In early February, Zoellick announced conclusion of a free trade agreement (FTA) between the U.S. and Australia. Negotiations for the FTA began in March 2003.
The Office of the Trade Representative characterizes the pact as “a 21st Century state-of-the art agreement that reflects the modern globalized economy, opening markets and streamlining mutual access in intellectual property, services, government procurement, e-commerce, and investment.”
More than 99% of U.S. manufactured goods – which comprise 93% of all exports to that country – will become duty-free.
With trade agreements in place with Israel and Jordan, the U.S. initiated negotiations with Bahrain earlier this year, and reached agreement on a comprehensive FTA with Morocco earlier this month. The pact is part of the U.S. Administration’s initiative to create a Middle East Free Trade Area by 2013.
The U.S. currently exports 475 million in products of the total of $11 billion that Morocco imports each year. While U.S. exports of fabrics and pharmaceuticals to Morocco have increased of late, primary products include corn, aircraft and machinery.
Motivation for Zoellick to initiate FTA negotiations with Thailand – announced on February 12 and so legally able to begin 90 days later – is that the U.S. is a major supplier of agricultural products to that country. In 2002, Thailand was the 16th largest market for U.S. farm exports.
“Many of Thailand’s products already enter the U.S. market duty-free under the Generalized System of Preference,” notes Zoellick. “An FTA would make duty-free treatment reciprocal.”