Is the US-Israel Free Trade Agreement Harming America? Myths Versus Facts

Institute for Research: Middle Eastern Policy
Forbes.com
June 1, 2009

WASHINGTON, June 1 /PRNewswire-USNewswire/ -- The US-Israel Free Trade Area (UIFTA) became law in 1985, but ongoing violations of American intellectual property rights and trade laws are fueling heavy losses of American jobs. As the US economy declines many are trying to separate myths from facts about America's first bilateral trade agreement:

Myth: The US Israel Free Trade Area (UIFTA) delivers "mutual benefits".

Fact: Since 1985 US trade with Israel shifted from a surplus to a cumulative $71 billion deficit (adjusted for inflation). The $7.8 billion US deficit with Israel in 2008 equals 126,000 US manufacturing related jobs. UIFTA is the only bilateral pact producing multi-billion dollar losses to the US every year over the last decade.

Myth: UIFTA is supported by US industries and associations.

Fact: During 1984 negotiations seventy-six leading American companies such as Monsanto, Dow Chemical, Sunkist, Hunt-Wesson Foods and organizations such as the AFL-CIO, American Farm Bureau and the US Bromine Alliance testified against the UIFTA. Only seventeen organizations -- most with no direct economic stakes -- testified in favor. More recently pharmaceutical, agricultural and other industry associations have continued to lobby against unfair Israeli trade practices.

Myth: The 1984 UIFTA negotiation process was open and fair.

Fact: The FBI investigated how the American Israel Public Affairs Committee (AIPAC) obtained the classified government negotiation report. In 1984 the Washington Post reported that the "report would give Israel a significant advantage in the trade talks because it discloses how far the United States is willing to compromise on contested issues. Some of the proprietary information, moreover, could help Israeli businesses competing with U.S. companies." The Washington Post was right -- UIFTA and a subsequent epidemic of intellectual property violations cost the US economy billions of dollars.

Myth: The US-Israel Free Trade Agreement strengthens global rules based trade.

Fact: Israel has been on a US violations "watch list" for the past four years. Top industry and government concerns include Internet music and software piracy, industrial espionage targeting US trade secrets and systematized misuse of patented US pharmaceutical innovations by Israeli generic drug exporters in collusion with the Israeli Ministry of Health. Israeli cut diamond exports finance illegal West Bank settlements.

More about the UIFTA at: http://www.IRmep.org/UIFTA

The Washington, D.C. based Institute for Research: Middle Eastern Policy is an independent nonprofit that studies US policy formulation toward the Middle East.

SOURCE Institute for Research: Middle Eastern Policy

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