IT Products Have Best CAFTA-DR Growth Potential

Nov. 29, 2006
Manufacturers Alliance report also sees promising investment opportunities.

Implementation of the U.S.-Central America-Dominican Republic Free Trade Agreement (CAFTA-DR) provides American manufacturers with promising trade and investment opportunities, believes Fernando D. Sedano, an economist at Manufacturers Alliance/MAPI, a business and public policy research group based in Arlington, Va.

The CAFTA-DR eliminates regional tariffs on more than 80% of U.S. exports of consumer and industrial goods.

Although only four of the six nations that are party to the free-trade agreement have implemented it so far, U.S. exports increased 16.8% from January to September of this year, while U.S. imports from the region increased 3.2%.

U.S. IT products have the best export potential, with 99% of U.S. exports of electronics and instrumentation having duty-free access under CAFTA-DR, says Sedano. Other promising manufactured exports: capital goods, chemicals, environmental technologies, electrical power generation and distribution equipment, and automotive parts and services equipment.

CAFTA-DR also "gives U.S. companies the right to establish, acquire and operate investments in the region on an equal footing with local investors," adds Sedano.

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