Using Ethanol as a Fuel to Reenergize Free Trade Area of the Americas Negotiations


Currently the United States imposes a 2.5 percent ad valorem tax along with a 14.27 cents per liter tax on imported ethanol from countries with normal trade relations under the harmonized tariff schedule. However, the United States exempts many countries from this tariff or reduces the tariff under various free trade agreements or initiatives. The issues that resulted in Doha’s failure also caused FTAA negotiations to temporarily stall since both Brazil and the United States wanted certain FTAA issues negotiated at the WTO level. The United States could initiate this process with a discussion of reducing or eliminating its ethanol tariff and adjusting some domestic legislation, thus allowing ethanol to satisfy America’s energy thirst. In addition, a successful ethanol agreement may create many positive effects later in the negotiations and for the Americas. First, it would reduce America’s dependence on oil and potentially improve the United States security interests. An agreement on ethanol would bring issues traditionally left out of free trade agreements into the negotiations and ultimately into the agreement for a FTAA.


Administrative Law | Agriculture Law | Antitrust and Trade Regulation | Economics | Energy and Utilities Law | Environmental Law | International Trade Law | Natural Resources Law | Tax Law

Date of this Version

February 2007