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New York and Colombia – A Growing Partnership

A U.S.-Colombia Trade Promotion Agreement (TPA) has the potential to increase both trade and investment between the United States and Colombia, improving on an already strong relationship. In particular, New York stands to gain from increased business ties, as the TPA will create jobs at home through increased export market access for both goods and services, reduced prices for manufacturers, and an improved investment environment.

New York’s Chemical Manufacturers Will Benefit from CTPA

New York is home to many large chemical companies, including Pfizer, Eastman Kodak, and Bristol-Myers Squibb. Yet these companies now face tariffs averaging 8% - and ranging up to 20% - on their exports to Colombia.

CTPA will eliminate immediately 82% of chemical tariffs and phase out the rest over 10 years. These changes are expected to raise U.S. chemical exports to Colombia by 23%, which would equal an increase of $5 million from New York companies alone.

Estimated Increases in U.S. Exports in Sectors Important to New York

  • Fabricated Metal Products 56.4%
  • Processed Foods 36.2
  • Chemicals 22.6
  • Machinery 14.9
  • Computers & Electronics 8.0

EXPORTS

In 2006, Colombia was New York’s 45th largest export market for goods, with exports totaling $103 million.

Colombia will eliminate tariffs immediately on New York’s leading exports, including:

  • Certain chemicals, including photographic chemicals and film
  • Certain auto equipment and parts
  • Certain processed foods and beverages

Colombia also will eliminate tariffs immediately on many farm products, such as:

  • Apples
  • Wines
  • Certain dairy products

The U.S.-Colombia TPA will permit New York’s. financial services firms to establish subsidiaries or branches in Colombia and operate on a cross-border basis.

IMPORTS

The U.S.-Colombia TPA will make permanent the duty-free benefits that 93 percent of New York’s non-textile and apparel imports from Colombia already enjoy.

New York’s Exports to Colombia Will Benefit from Duty Savings and Increased Access to Colombia’s Market

SOURCES & NOTES

(1) U.S. Department of Commerce.
(2) U.S. International Trade Commission, U.S. Department of Commerce, and U.S. Department of Agriculture. For some categories, Colombia’s duties range as high as 20 percent.
(3) U.S. International Trade Commission. The majority of Colombia’s exports have received duty-free treatment under the Andean Trade Promotion and Drug Eradication Act (ATPDEA) since 2002. In addition, Colombia also has received duty-free benefits under the Generalized System of Preferences (GSP) program since 1976.
(4) U.S. Department of Commerce.
(5) U.S. International Trade Commission. The International Trade Commission did not publish separate estimates for chemical, plastic, and rubber products.
(6) Column 1 multiplied by Column 2.
(a) For chemical products, Colombia will eliminate duties affecting 82 percent of New York’s exports immediately upon implementation of the Agreement.
(b) Approximately 70 percent of New York’s industrial equipment exports will receive immediate duty-free treatment. The remaining 30 percent of products will be duty-free within ten years.
(c) Approximately 68 percent of the State’s electronic products will receive immediate duty-free treatment. For information technology product exports 100 percent will receive immediate duty-free treatment.
(d) The vast majority of New York’s exports of processed food products will receive immediate duty-free treatment under the U.S.-Colombia TPA.
(e) Colombia will eliminate tariffs on 38 percent of the State’s steel products and 77 percent of non-ferrous metals immediately. The remaining tariffs will be eliminated over 10 years.

For further information, contact Brigitte Schmidt Gwyn, Director, International Trade & Fiscal Policy 202.496.3263, bgwyn@businessroundtable.org

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