foreign trade and antidrug policy between the Republic of Colombia and the United States of America. However, these preferential trade strategies between the parties depended on the validity of the negotiations and, above all, on the approval of the administrations on duty. This is how negotiations took place between representatives of the governments of Colombia and the United States, to establish a long-term trade agreement, disconnected from the domestic policy of each country. These negotiations culminate with the publication of Decree 993/2012, which promulgates the entry into force of the Trade Promotion Agreement (TPA), between the Republic of Colombia and the United States of America. However, the treaty generated a serious impact in the agricultural sector and within it, in the national production of rice. The side effects of the signing of the Trade Promotion Agreement are mainly due to differences in factors such as infrastructure, roads, subsidies, production and comparative costs, and its main negative impact has been the risk of loss of food sovereignty. The following article will develop the legal vision of the Trade Agreement between Colombia and the United States and how these legal measures have been insufficient to equate the burdens in the productive sectors of rice between both countries.

Enforcement Practice Under Preferential Trade Agreements: Environmental Consultations and Submissions on Environmental Enforcement Matters in the US-Peru TPA

The US-Peru Trade Promotion Agreement (TPA), in force since 2009 contains an environment chapter and a particular Annex on Forest Sector Governance with strong provisions to tackle trade associated with illegal logging and to promote legal trade in timber products. Both the Chapter and the Annex are subject to governmental environmental consultations, linked to the Dispute Settlement Mechanism of the TPA. Additionally, the treaty grants the right to file a submission to any person when a Party is failing to effectively enforce its environmental laws, with a Secretariat created just in 2015. As a result, three files have been already submitted against Peru seeking the implementation of (1) an international environmental agreement, (2) the national environmental law and, (3) a provision of the Annex of the TPA. On the latest, furthermore, the US Government requesting in January 2019 the first consultations on environmental matters involving forest issues under a TPA.

The United States Resolves Its Request for Consultations Regarding Peru's Environmental Obligations Under Bilateral Trade Agreement

On April 9, 2019, the United States and Peru reached a resolution regarding concerns about Peru's forest sector obligations under the 2007 United States–Peru Trade Promotion Agreement (PTPA). At issue was Peru's relocation of the Agency for the Supervision of Forest Resources and Wildlife (OSINFOR) to a “subordinate position” in its Ministry of Environment in December 2018. The United States requested consultations under the PTPA on the ground that this relocation conflicted with a provision in the Environment Chapter's “Annex on Forest Sector Governance” (Forest Annex), which states that “OSINFOR shall be an independent and separate agency.” Following the consultations, Peru agreed to restore OSINFOR to its original location within the Peruvian government.

United States Requests Consultations Regarding Peru's Environmental Obligations Under Bilateral Trade Agreement

On January 4, 2019, the United States requested consultations with Peru with respect to its forest governance obligations under the 2007 United States – Peru Trade Promotion Agreement (PTPA). The PTPA has an environmental chapter with robust terms that were included largely at the insistence of members of Congress, reflecting concerns that a free trade agreement with Peru could increase the country's export of illegally logged wood to the United States. The request for consultations focused on Peru's decision to relocate its Agency for the Supervision of Forest Resources and Wildlife (OSINFOR) to within Peru's Ministry of Environment—a change that, in the view of the United States, “appears to conflict” with a PTPA obligation that “‘OSINFOR shall be an independent and separate agency.’”

Deforestation and the United States–Peru Trade Promotion Agreement

Do environmental provisions in trade agreements make a difference? In part to coopt environmental criticisms, the United States has included environmental components to trade agreements since NAFTA side agreements in the mid-1990s. Environmental components are increasingly more integrated and more specific, as illustrated by the 2009 United States–Peru Trade Promotion Agreement (PTPA). In exchange for increased market access to the United States, the Peruvian government agreed to reduce illegal logging and improve forest sector governance. Recent qualitative assessments of deforestation highlight difficulties in implementing the specific requirements of the PTPA’s Annex on Forest Sector Governance, but tests with Peruvian data on logging appear unreliable. We circumvent this difficulty by using satellite imagery of deforestation across Peruvian border regions and by engaging multiple methods to estimate the PTPA’s impact. All results suggest that deforestation has actually increased since the PTPA entered force, although no more than in other Amazonian countries. We conclude by emphasizing the limits of external imposition of environmental rules, which appear prone to failure unless domestic interests mobilize in their support.

