United States-Peru Trade Promotion Agreement Implementation Act

UNITED STATES-PERU TRADE PROMOTION AGREEMENT IMPLEMENTATION ACT -- (House of Representatives - November 08, 2007)

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Mr. MANZULLO. Madam Speaker, I rise today in strong support of the United States-Peru Trade Promotion Agreement.

According to the International Trade Administration, approximately 91 percent of U.S. exports to Peru are manufactured products. Currently, all of these goods are assessed high tariffs--in some instances at double-digit rates. Peruvian manufacturers are not assessed any tariffs when selling to the U.S. market. This market-opening trade agreement levels the playing field for America's manufacturers by eliminating high tariffs on all U.S. manufactured goods within 10 years. Eighty percent of Peruvian tariffs on consumer and industrial goods would be eliminated immediately upon this agreement coming into force.

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To put the cost of these tariffs into perspective, a Caterpillar off-highway truck made in Illinois used for mining exported to Peru costs the end-user an additional $100,000 because of the tariffs. This agreement eliminates this duty immediately. Because Peru does not have a free trade agreement with Japan, H.R. 3688 gives a competitive advantage to Caterpillar over its global competitors such as Komatsu of Japan. The northern Illinois district I am proud to represent has many suppliers to Caterpillar, many of them small manufacturers, selling about $150 million worth of product each year. Having an agreement like this insures the long-term viability of the manufacturing jobs at these firms that may not even know that their product they make eventually finds its way to export markets like Peru.

Madam Speaker, this agreement will greatly benefit other manufacturers of Illinois as well. In 2001, Illinois machinery manufacturers exported $65.8 million worth of goods to Peru. In 2006, that number more than tripled to $198.2 million. Our manufacturers were able to do this in spite of the high tariffs. Imagine what they will be able to do when these tariffs are removed! The independent International Trade Commission estimates that U.S. exports to Peru will increase by $1.1 billion once this agreement is fully implemented. We have seen examples of other market opening agreements that resulted in increasing U.S. exports. Since the adoption of the market-opening agreement with Chile in 2004, U.S. exports to Chile leapt by 33 percent in 2004, 43 percent in 2005, and 38 percent in 2006! Our trade agreement with Australia also helped boost U.S. exports ``down under'' by 25 percent in just two years.

I urge my colleagues to support America's manufacturers by voting ``yes'' for this agreement.

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