In its last order of business before adjourning for the year, Congress granted Permanent Normal Trade Relations status to Vietnam as part of legislation extending various expiring tax credits. With PNTR, U.S. exporters can take advantage of Vietnam’s accession to the World Trade Organization. (The country will become a WTO member Jan. 11, 2007.)

 Tariff rates for about 75 percent of U.S. agricultural exports to Vietnam, including pork, will decline to WTO-bound duty rates of 15 percent or less. The tariffs on pork variety meats, which are in high demand in Vietnam, will decline from a rate of 20 percent to 8 percent over four years. Tariffs on most other pork products will be reduced by 50 percent in five years.          According to IowaStateUniversity economist Dermot Hayes, the Vietnamese accession deal will increase U.S. pork variety meat exports to the Southeast Asian nation to $16.5 million by 2012 from $3.3 million in 2004 and will raise live hog prices by $0.52 per hog.

Under a market-access agreement with the United States that was finalized in May, Vietnam made numerous improvements to its implementation of WTO rules on sanitary and phyto-sanitary measures and agreed to recognize the U.S. inspection system for pork as equivalent to its inspection system. Additionally, the U.S. will have recourse to WTO dispute settlement mechanisms should Vietnam not live up to any of its obligations, an avenue of recourse that previously did not exist.

Source: National Pork Producers Council