Diffusion Through Issue Linkage: Environmental Norms in US Trade Agreements

How do environmental norms and policies diffuse across borders? In this article, we argue that preferential trade agreements (PTAs) can play an important role in this process. Specifically, we argue that the US has long used PTAs as mechanisms to diffuse such norms, and show this through an empirical examination of three US PTAs, each from a distinct phase of US trade policy. We demonstrate how the US used the North American Free Trade Agreement, the Central American Free Trade Agreement, and the US-Peru Trade Promotion Agreement as vehicles to diffuse norms of (1) public participation in environmental policy-making, and (2) effective enforcement of environmental laws to trading partner nations. In doing so, we both illuminate a new mechanism of environmental norm diffusion and demonstrate the importance of this mechanism in changing environmental policy and practice across borders.

El Perú en el Tratado de Asociación Transpacífico (TPP): beneficios y mitos

The Trans-Pacific Partnership Agreement (TPP) is the first mega-regional trade agreement of the XXI century. It is composed of twelve economies of three continents, all members of the Asia-Pacific Economic Cooperation (APEC).Peru’s participation in this exceptional agreement means winning five new markets in a single trade agreement: Australia, Brunei Darussalam, New Zealand, Malaysia and Vietnam. The potential increase in non-traditional Peruvian exports to those markets by the entry into force of the TPP Agreement is estimated in US$ 2,250 million. The country also gains by improving in TPP the conditions of access and trade rules of previous bilateral agreements.One of the biggest gains from TPP for developing economies like Peru is the access to global value chains, as a result of the application of a mechanism known as «origin accumulation». This mechanism will particularly benefit SMEs, as inputs they export can be introduced in a value chain of the TPP trading bloc.Regarding myths about negative impacts of the TPP, specifically about a supposed rise in prices of medicines, alleged millionaire losses in Investor-State Dispute Settlement arbitrations, and alleged restrictions on freedoms in the Internet, it is not true that the TPP Agreement generates adverse effects in these areas The same myths were spread during of the US-Peru Trade Promotion Agreement negotiations, and none of it happened in reality.

Focus: Free Trade and Precarity in Peru

INTERNATIONAL union rights Page 6 Volume 23 Issue 1 2016 The OTLA has issued recommendations to the Government of Peru with a view to ensuring compliance with the obligations contained United States-Peru Trade Promotion Agreement after the complaint was raised against Guatemala under the Dominican Republic-Central America FTA (CAFTA-DR), the US finally escalated the dispute to arbitration in September 2014. During that time, some 70 labour organisers in Guatemala were reported killed, but no mention was made of the systematic use of violence against trade unionists in the US’ submissions to the arbitral panel. A hearing took place in June 2015, but the disputing parties remain embroiled in trying to decipher what it means to ‘fail to effectively enforce labor laws… in a manner affecting trade or investment between the Parties’ – treaty text that is reproduced in both CAFTADR and the PTPA. Any decision in the dispute will still be years in the making. Booming trade, busting unions The PTPA entered into force in 2009. In the first five years of the agreement, revenue from non-traditional export (NTE) sectors from Peru to the US increased by 80 percent, and total export revenue from Peru to the US increased by 26 percent. As a result, the demand for labour in the NTE sectors has also grown. NTE sectors include textiles and apparel, agricultural and fishery products, jewellery , wood and paper, and non-metallic minerals. According to the OTLA’s report, the plight of workers in Peru’s NTE sectors has not been much improved by the export boom. Following the allegations of union-busting in the NTE sectors submitted in July 2015, the OTLA conducted a review of the claims between September 2015 and March 2016, entailing consultations with stakeholders (including the government of Peru, the submitters and other workers’ organisations) and a fact-finding mission to Peru. Under Peruvian law, both the government and employers must refrain from ‘any acts likely to constrain, restrict or impair, in any way, the right of workers to unionize; and intervening in any way in the establishment, administration, or maintenance of trade union organizations.’ Further legal instruments were enacted in 2007, in order to clarify that any use of short-term contracts to limit freedom of association is unlawful and deemed a ‘very serious offense’, with violations subject to hefty fines. In NTE sectors, the use of short-term contracts is governed by Decree Law 22342, the Law Promoting Non-Traditional Exports, which provides that – subject to certain exceptions – employers may hire workers on short-term contracts and that such contracts may be renewed as many times as is necessary. In all other sectors, the use of consecutive short-term contracts is limited to five years. The OTLA report found that ‘employers often do not renew the short-term contracts of workers who O n 18 March 2016, the US Department of Labor’s Office of Trade and Labor Affairs (OTLA) published its public response1 to a complaint filed under the United States-Peru Trade Promotion Agreement (PTPA) by the International Labour Rights Forum (ILRF), Perú Equidad, and seven Peruvian workers’ organisations . Under Article 17.2.1 of the PTPA, each party to the agreement is obliged to ‘adopt and maintain in its statutes and regulations, and practices thereunder, the following rights, as stated in the ILO Declaration on Fundamental Principles and Rights at Work and its Follow-Up (1998): (a) freedom of association.’ Article 17.3.1(a) further states that a party ‘shall not fail to effectively enforce its labor laws, including those it adopts or maintains in accordance with Article 17.2.1, through a sustained or recurring course of action or inaction, in a manner affecting trade or investment between the Parties, after the date of entry into force of this Agreement.’ The complaint – filed on 23 July 2015 – alleged that ‘by permitting the unlimited consecutive renewal of short-term contracts under the law that governs employment contracts in the nontraditional export (NTE) sectors, the Government of Peru has failed to meet its PTPA commitment to adopt and maintain in its statutes and regulations , and practices thereunder, the right of freedom of association and the effective...

