Congressman Faleomavaega announced today that he testified before the International Trade Commission (ITC) as part of his ongoing effort to protect American Samoa’s future.
“In the coming year, the United States will begin to negotiate free trade agreements with Panama and the Andean countries, including Ecuador and Colombia,” the Congressman said. “Once again, reducing or eliminating tariff rates on canned tuna is being debated.”
“However, this time, Congress will not have an opportunity to offer amendments to the trade agreement. Instead, Congress will only be allowed to vote, yes or no, for the agreement that the Administration will propose.”
“The ITC will make a recommendation to the United States Trade Representative (USTR) based on testimony given at today’s hearing,” Congressman Faleomavaega said. “As a matter of record, I appeared before the ITC and informed the Commissioners that
the United States Territory of American Samoa lies 2,300 miles southwest of Hawaii, covers a land area of 76 square miles, has a population of less than 65,000 and a per capita income of $4,300 per year. Due to scarcity of land, labor and capital, economic growth and development in American Samoa has been limited.
“In fact, more than 80% of American Samoa’s economy is dependent either directly or indirectly on two United States tuna canneries (StarKist and Chicken of the Sea) which employ more than 5,150 people of 74 percent of the workforce. As was repeatedly stated during the Andean Trade Preference (ATPA) debate, a decrease in production or departure of one or both of the two canneries in American Samoa could devastate the local economy resulting in massive layoffs and insurmountable financial difficulties.”
“Needless to say, any fluctuation in global tariff rates places our canneries at risk. As StarKist has repeatedly stated, the only market for tuna from American Samoa is the United States and this is why I have provided the USTR, the ITC and the House and Senate with documentation that clearly shows that the Andean countries have the production capacity to destroy U.S. tuna operations in American Samoa, Puerto Rico, and California.”
“Ecuador and Colombia have the capacity to jointly process 2,250 tons of tuna per day or 48.6 million cases per year,” Congressman Faleomavaega said. “Given that total U.S. consumption is only about 48 million cases per year, the Andean countries have the production capacity to supply the entire U.S. market and wipe out the economy of American Samoa. If the wage differential between American Samoa ($3.60 per hour) and the Andean countries ($0.70 per hour) is also considered, it is reasonable to conclude that American Samoa will not be able to fairly compete against Andean competition if U.S. tariff rates are reduced or eliminated.”
“Fleet capacity is also another important consideration. The Andean countries have the capacity to expand their fishing fleets if provided with the incentive to do so. Additionally, there is no barrier to prevent the Andean countries from bringing fish in from the Western Tropic Pacific for processing. Japan, Thailand, Taiwan, to name a few, could ship frozen tuna loins to the Andean countries for final processing and thereby defeat the intent of U.S. Andean trade which is to create jobs and build capacity in the Andean region.”
“Simply put, duty-free treatment for canned or pouch tuna products poses a tremendous threat to the stability of the U.S. tuna and fishing processing industries and to the economy of American Samoa. Although the pouch tuna business is currently estimated to be about 6% of the total tuna business, conservative estimates suggest that the pouch business will grow three, five, and ten years at 75%, 50%, and 25% respectively. This equates to 8% share by 2005, 12.2% by 2007, and about 15.4% of total U.S. tuna trade by 2012.”
“Given these eventualities, I have asked the ITC to make a recommendation to the USTR to keep in place what Congress agreed to last year during the Andean trade debate and that is to exclude albacore tuna from preferential trade treatment, exclude canned tuna from preferential trade treatment, and include a rules of origin provision on any and all pouched tuna permitted to enter duty-free.”
“I believe these exclusions and inclusions should apply to both the Andean and Panama trade agreements and any other agreements that may be considered by the United States. I especially believe rules of origin are necessary to protect our U.S. tuna fishing fleet which is based in the Western Pacific Tropic. There are no fishing licenses left in the Eastern Pacific Tropic.”
“However, the Spanish fishing fleet, which is subsidized by the government of Spain, is alive and well and fishing for lightmeat tuna in the Eastern Pacific Tropic. Japan and Taiwan are well at work transshipping albacore tuna to Andean canneries. I am concerned about these developments because I do not believe trade agreements should provide backdoor benefits for non-beneficiary countries. In fairness to the U.S. tuna boat owners, in fairness to American Samoa, in fairness to the Andean countries, I believe rules of origin must be included in any U.S.- Andean free trade agreement and in any U.S. – Panama free trade agreement and I believe canned tuna and albacore packed in any form should be off the table for both agreements.”
“At the end of the day, it is the people of American Samoa who will suffer economic loss as a result of on-going trade agreements which include preferential treatment for canned tuna. More than 5,000 jobs and 80% of our economy are at stake and this is why I will not rest until American Samoa’s future is protected for generations to come,” the Congressman concluded.