After 3 days on Capitol Hill meeting with congressional members, staffers and various trade and diplomatic offices, here is what I’ve learned.
Our businesses and our farms are being held at the mercy of US legislators who are negotiating a trade package that will include free trade agreements (S.Korea, Panama, and Colombia) and preference programs that expired late last year and on Feb 12th 2011.
Under the ATPDEA (Andean Trade Preference-Drug Eradication Act) US business people such as our company and our trade partners were asked to go out into rural Ecuador especially on the borders with Colombia and Peru to offer jobs and business opportunities to land owners and workers. Both American and Ecuadorian business leaders have made these investments and to date Ecuador has zero acres of Coca-leaf production. In contrast, Colombia has over 170,000 acres of Coca production and Peru over 200,000 acres according to the US government. Recently Ecuador found 7 acres near the Colombian border and it was a huge scandal, the government quickly moved in and eradicated it. Ecuador is a very serious partner with the United States and the world with regard to illegal drug eradication.
Ecuador has been successful in building businesses that offer opportunity beyond illegal narcotics. Now the US government over the past few years has forgotten its partner, allowed its ATPDEA beneficiary status to come close to expiration only to be renewed for 6 weeks, then renewed for 6 months and now not at all. Its costing millions in tariffs to businesses that support the US economy and to businesses that are expected to continue investments without clear direction from the US government. No business can continue to make necessary investments that benefit trade with the United States without clear direction in regard to the costs of doing business.
Aside from Oil exports, the US enjoys a trade surplus with Ecuador; Ecuador uses the US dollar as its monetary unit and has always been a strategic partner to the United States. Ecuador has also cooperated with the United States in the struggle against international terrorism. Ecuador is a peaceful republic that is not requiring billions in military aid as other US partners do, and it’s not a country that has a trade deficit with the US or takes US jobs.
A 6.8% tariff is being imposed on our products and this is putting some farms in difficult positions. One of our leading partners in Ecuador is now paying over $100,000 in tariffs per month and requiring more expense just to wade through the red tape of requirements. Other industries like frozen broccoli exporters are paying 15% tariffs now and its unclear how they will continue to invest in Ecuador for the US market.
Cut flower workers enjoy social security (Pensions and Health benefits), overtime wages past 40 hours, savings accounts and more benefits than typical US farm workers. Ecuador’s workforce is not illegal immigrant labor that fears to stand up and speak if being abused or not paid its wages. In contrast, a farm that might be using illegal immigrant labor in the US could have employees that are paid low cash wages under the table, and those employees could risk deportation if they were to stand up against unfair wages or treatment by farm owners.
If US business owners and Ecuadorian national business leaders cannot count on the US government for clear and permanent direction on its trade relationships with Ecuador, many farms will be forced to close, lower wages, cut costs, or cut programs like certifications for organic and sustainable production methods. These programs ensure US consumers know who has grown their products, how the environment was cared for and how well the workers are treated, paid and trained to do their jobs safely. This will be a major step backwards for the United States and its growing green sector jobs and forward moving global leadership.
The US government cannot ignore countries because they are not currently problems. Ecuador not being a producer of coca is not a coincidence, Ecuador supporting the US on the war on terrorism is not a coincidence. Ecuador is one of the most eco-friendly, democratically elected governments in South America. We have similar interests, share the same currency and our government should support this country NOW and not wait until it has a civil war or major crops of illicit drugs.
Flower crops that are part of the ATPDEA are not crops that take jobs from Americans. These flowers cannot be grown in the US.
Over 70% of the flowers sold in the US are grown in Colombia and Ecuador. The US does not have the production potential to grow this domestically; many varieties will not grow commercially in the US and this industry employs many union and non-union workers throughout the United States.
Kroger Supermarkets and Safeway alone with their union labor in the floral department buy 95% of its roses from Ecuador and Colombia. Without these flowers, nearly 3,300 Union Floral Attendants would lose their jobs in a department shut down due to lack of supply or higher prices that makes the category un attractive to maintain in their stores.
There are over 36,000 Supermarkets in US where the floral department has been a solid department since the late 70’s early 80’s. Over 20,000 direct jobs in the supermarket floral departments and distribution centers are due to supply coming from Ecuador and Colombia. This is a $30 Billion Dollar a year industry in the United States.
Miami Florida is the largest importer and exporter of products between Ecuador and the United States. Over one hundred Cut flower import companies reside in Miami and employ thousands of skilled and unskilled workers, from sales and marketing executives, to dock workers and truck drivers, Ecuador is a key part of the US economy and should be treated fairly with regard to international trade. Not only should the ATPDEA be renewed now, but also it should be renewed no shorter than 2 years while a serious effort towards a more permanent trade framework can be established.