Globalisation and Exploitation in Peru: Strategic Selectivities and the Defeat of Labour in the US-Peru Trade Promotion Agreement

This article examines the socio-economic implications of the US-Peru Trade Promotion Agreement for the governance of Peruvian labour relations. It is argued that the trade agreement aims to lock-in the neoliberal market reforms carried out since the 1990s, which have given rise to an export-oriented regime of accumulation that is characterised by considerable labour exploitation. The marginal role of organised labour and social movements to influence the course of events is placed against the backdrop of neoliberal hegemony and the altered state-society relations that followed from it. Most notably, it identifies the incapability of movement leaders to supersede the grassroots level and develop the necessary political linkages on the one hand, and deliberate government strategies that formed part of a powerful pro-free trade coalition of state officials and the corporate sector on the other hand. The article concludes that the ascendency of the neoliberal state has come to rely on increasingly coercive methods to curb more critical and anti-free trade elements in Peruvian organised labour and social movements.

Logging concessions enable illegal logging crisis in the Peruvian Amazon.

The Peruvian Amazon is an important arena in global efforts to promote sustainable logging in the tropics. Despite recent efforts to achieve sustainability, such as provisions in the US–Peru Trade Promotion Agreement, illegal logging continues to plague the region. We present evidence that Peru's legal logging concession system is enabling the widespread illegal logging via the regulatory documents designed to ensure sustainable logging. Analyzing official government data, we found that 68.3% of all concessions supervised by authorities were suspected of major violations. Of the 609 total concessions, nearly 30% have been cancelled for violations and we expect this percentage to increase as investigations continue. Moreover, the nature of the violations indicate that the permits associated with legal concessions are used to harvest trees in unauthorized areas, thus threatening all forested areas. Many of the violations pertain to the illegal extraction of CITES-listed timber species outside authorized areas. These findings highlight the need for additional reforms.

Understanding United States Foreign Policy Toward Latin America: Lessons From A Comparison of Nafta and the Colombian Trade Promotion Agreement

