December 29, 2013

Outcome of trade talks splits state

A proposed new international agreement has implications for Maine companies that compete with and sell to Asia.

By Kevin Miller kmiller@pressherald.com
Staff Writer

(Continued from page 2)

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New Balance, which manufactures athletic shoes in Maine, is the only shoe company in favor of tariffs.

2002 file photo/The Associated Press

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Maine wild blueberries are ready for harvesting at the Dolham Farm in Warren in this file photo. The state's growers would likely benefit from the elimination of trade tariffs.

2012 file photo/The Associated Press/Robert F. Bukaty

Additional Photos Below

U.S. Rep. Mike Michaud, a Democrat who represents Maine’s 2nd District, said a longer-term phase-out of 25 years would give New Balance time to prepare for the transition. While not common, such extended phase-out periods have been applied to other tariffs.

“It’s not that we are saying that you can never eliminate the tariff,” said Michaud, a vocal critic of free trade agreements. “The question is how can you do it in a way that protects manufacturing jobs here in the U.S.?”

Both sides of the issue have been lobbying King and Sen. Susan Collins, a moderate Republican who has supported some past free trade deals but voted against others. Like Michaud and King, Collins has been urging Froman’s office to shield domestic shoe manufacturing jobs from the impacts of any deal.

“Sound trade policy is imperative to maintaining and increasing the number of good manufacturing jobs in Maine and the rest of the United States,” Collins said in a statement. “I am confident he will work to negotiate aggressively and implement a trade policy that honors the commitment of the hardworking employees at New Balance who fulfill their end of the bargain by performing their work with painstaking precision and quality control.”

GOOD FOR BLUEBERRIES, SEAFOOD

Other Maine industries would likely benefit from the elimination of tariffs.

Cherryfield Foods in Washington County and its sister company in Nova Scotia, Oxford Frozen Foods, already export a significant amount of wild blueberries to Europe and Asia. Oxford CEO David Hoffman said his company and Cherryfield are often at a competitive disadvantage now because Chile – a major exporter of fruits and vegetables – already has no-tariff agreements with some countries in the Pacific region.

About 50 percent of Oxford’s sales are overseas exports, with Europe and Asia roughly equal but Asia growing in share as income levels rise in the region, Hoffman said.

Maine and eastern Canada produce the vast majority of the world’s wild blueberries, meaning any new markets would likely benefit the rural communities that support the industry, Hoffman said. “It is important for the growth of the economy in wild blueberry-producing areas,” he said. “So it is a great opportunity if these tariffs can finally be taken down.”

Asia is also a booming market for America’s commercial fishing fleet and seafood dealers.

Exports account for about 55 percent of sales at Calendar Islands Maine Lobster Co., a Portland-based company that ships “gourmet Maine lobster fare” around the world.

With the ongoing economic troubles in Europe, Asia has emerged as another market for Maine fishermen, said Emily Lane, the company’s vice president of sales. The United States already has a free trade agreement with South Korea.

“It’s opened up opportunities for Maine companies to do business with South Korea and build long-term partnerships,” Lane said.

LABOR LEADERS SKEPTICAL

One criticism often levied against free trade deals is that they reward countries with subpar environmental and labor laws. Opponents, including many in the U.S. labor union movement, contend that the agreements remove trade barriers but do not require adequate upgrades to those nations’ labor and environmental laws.

“The evidence is that free trade simply pits Maine workers and Maine businesses against workers in countries that do not have the same standards,” said Cynthia Phinney, president of the Maine Fair Trade Campaign.

Phinney and other groups suggest that the Trans-Pacific Partnership goes far beyond free trade by attempting to rewrite corporate intellectual property and patent laws, including changes that could allow pharmaceutical companies to block the introduction of lower-cost generic drugs.

Democratic U.S. Rep. Chellie Pingree, who represents the 1st District, is also a vocal skeptic of free trade agreements. Twenty years after implementation of the North American Free Trade Agreement, Pingree questioned whether such pacts adequately protect Maine workers and the environment.

“At this point, we know very little about what is in [the TPP], so I start with a heavy amount of skepticism,” said Pingree,

That latter statement, which is echoed by Phinney and other critics, reflects the belief that the secrecy surrounding the negotiations – which are closed to the press and to the public – ensures that no one knows what is in the deal until it is done.

Kevin Miller can be contacted at 317-6256 or at:

kmiller@pressherald.com

Twitter: @KevinMillerDC

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Additional Photos

click image to enlarge

A Fairchild fabricator inspects a wafer at the plant in South Portland. Semiconductor manufacturers do a lot of business in Asia and should benefit from the elimination of tariffs.

2003 Telegram photo/John Patriquin

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A sternman holds a lobster caught off South Bristol. America's commercial fishing fleet and seafood dealers favor a trade agreement because Asia is a booming market.

File photo/The Associated Press/Robert F. Bukaty

 


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