Caterpillar Inc. chairman and CEO Jim Owens last week testified before the United States Senate Finance Committee in support of passage of a Trade Promotion Agreement between the United States and Panama.
“Time and time again, we have seen the benefits of expanding our opportunities for trade,” Owens said. “In 2008 alone, Caterpillar exported more than $16 billion in products from the U.S., supporting tens of thousands of jobs in the U.S. for Caterpillar and our suppliers.”
During his testimony, Owens noted that the Panama Canal Expansion project is one reason duty-free trade with Panama is essential. The expansion is one of the world’s largest public works projects since the Three Gorges Dam was constructed in China. Today, about five percent of all world trade passes through the Panama Canal. With the Canal at capacity and many of the newer, larger ships unable to use the Canal, it takes longer than it should for some U.S. exports to reach overseas markets.
“The TPA with Panama will benefit manufacturing exporters like Caterpillar and American farmers who export crops, because it will reduce the tariffs on U.S. products shipped to this long-time ally,” Owens said. “More than 60 percent of Caterpillar’s sales are outside of the United States, and most of our major competitors are based overseas. We know we can compete and win in the global marketplace, but we must have trade policies that remove foreign trade barriers,” Owens added.
If enacted, a trade agreement with Panama would eliminate tariffs ranging from three to 10 percent on Caterpillar products, benefiting both the company and its customers.
“When such barriers have been lifted, Caterpillar’s track record has been clear, as Caterpillar exports have dramatically increased following passage of all previous Free Trade Agreements,” Owens said. “For example, from the time trade agreements have gone into effect, Caterpillar exports have quadrupled to Canada and Mexico, tripled to Chile and nearly doubled to countries included in the Central America Free Trade Agreement, helping to support jobs at the U.S. facilities that ship products to those countries.”
Caterpillar is headquartered in Peoria, Ill.