UNDERSTANDING UNITED STATES FOREIGN POLICY TOWARD LATIN AMERICA: LESSONS FROM A COMPARISON OF NAFTA AND THE COLOMBIAN TRADE PROMOTION AGREEMENT Margaret M. Commins Queens University of Charlotte Ongoing issues with violence and drug trafficking in both Mexico and Colombia invite frequent comparisons between the two countries (Bonnor, 2010; Fukuyama and Colby, 2011). Indeed the parallels are significant . Both Mexico and Colombia are marked by some of the highest per capita murder rates in the world, weak and ineffective judicial institutions , and large swaths of each country considered ungovernable. And, perhaps predictably, United States policy toward both countries is similar as well. Plan Colombia, the United States’ response to narco-trafficking and violence in Colombia, and the Merida Initiative, the United States’ response to Mexico’s drug wars, both emphasize military solutions to drug trafficking, combined with varying degrees of emphasis on state-building and socioeconomic development. In terms of United States policy toward Latin America, however, these countries share another commonality, one that is not as well-explored: the United States signed and implemented preferential trade agreements (PTAs) with each. President Carlos Salinas de Gortari of Mexico and President George H.W. Bush of the United States endorsed the notion of a bilateral free trade agreement between their countries in June of 1990. In September, 1990, Canada asked to be included in the negotiations, and the resulting “North American Free Trade Agreement” (NAFTA) was passed by the United States Congress in 1993, and implemented on January 1, 1994. The Colombia Trade Promotion Agreement (CTPA) was signed by President Alvaro Uribe of Colombia and President George W. Bush in November, 2006, passed by the United States Congress in October, 2011, and entered into force on May 15, 2012. Though passed by the United States Congress almost twenty years apart, these agreements are quite similar. Both are preferential trade agreements signed between a developed country, the United States, and a developing Latin American country (and, in the case of NAFTA, another developed country, Canada). Both were initiated and negotiated primarily by Republican administrations, but shepherded through the United States Congress by Democratic presidents. At least rhetorically, both were touted by these presidents as demonstrations of major shifts in United States policy toward Latin America. Both agreements were passed in times of C 2013 Southeastern Council on Latin American Studies and Wiley Periodicals, Inc. 73 The Latin Americanist, December 2013 economic and fiscal difficulty for the United States. Both agreements were passed during periods of strain in the multilateral trading system. And, each agreement faced its most significant opposition not from business interests fearing import competition, but from citizen and labor groups worried about a variety of human rights issues, including the treatment of labor and potential environmental degradation. It is common to explain policymakers’ decisions to pursue trade agreements with reference to the demands of powerful economic interests that will benefit from an agreement’s provisions, particularly the opening of foreign markets and increased protection for foreign direct investment (see, for example, Milner, 1988; Rogowski, 1989; Hiscox, 2002). Though economic interests (capital and labor) that will be hurt by increased importcompetition will lobby against free trade agreements, if an agreement includes liberalization that will benefit a sufficiently broad and powerful coalition of economic interests, we can expect policymakers to pursue it. But, explaining U.S. support for NAFTA and CTPA in these terms is problematic. For one, explanations based on the preferences of interest groups are not always as compelling in the case of PTAs, particularly North-South trade agreements like NAFTA and CTPA. The potential economic benefits are usually much smaller. And, because opposition to these agreements is quite strong in the United States, particularly from non-economic interests like environmental and human rights groups, the interest group politics are more complex than those captured by analyses focusing on economic interests. Indeed, negotiating North-South PTAs is relatively costly for U.S. policymakers. These agreements cover a range of issues – from trade and investment to labor standards and environmental protection – and require significant time and attention to negotiate. And, unlike many foreign policy decisions taken by the United States government , trade agreements must be passed by both houses of the United...

Understanding United States Foreign Policy Toward Latin America: Lessons From A Comparison of NAFTA and the Colombian Trade Promotion Agreement

Understanding United States Foreign Policy Toward Latin America: Lessons From A Comparison of NAFTA and the Colombian Trade Promotion Agreement

US-Panama Free Trade Agreement: What Is in It for Florida Agriculture?

On October 12, 2011, four years after it was agreed upon by both parties, the United States government signed into law the reciprocal US–Panama Free Trade Agreement (FTA)/Trade Promotion Agreement (TPA). The FTA provides US companies with better access to the Panamanian market and ensures that most US exports of consumer and industrial products to Panama will be accorded immediate duty-free privileges. The main elements of the US–Panama FTA as it relates to agricultural trade revolve around market access, agricultural export subsidies, safeguards, the sugar compensation mechanism, and sanitary and phytosanitary measures. This 11-page fact sheet was written by Edward A. Evans and Fredy H. Ballen and published by the UF Department of Food and Resource Economics, May 2013.
 http://edis.ifas.ufl.edu/fe932

Factor adjustment implications of a Trade Promotion Agreement between the United States and Colombia

PurposeThis paper proposes to use changes in intra‐industry specialization indicators over the period 1996‐2008 to assess the potential for factor adjustment pressures that may arise in the USA if the proposed USA‐Colombia Trade Promotion Agreement (TPA) is implemented. Results show that there is considerable scope for intra‐industry specialization between Colombia and the USA. The TPA should result in a larger increase in US exports to Colombia than US imports from Colombia, because Colombian exporters face much lower tariffs in the USA market than do US exporters in the Colombian market. Given the tariff asymmetry, scope for intra‐industry specialization, the relatively large size of the US market, and the small number of US industries that are likely to encounter factor adjustment pressures, the USA should ratify the agreement immediately.Design/methodology/approachChanges in intra‐industry specialization indicators are used to identify US industries that may face factor adjustment pressures as a result of the proposed USA‐Colombia TPA.FindingsThere is considerable scope for intra‐industry specialization between Colombia and the USA. Few US industries will be candidates for factor adjustment pressures.Practical applicationsThe USA should ratify the TPA.Originality/valueA new methodology is used to assess potential factor adjustment pressures associated with a TPA.

