story by Ben Pollock, special to The City Wire
Fugitive Edward Snowden, Ecuadorian roses and Sam’s Club are yet more examples of the tangled webs created by international politics and international trade.
The trade tiff is small in terms of dollars and it’s possible that consumers will see no impact, but the incident is a reminder of the sometimes surprising connections between world events and local retail shelves.
Snowden, while on the lam and wanted by the U.S. for espionage, was offered refuge by Ecuador and Russia in recent weeks, angering public officials.
U.S. Sen. Robert Menendez, D-N.J., and chairman of the Senate Foreign Relations Committee warned Ecuadoran President Rafael Correa – and Russia – that granting Snowden asylum could jeopardize trade agreements. On June 29, Vice President Joe Biden asked Correa to reject any request for Ecuadoran asylum, according to CBS news.
But Ecuador renounced a trade pact with the U.S. in late June and U.S. lawmakers allowed the treaty to expire before taking their recess Aug. 2. Without the treaty, tariffs on certain Ecuadoran goods will rise, as high as 14.9% for broccoli and 6.8% for certain types of flowers.
The U.S. imports roughly $149 million of cut flowers from Ecuador each year, the majority of which are roses.
According to SamsClub.com, there are 442 different flowers for sale. Some 85% of the roses listed on the site is sourced from Ecuador. There were 62 different varieties of Ecuadoran roses on the site. Other roses offered were predominantly from Colombia.
"Sam’s Club merchants are aware of the tariff issues and continue to provide the premium quality Ecuadorian roses at the great value and seven-day freshness guarantee that our members rely on,” said Carrie Foster, Sam’s spokeswoman in Bentonville.
On Wednesday (Aug. 7) nearly all of the Fayetteville Sam's Club floral department's inventory came from Colombia. Only two varieties came from elsewhere. The lilies and gladiolus were U.S. grown.
Dan Hendrix, president and CEO of the Arkansas World Trade Center, said other Arkansas imports from Ecuador include metal spoons, plastic pallets and retainer rings, but quantifying the individual statistics is difficult as they are reported in aggregate numbers.
“The import data is very difficult to track to specific states and covers only waterborne commerce. We know we are receiving cut flowers from Ecuador but probably through a third-party expeditor," Hendrix said.
An alternate route to avoid tariffs on certain goods from Ecuador by placing them in the Generalized System of Preferences probably won't pass muster. The U.S. Trade Representative's office said a decision on such requests had been deferred, according to Reuters.
Trade is a two-way street and on the flip side, Arkansas businesses exported $15.2 million in goods to Ecuador last year. Half of those sales were agricultural and the remainder were divided among chemicals, primary metal manufacturing and non-electrical machinery.
The treaty that has facilitated trade between the U.S. and Ecuador went into effect in 1991. Then-President George H.W. Bush signed the Andean Trade Promotion and Drug Eradication Act, which allowed Bolivia, Colombia, Ecuador and Peru to sell goods to U.S. companies without paying duties, to discourage cocaine production.