Back in the 1970s, I was driving along a freeway near Columbus, OH, in midwinter. The highway was covered with several inches of snow and the pavement under the snow was icy, so it was good to see a salt truck and snowplow working ahead of me on the road.
The only problem was that the salt truck was in front and the plow in back. Perhaps the city was testing the effects of higher levels of sodium chloride on the grass along the freeways in the spring. Similar questions arise in my mind as I see the debate on the continuance of the Andean Trade Preference & Drug Eradication Act, which expires June 30.
Ecuador now stands alone in the program: Colombia and Peru now have Free Trade Agreements in effect with the United States and Bolivia was already eliminated.
As a U.S. citizen who has lived in Ecuador for nearly 25 years, and been involved in the floral industry there when it was only 4 percent of its present size, I am concerned that just as the salt that could have been so useful was plowed off the road, a program that has yielded tremendous benefits at a low cost to the United States may meet a similar fate.
Why should ATPDEA be continued (or at least replaced by the General System of Preferences for roses)? There are three key reasons:
• It works. The United States at its peak never reached 500 acres of greenhouse roses but Ecuador alone has 5,500 acres today and only supplies about 25 percent of the cut roses imported into the United States. Less than 25 percent of the farm price stays in Ecuador; the vast majority of value added is added in the United States.
Without the volume and competition these flowers provide in the market, supply would shrink and prices would climb, putting further pressure on mass market and other retail floral sales. Estimates are that each cut-flower industry job in Ecuador and Colombia creates one U.S. cut-flower job. That means employment has grown here. The ATPDEA has curbed drug smuggling and illegal immigration from Ecuador.
• ATPDEA is not a gift from the United States; it is part of a bilateral or multilateral trade relationship between countries. I work in part for the only remaining greenhouse rose breeders in the United States. We can import duty-free into Ecuador our mother plants, test codes, fertilizers, agricultural chemicals, plastics, etc. Although it is not a two-way agreement at the present time, there are parallel agreements providing reciprocal benefits.
• Domestic production cannot meet the gap. There are now fewer than 185 acres of greenhouse roses in all 50 states (mainly in California) and they supply less than three percent of the market. Production cost and variety differences, head size and stem length limit U.S. greenhouse rose growers to niche markets, which they can continue to fill.
California produces more than five times as many non-tropical flower species as Ecuador, and Ecuador cannot compete in the production of most of these species.
Although work continues on ATPDEA renovation, prospects seem dim. The alternative, the Generalized System of Preferences, is a more complicated and general program, but may be the most viable option now. I hope voices of reason will prevail for the good of the entire flower industry in the United States and Ecuador. Let’s not plow our salt — and profits — to the side of the road.
Dean E. Rule is general manager of Conectiflor in Quito, Ecuador, representing International Rose Breeders, Terra Nigra and Jan Spek Rozen. He has been involved in the cut-flower industry in Ecuador and the United States for 25 years. He can be reached at email@example.com.