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USDA International Egg and Poultry

07 November 2012

USDA International Egg and Poultry: PanamaUSDA International Egg and Poultry: Panama

After the United States (U.S.) signed into law the U.S.-Panama Trade Promotion Agreement (TPA) on October 2011, the trade agreement will enter into force on October 31, 2012. The announcement comes after a thorough review by the respective countries of their laws and regulations related to the implementation of the Agreement.
USDA International Egg and Poultry

In December 2006 the U.S. and Panama signed an extensive agreement concerning sanitary and phytosanitary measures along with technical standards. Under this fully implemented agreement Panama recognized the equivalence of the U.S. food safety inspection system for meat and poultry, and the U.S. regulatory system for processed foods.

Before the Panama TPA, Panama’s tariffs were as high as 260% on chicken leg quarters. After the U.S. Congress had passed the Caribbean Basin Initiative in1983, 99% of Panama’s exports have been entering the U.S. duty free. In 2011 the U.S. share of Panama’s agricultural imports was 42%. Without the TPA it was expected the U.S.’s share of Panama’s agricultural imports would gradually diminish since they currently have free trade agreements (FTA) with Canada, Chile, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Singapore, and Taiwan. Panama is negotiating a new FTA with Colombia and are considering negotiations with Korea, India, and Peru.

Under the Panama TPA the 260% tariff on chicken cuts will be eliminated immediately on mechanically de-boned chicken, within 5 years for wings, and within 10 years for other chicken cuts, except for leg quarters. Panama will immediately provide duty-free access on leg quarters within a preferential tariff-rate quota (TRQ) that starts at 660 metric tons and grows 10% annually. The 260% over-quota tariff will be eliminated in 18 years. U.S. poultry exporters will continue to have access to the global 756 metric ton TRQ for chicken cuts that is part of Panama’s World Trade Organization commitments.

Panama will immediately eliminate the 15% duties on turkey meat for frozen whole turkeys and most frozen turkey cuts. The 15% tariffs on processed turkey and chicken will be eliminated within 5 years.

In July 2010 the Minister of Agricultural Development of Panama presented the Strategy for the Development of the Agricultural Sector of Panama based on 5 core topics. The topics included To Reduce the Cost of Food Staples, Restructuring Productivity, Commercialization, Rural Development, and Modernization of the Integrated Agricultural Institutions and Public Sector.

Agriculture and tourism are considered the key engines to the country’s growth. The plan’s actions are designed to promote development of the rural sector which represents 44% of Panama’s total population, address poverty concerns, and also improve the well being of producers and the general population by means of a competitive, participative and sustainable agricultural sector.

Sources: Office of the U.S. Trade Representative; USDA, Office of Communications; USDA, Foreign Agricultural Service U.S.-Panama Trade Promotion Agreement Benefits for Agriculture; USDA, Foreign Agricultural Service U.S.-Panama Trade Promotion Agreement State Fact Sheets; USDA, Foreign Agricultural Service Gain Report Number PN10006

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