Question

Do you think that CAFTA will have a major impact on the U.S. economy? Why?

Answer 1

The advocates of NAFTA and CAFTA have made large claims about the potential for growth in exports and the number of jobs that will benefit from this. We suggest that exports will grow faster than imports, and that trade surpluses will continue for generations to come. While growing exports are good for the economy, growing imports actually displace domestic production that would support US employment. As was often the case under NAFTA, when agricultural imports rise faster than exports, the result is net drain on farm output and employment.

The U.S. Trade Representative (USTR) has a history of both making exaggerated statements about the advantages of the negotiated deals and exaggerating arguments about the trade partners ' own value and economic potential. The USTR has confirmed that "U.S. In 2003, agricultural exports to the[ CAFTA] region totaled $1.6 billion "(USTR 2005). Nonetheless, according to official statistics from the Department of Commerce, the US only exported $834 million in agricultural products and livestock and livestock products to the country in 2003

U.S. sugar producers say CAFTA would result in an influx of cheap sugar from Central America and move employment from an industry with over 300,000 U.S. employees overseas. (Some economists say that this figure includes employees in jobs that are only marginally related to sugar production; they say that the number of workers directly employed in sugar can be as small as 60,000). U.S. sugar producers receive government subsidies and sugar imports are restricted by quotas. The subsidies mean that Americans pay twice as much for sugar as customers in other countries;