NCC: “Trade relations with Russia will be a boost to the US”

In an op ed appearing on The Hill’s Congress Blog, National Chicken Council President Mike Brown outlined why authorising permanent normal trade relations (PNTR) for Russia is a policy that will spur job creation, boost economic growth and be budget neutral at the same time.

Members of the World Trade Organization (WTO) formally approved late last year Russia’s terms for membership in the organisation during a three-day meeting of the WTO’s ministerial conference in Geneva. Russia will take its seat at the WTO 30 days after notifying the organisation that the Russian Duma has ratified the membership terms.

“But for US companies to benefit from Russia’s accession, it will be necessary for Congress to permanently remove Russia from the Jackson-Vanik amendment to the Trade Act of 1974 and authorise the president to extend PNTR to Russia,” Brown said.

Jackson-Vanik requires Russia and seven other former Soviet states and non-market economies to comply with free emigration policies before enjoying normal trade relations with the United States. Since 1994, the United States has certified annually that Russia complies with the amendment’s provisions and has conferred normal trade relations (NTR) status.

Brown continued, “In Russia, retail food and beverage sales are forecast to increase in real terms from just over $200 billion in 2010 to more than $240 billion by 2014 – a 20% increase. This is good news for US food exporters as imports are expected to meet some of this growing consumer demand. But while Russia is home to 142 million consumers and maintains the world’s eleventh largest economy, it is the largest economy not yet formally subject to the global trading rules of the WTO.”

Russia at times in the past has used arbitrary sanitary and phytosanitary (SPS) actions that lack scientific justification to limit or even halt poultry and meat imports from the United States.

“Without the ability to use WTO’s dispute settlement procedures and other related mechanisms, the United States will be at a very significant disadvantage if Russia chooses to evoke bogus SPS measures against US poultry,” Brown noted. “As a member of the WTO, Russia is obligated to bind its agricultural import tariffs and tariff-rate quotas (TRQs). But, if Russia misuses SPS provisions, the tariff bindings and TRQs will become a secondary concern. Other world poultry competitors will undoubtedly step up and try to replace the United States if the Russian market is disrupted for US poultry exports.

“The National Chicken Council urges Congress to approve PNTR for Russia by mid-2012 to help assure the United States can continue to compete in the Russian poultry market,” Brown said. “Exporting $300 million of poultry to Russia annually will provide better incomes for more US workers and additional poultry to be produced by a growing number of family farmers across America.”

He concluded, “A vote for Russia PNTR is a vote for US job creation and economic growth. It makes no sense for the United States to lose access to the world’s eleventh largest economy over an outdated law.”

A copy of the full op ed is available on the The Hill’s website here.