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July 9, 2003 The Honorable Bill Frist, Majority Leader (Sent to the full Senate) United States Senate S-230, The Capitol Washington, DC 20510 The Honorable J. Dennis Hastert (Sent to the full House) The Speaker U.S. House of Representatives H-232, The Capitol Washington, DC 20510 Dear Mr. Majority Leader/Speaker: The undersigned organizations urge your support and vote for the Free Trade Agreement (FTA) with Chile. The U.S.-Chile FTA, provides new market opportunities for U.S. agriculture products and resolution to outstanding trade concerns that U.S. producers have experienced with Chile. Over 75 percent of U.S. agriculture products will enter Chile duty free within four years of implementation of the agreement with all duties on U.S. products being phased out over 12 years. Trade sensitive commodities have been provided special safeguard provisions to help protect U.S. producers from sudden surges in imports from Chile and many have also been provided the longest period of tariff phase-out, 12 years, under the FTA. This will provide those trade sensitive commodities the opportunity to adjust for the period when all tariffs will be eliminated. Concerns that U.S. agriculture had regarding trade with Chile have been addressed. Chile committed to eliminate the use of its unfair price band mechanism over a 12-year period. The price band system allowed Chile to insulate its producers and processors by levying a variable tariff when the world price for any commodity fell below a Chilean calculated reference price. The FTA also eliminates the use of export subsidies on agricultural trade, a major principle U.S. agriculture is working to achieve in WTO negotiations. While export subsidies are eliminated, the United States preserved its rights to respond to third countries that may use export subsidies within the Chilean market to displace U.S. products. Finally, the United States and Chile have worked to address many Sanitary and Phytosanitary (SPS) measures that had previously prevented U.S. products from gaining true access to the Chilean market. We are pleased that resolution was found on issues regarding meat and dairy inspection and acceptance of U.S. meat grading standards and that both sides are committed to continue working over the next two years to resolve important SPS issues on U.S. poultry products. Chile currently provides preferential access to other trading partners through 16 other FTAs. It is time to provide U.S. agriculture that same treatment. U.S. agricultural producers under the Chile FTA will have as good or better access than the European Union or Canada, both FTA partners with Chile. It is important that Congress act soon in support of fair and open trade with Chile. We urge your support for the U.S.-Chile FTA and encourage quick action from Congress on its approval. Sincerely, Altria Group American Farm Bureau Federation American Feed Industry Association American Meat Institute American Soybean Association Biotechnology Industry Organization Blue Diamond Growers CoBank Corn Refiners Association Distilled Spirits Council of the United States Grocery Manufacturers of America National Association of Animal Breeders National Barley Growers Association National Cattlemen's Beef Association National Chicken Council National Corn Growers Association National Grain Trade Council National Grange National Milk Producer Federation National Oilseed Processors Association National Pork Producers Council National Renderers Association National Turkey Federation North American Export Grain Association Northwest Horticulture Council The Fertilizer Institute U.S. Canola Association U.S. Dairy Export Council U.S. Wheat Associates USA Rice Federation Western Pistachio Association Wheat Export Trade Education Committee 
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