After years of delay, the U.S. Congress on Wednesday approved the free trade agreements - the largest since 1994's North American Free Trade Agreement (NAFTA) - in a rare instance of bipartisan cooperation.
The deals will cut tariffs and open up markets between the United States and South Korea, Colombia, and Panama.
And while the political arguments focused on the deals' impact on jobs and the U.S. economy, U.S. corporations will emerge as the real winners.
That's why Caterpillar Inc. (NYSE: CAT), a frequent beneficiary of past free trade agreements, was one of the first to applaud the deals.
"Once these agreements go in effect, Caterpillar products produced in Illinois and Mississippi and the Carolinas will be able to be exported to Colombia, Panama and Korea duty-free," Bill Lane, the Washington directorfor the heavy equipment maker, told NPR. "That's a big deal."
The Boeing Co. (NYSE: BA) was equally pleased.
"When commerce increases, downstream that turns into aircraft orders. More movement of people and certainly of goods opens up more opportunity to sell aircraft," Ted Austell, a vice president at Boeing, told Reuters.
Many WinnersU.S. President Barack Obama, who had strongly urged Congress to approve the free trade agreements, said a government study showed the South Korea deal alone would benefit machinery and equipment makers, pork and beef producers, and the chemical and plastic products industries.
The sector with the most to gain in the Panama and Colombia deals is the agricultural industry, which had complained that the delay in approving the agreements - negotiations begun under the Bush administration - was costly.
"We can't underestimate how much U.S. agriculture has lost out," Devry Boughner, director of international business relations for Cargill Inc., told Reuters. "Corn, soybeans and wheat exports from the U.S. have gone from a 78% market share in the Colombian market to 28%, owing in part to the fact that Canada got to Colombia first."
Dozens of large corporations and business groups have actively lobbied Congress for years to pass the free trade agreements to gain access to new markets or make their products cheaper and more competitive in existing markets.
Some of the other large U.S. companies that lobbied for the South Korea deal include AT&T Inc. (NYSE: T), Chevron Corp. (NYSE: CVX), Johnson & Johnson (NYSE: JNJ), Microsoft Corp. (Nasdaq: MSFT), Pfizer Inc. (NYSE: PFE), Prudential Financial Inc. (NYSE: PRU) and QUALCOMM Inc. (Nasdaq: QCOM).
The Latin American Trade Coalition, which supported both the Colombia and Panama free trade agreements, included Caterpillar, General Electric Co. (NYSE: GE), Wal-Mart Stores Inc. (NYSE: WMT), Citigroup Inc. (NYSE: C), International Business Machines Corp. (NYSE: IBM) and Oracle Corp. (Nasdaq: ORCL).
Why so much corporate interest in free trade agreements?
"Let me just put it this way," explained Caterpillar's Lane. "About eight years ago they passed the Chile free trade agreement. Caterpillar exports to Chile tripled. These agreements have real-life implications and what they've all done is increase U.S. exports."