2008-07-24 14:13:03 -

www.researchandmarkets.com - Research and Markets (www.researchandmarkets.com/research/c8aeec/colombia_food_and) has announced the addition of the "Colombia Food and Drink Report Q3 2008" report to their offering.

This Colombian Food and Drink Report provides independent forecasts and competitive intelligence on Colombia's food and drink industry.

On April 10 2008 the US House of Representatives

voted to indefinitely delay the implementation of the United States-Colombia Trade Promotion Agreement. The move effectively delays debate on the politically sensitive free trade deal until after the November 2008 Presidential election and avoids a potentially damaging showdown between the two democratic presidential candidates who have both questioned the merits of free trade. Colombia's food and drink exporters currently enjoy relatively straightforward access to the US under the Andean Trade Preference and Drug Eradication Act (ATPDEA) passed in 2002. However, this agreement will expire on December 31 2008 and the failure to pass the new Trade Promotion Agreement sends a worrying signal that the US may be less open to Colombia's exports under a new administration.

Colombia is currently allowed to ship coffee, fruit, oil and clothing to the US with no duties and the Trade Promotion Agreement, drawn up by US President Bush, would have made this status permanent. In return Colombia would have eliminated tariffs on US goods, and given American firms access to Colombia's services market. However, the act was voted down by the Democrat majority in the House of Representatives with Democrat politicians citing concerns over Colombia's attitude towards union rights and the environment.

The fact that the overwhelming majority (over 90%) of Colombia's exports to the US already enter the country without any tariffs means that there is little for the US to lose by signing the deal, and quite a significant amount to gain. However, the US's free trade agreements have been blamed by many leftwing commentators for the country's current economic woes and the decline in the number of manufacturing jobs in the country. Therefore even a deal which would simply extend an existing agreement and poses no real threat to US manufacturers has become the subject of major controversy.

Trade between the two countries stood at US$18bn in 2007 and the US is Colombia's main trading partner. Failure to agree a new trade agreement with the US could have a massive effect on Colombia's food, drink and agricultural industries. Agriculture currently accounts for nearly 20% of the country's GNP and employs over 30% of the working population. Coffee, bananas and chocolate are all currently exported to the US and if a new administration decided to implement tariffs on these products then the competitiveness of Colombia's producers would be greatly reduced. This would not only deter investment but could even call into question the viability of several existing firms. In addition Colombia's highly developed processed food industry has always had dreams of tapping the lucrative US market and any such moves would have to be indefinitely postponed if new trade barriers are erected.

Companies Mentioned:

-CI Union de Bananeros de Uraba, SA (Uniban)

-Alianza Team (Tecnologia Empresarial de Alimentos SA)

-Nacional de Chocolates

-Postobon

-Grupo Empresarial Bavaria

-Mass Grocery Retail

-Almacenes Exito

-Olimpica

For more information visit www.researchandmarkets.com/research/c8aeec/colombia_food_and

Research and Markets
Laura Wood, Senior Manager
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