Should Tobacco be Included in Free Trade Agreement?





By: Joe Schuler, Staff Member

In November 2011, leaders from nine countries reached an agreement on a broad outline for a Trans-Pacific Partnership.[1] The announced purpose of the agreement was to enhance trade between the partner countries, promote innovation, economic growth, and retain and create jobs.[2] The countries involved are Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, Vietnam, and the United States.[3]

Because the agreement was in the form of a broad outline, it necessarily left details open to further negotiation. One such detail is the scope of the agreement, namely whether tobacco will be covered or excluded. This issue has led to a sharp debate among tobacco farmers and manufacturers, and public health advocates. 

Organizations like the Campaign for Tobacco-Free Kids and the American Medical Association argue that tobacco should not be included in the ban, meaning member nations would remain free to impose tariffs on tobacco imports.[4] They argue that exclusion would support the worldwide campaign to reduce smoking.[5]  On the other hand are tobacco farmers who fear the economic consequences of being left out.[6]

Today’s tobacco farmers rely more heavily on exports than ever before, selling the majority of their crop overseas.[7] More than 80% of Kentucky’s tobacco crop is exported to other countries, which the U.S. Department of Agriculture estimates amounted to more than $238 million in 2010.[8] It seems clear that growers and manufacturers alike are fearful that, as tobacco use continues to decline domestically, they must increasingly rely on exports.

The issue has received the attention of more than 50 U.S. Senators and Representatives of tobacco-producing states, who signed letters expressing their concerns to U.S. Trade Representative Ron Kirk.[9] Senate Minority Leader Mitch McConnell, R-Ky., urged Kirk to consider the economic impact an exclusion would have on the state and national economies, citing Kentucky’s 9.5 percent unemployment rate.[10] The Kentucky General Assembly has also weighed in, with both the Republican led Senate and Democrat led House approving a resolution supporting the inclusion of tobacco and tobacco products.[11]

The General Assembly, and others, argue that the U.S. should abide by its long-held policy of comprehensive trade agreements, and that no agricultural products or commodities should be removed due to public policy.[12] Health groups have countered that the U.S. has signed onto an international treaty to reduce tobacco use.[13] That means that this debate is likely to continue to heat up until the full terms of the agreement are announced, and when that happens it is sure to have major policy implications.


[1] Press Release, Office of the US Trade Representative, Trans-Pacific Partnership Agreement (November, 2011), available at http://www.ustr.gov/about-us/press-office/press-releases/2011/november/trans-pacific-partnership-leaders-statement.
[2] Id.
[3] Id.
[4] James R. Carroll, Tobaccos status in trade deal contested; Kentucky growers urge crops inclusion, Courier-Journal, March 14, 2012, available at http://www.courier-journal.com/article/20120313/NEWS01/303090146/Tobacco-s-status-in-trade-deal-contested-Kentucky-growers-urge-crop-s-inclusion?odyssey=tab%7Cmostpopular%7Ctext%7CFRONTPAGE
[5] Id.
[6] Franco Ordonez, Tobacco Growers fear trade deal will harm exports, Sacramento Bee, Feb 28, 2012, available at http://www.sacbee.com/2012/02/28/4297695/tobacco-growers-fear-trade-deal.html.
[7] Id.
[8] Id.
[9] Id.
[10] Id.
[11] Supra, note 4.
[12] Id.
[13] Id.