South Carolina Agricultural Interests Must Be Protected

Last year the Palmetto Agribusiness Council released a study indicating that our agriculture and forestry industries had a combined $33 billion economic impact on South Carolina. As a farmer I’m proud to note that South Carolina agribusiness accounts for almost 200,000 direct and indirect jobs with payrolls totaling approximately $7.4 billion. Clearly, agribusiness is big business in our state and must be protected.
As such, there is a potentially destructive piece of legislation coming out of Canada that must be addressed. Initially drafted as a health initiative, C-32 has a well-intentioned goal of reducing youth smoking by banning the production, marketing and sale of “flavored” tobacco in Canada. While I have no problem with the bill’s intent, its implementation is cause for concern if it is passed as written. The problem is that “non-characterizing flavors” we use as additives in the production of most of our tobacco are included in C-32’s definition of “flavoring.” This will essentially ban American tobacco from being sold in Canada – thus destroying the tobacco trade between our countries and resulting in numerous job losses throughout South Carolina and across the United States.
Tobacco is still a top 10 cash crop in South Carolina worth an estimated $71 million to the state. We rank second nationally in flue-cured tobacco and fourth in all types of tobacco production. This specific commodity is our state’s fifth largest export and has a cash value of almost $60 million. Particularly during these tough economic times it would be irresponsible to not fight for these jobs and associated revenues.
There is also a much larger concern that this targeting of American grown tobacco could very well be a violation of the WTO’s Agreement on Technical Barriers to Trade. This provision prohibits technical regulations that are more trade restrictive than necessary to fulfill a legitimate health objective. It seems apparent that C-32’s overly broad definition of “flavoring” falls into this category. Additionally, this proposal raises legitimate questions about Canada’s compliance with its national treatment obligation in the General Agreement on Tariffs and Trade (GATT) to the extent that the measure discriminates against imported American Blend cigarettes in favor of “like” domestic Canadian cigarettes. Whether intentional or not – and whether you support the tobacco industry or not – this legislation could easily set a precedent in which other American commodities are targeted (by both Canada and other countries with which we have trade agreements) while simultaneously straining relations with our trading partners.
From what I understand there are a variety of simple amendments – similar to wording adopted in comparable legislation in other countries – that could be drafted and inserted into the bill in order to address the trade concerns presented while still accomplishing the proposal’s legitimate health objective.
With an unemployment rate hovering near 11 percent we cannot sit idly by and allow legislation to pass that will cost South Carolina more jobs. I’m afraid this legislation will do just that. It has the potential to adversely affect the tobacco industry in the short term and any number of other commodities that our state exports in the long term. This would of course have a detrimental trickle down affect on suppliers as well. This is not simply about tobacco – it’s about protecting agribusiness.
It’s my hope our Congressional Delegation and other officials in Washington will take the necessary steps to help ensure the trade agreements we have in place are adhered to and push to have this legislation rewritten so as to protect our vital agricultural markets.


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