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Benefits of the US-Taiwan FTA » Sector by Sector
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A United States-Taiwan Free Trade Agreement (FTA) will enhance the strong relationship between our two democratic countries by expanding trade and investment, promoting economic security, and creating new opportunities for workers and businesses in the US and Taiwan.
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AGRICULTURE and TAIWAN  
A Partner for Growth: An FTA will enhance access to a critical market for U.S. farmers and ranchers.
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Taiwan is the 5th largest market for U.S. agricultural products, consistently importing over $2 billion worth of U.S. farm products annually. Taiwan is especially important for such high-value exports as beef and poultry, coarse grains (corn, barley, and sorghum), soybeans, dairy products, horticultural products and citrus products.
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In 2006, in terms of consumption per capita, Taiwan was the largest consumer of U.S. agricultural products, the 3rd largest overseas market for U.S beef and corn, the 5th largest overseas market for U.S. soy beans and the 8th largest overseas market for U.S. wheat. An FTA will promote further growth in the export of these high-value U.S. products.
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Every one or two years, Taiwan dispatches an agricultural Procurement Mission to the U.S. to sign multi-billion dollar deals. For example, the value of the 2005 purchase reached $3.1 billion, $400 million more than the 2003 agreement. Judging from these trends, it is clear that US farmers would enjoy immediate benefits from the signing of an FTA.
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Although Taiwan reduced its duties on agricultural imports as part of its WTO accession, large barriers remain for U.S. rice, poultry, and pork under Taiwan's Tariff Rate Quotas system. An FTA with Taiwan means certain tariffs drop from as much as 300 percent to almost zero.
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Both sides stand to benefit from a comprehensive agricultural agreement. According to a report from the Institute for International Economics (IIE), almost every agricultural category will experience overall net trade gains.
A Unique Opportunity: An FTA will further integrate U.S. agricultural producers with expanding Asian markets.
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According to the IIE study, freer trade of agriculture has the added benefit of reducing the U.S. deficit in a number of important sectors: vegetables, fruits, and nuts ($163 million surplus); meat products ($56 million surplus); and other foods ($322 million surplus), to name a few.
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Taiwan produces many processed foods with U.S. ingredients and exports them to their Asian neighbors. As these sales increase, sales of U.S. agricultural products will also grow, further integrating the U.S. market with an emerging Asia, allowing U.S. producers to indirectly tap into a vast market.
THE NUMBERS
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Taiwan is the 5th largest market for U.S. agricultural products
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An FTA offers U.S. farmers potential new income gains of $500 million or more.
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Among all U.S. trading partners, Taiwan imports the 3rd most U.S. corn and beef, the 5th most soybeans, and the 8th most wheat.
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THE NEXT LOGICAL STEP: A U.S.-Taiwan FTA holds great promise for both U.S. and Taiwanese companies and workers. The agreement will bring with it new dynamism that will keep U.S.-Taiwan economic relations vital and strong. We look forward to working together with you to make this historic agreement a reality.
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