Canada Dominican Republic Free Trade Agreement

Trade is also facilitated for U.S. poultry products, for which many tariff reductions apply immediately and/or were very high (Appendices 1 to 3), particularly chicken piglet quarters. The U.S. poultry industry is constantly looking for new foreign markets for chicken thigh wedies, a largely undesirable byproduct of white meat, which U.S. consumers and the U.S. food industry prefer (for use in processed products and fast foods) (35, 36). These very low-cost products are exported from the United States at the most competitive prices in the world (37). Under NAFTA-DR, exports of chicken quarters are expected to increase in the short term due to the extension of tariff rate quotas, particularly in view of the very high tariffs applied to these products prior to the agreement (Annex 3). Since TRQs are quite small for this product and flow slowly, the effect will be even more significant in the long run if their complete elimination is expected to have a significant impact on availability and price (11).

The expanded market will include consumers who will buy cheap cuts in “wet markets” (meat and fish brands) as well as fast food stores (roast chicken restaurant chains, etc.). El Salvador was the first country to formally introduce cafta to enter into force on March 1, 2006, when the Organization of American States (OAS) received signed copies of the treaty. On 1 April 2006, Honduras and Nicaragua fully implemented the agreement. On 18 May 2006, the Congress of Guatemala ratified CAFTA-DR, which entered into force on 1 July 2006. The Dominican Republic implemented the agreement on 1 March 2007. In a referendum on 7 October 2007, Costa Rica narrowly supported the free trade agreement, with 51.6% voting “yes”; the agreement entered into force on 1 January 2009. [6] Pork and chicken are produced in the United States at very low cost due to the use of high-yield confined feeding operations (generally referred to as “intensive farming”). This cheap meat, sold mainly as a cheap cut, will be in direct competition with domesticly produced pork and chicken, which will probably lead to lower domestic prices in the signatory countries of Central America (11).

For pork, the effects are likely to be immediate, as tariff quotas exceed current imports in all countries other than Honduras and increase in the long run with the increase in quotas (Annex 2). The U.S. pork industry estimates that pork exports to Central America will increase by 20,000 tons per year due to CAFTA-DR (34). . . .

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