Strategic Linkages: The Evolving Role of Trade Agreements in Global Environmental Governance

Recently negotiated linkages between trade and environmental agreements have the potential to enhance environmental regime effectiveness in ways that have been impossible under environmental treaties alone. Specifically, the 2009 U.S.—Peru Trade Promotion Agreement (TPA) contains the most prescriptive environmental directives found in any U.S. trade agreement to date and pioneering provisions linking environmental treaty implementation to the TPA’s much stronger dispute-settlement procedures. The combination of these two elements has begun to catalyze Peru’s implementation of relevant environmental provisions and a corresponding potential for regime effectiveness improvements. Simultaneously, these prescriptive provisions contributed to catastrophic social unrest in Peru that must be acknowledged and addressed by policy makers in the United States and abroad before this agreement is exported to other countries.

The United States-Peru Trade Promotion Agreement: What Did You Expect?

Bilateral free trade agreements have generally been analyzed as instances of preferential reciprocal tariff liberalization. Viewed through this lens, such agreements raise concerns both about new competition and about trade diversion. The United States-Peru Trade Promotion Agreement, an example of a serious North-South accord, demonstrates that new market access was not a principal Peruvian goal in the trade negotiations. Instead, the agreement was intended to encourage investment by locking in Peru’s economic reforms. This motivation has very different implications for the global trading system than a quest for preferential access.

Pregnancy Discrimination in Latin America: The Exclusion of “Employment Discrimination” from the Definition of “Labor Laws” in the Central American Free Trade Agreement

Regional trading blocs and bilateral trade agreements have become increasingly important within the western hemisphere. The North American Free Trade Agreement (NAFTA), the U.S.-Chile Free Trade Agreement, and the Central America Free Trade Agreement (CAFTA) have all been passed in the last fifteen years. This Article will focus principally on the provisions in NAFTA and CAFTA. (1) Additionally, with the Andean Trade Preference Act set to expire in 2006, the United States initiated negotiations with three Andean countries in May 2004: Peru, Colombia, and Ecuador. The United States Trade Representative (USTR) signed the United States-Peru Trade Promotion Agreement in April 2006, concluded negotiations with Colombia in February 2006, and is participating in ongoing discussions with Ecuador. (2) Furthermore, the Administration announced in 2003 that it intends to launch negotiations for a separate agreement with Panama, and the Senate recently approved a resolution of advice and consent for a United States-Uruguay Bilateral Investment Treaty in September 2006. (3) All of these bilateral and regional agreements represent a building block (4) in the attempt to secure a Free Trade Area of the Americas despite its current dim prospects. (5) Free Trade Areas/Agreements (FTAs) are cross-border arrangements in which the trade barriers--both tariff and non-tariff barriers--among participating nations are reduced, sector-by-sector over time, and often eventually abolished. Unlike a customs union or a common market, each member country of the FTA remains free to determine its own external trade barrier against non-FTA members. For businesses operating within the FTA, the market expands because consumers in member states can purchase their products for a lower price than before the FTA was established, and usually also at a lower price than goods originating outside of the member countries. (6) At the same time, businesses are subjected to increased competition. While rights provisions are now standard in American FTAs, (7) their incorporation has not been without controversy. The movement to incorporate rights into FTAs is driven by a number of interests, including interests in the United States, international rights movements, and human rights activism. The incorporation of rights in FTAs, however, is often resisted on two main grounds: (1) as an attempt to lower the less-developed countries' comparative advantage of lower wages, and/or (2) as an infringement on the less-developed countries' sovereignty. (8) The integration of trade and has been incremental. For example, the original NAFTA agreement did not include protections; instead, the agreement was negotiated separately from, and subsequent to, the passage of NAFTA. (9) More recently, CAFTA explicitly incorporated rights into the core text, indicating acceptance of the idea that rights and trade should be addressed simultaneously. When one compares the two agreements, however, the North American Agreement on Labor Cooperation (NAALC) used an eleven-part definition of labor laws that included elimination of ..., (10) while CAFTA reduced the definition to five rights, and excluded employment discrimination from its definition of law. (11) In relation to protections, pregnancy is an issue of growing importance in U.S.-Latin America FTAs. Pregnancy is considered a form of sex discrimination, as it is based on a condition unique to women. (12) This issue first emerged in the NAFTA context following the publication of a 1996 Human Rights Watch report that exposed pervasive pregnancy in maquiladoras in Mexico. (13) In 2004, Human Rights Watch released a report confirming that pregnancy-based was pervasive in the Dominican Republic's free trade zone. (14) Women in both of these countries were, and continue to be, routinely required to undergo pregnancy tests or answer intrusive questions regarding their possible pregnant status as a condition of being hired or maintaining employment. …