Free-Trade Pacts Might Gain Congressional Support, Official Says
Washington - A Bush administration official is optimistic that the U.S. Congress will approve free-trade agreements with Colombia, Panama, Peru and South Korea.
“There is no doubt in my mind that Congress will pass each of them,” said Deputy U.S. Trade Representative (USTR) John Veroneau June 27.
The fate of the administration’s trade plans became uncertain when Democrats, who for years had pressed for including tougher labor and environmental protections in U.S. free-trade agreements (FTAs), took over both chambers of Congress in January. That led to talks between administration trade officials and Democratic congressional leaders on a new bipartisan trade agenda.
On May 10, the two sides announced a bipartisan trade bargain that would make core international labor standards part of all FTAs, including the four already concluded. U.S. trading partners also would have to enforce laws consistent with seven major multilateral environmental conventions.
The deal with Congress paved the way for congressional consideration of all four trade agreements once appropriate amendments were made to the agreed texts of the FTAs with Colombia, Peru and South Korea and certain provisions added to the one with Panama. The deal with Panama was not closed at the time of the congressional bargain.
USTR Susan Schwab announced June 27 that her office had reached agreements on the amendments with Colombia and Peru a few days earlier.
On June 28, the United States signed the final version of the FTA with Panama. It hopes to sign the FTA with South Korea June 30, Veroneau said. The talks with that country still were ongoing when he spoke. Veroneau said he expects Congress to consider the first of the pending FTAs - the agreement with Peru - in July.
When Congress may take up the other FTAs is uncertain. But according to a USTR official, it usually waits for a study by the U.S. International Trade Commission of the impact a trade agreement is likely to have on the U.S. economy before it takes action. Such a study on the trade agreement with Colombia was completed in December 2006, and one on the agreement with Panama is scheduled to be published September 12.
Speaking at the American Enterprise Institute, he said the administration now can start a “full-throttle” campaign to help lawmakers realize that the four FTAs are beneficial to the United States and its trading partners and will advance U.S. values.
But some doubts remain as to whether the administration can win congressional approval for the FTAs with Colombia and South Korea.
Veroneau said the administration officially will submit these deals for congressional approval after “sorting through some additional non-FTA issues.”
Some in Congress are concerned that the trade agreement with Seoul does not sufficiently open the Korean market to U.S. cars and auto parts. Schwab has rejected the critique and said the FTA is a “very strong” one for U.S. automakers. But she warned in mid-June that it is unlikely to be approved unless Korea fully reopens its market to all U.S. beef.
Some lawmakers and U.S. labor unions also have complained that there is a history of violence against labor activists in Colombia. Charles Rangel, the Democratic chairman of the House Ways and Means Committee, which has jurisdiction over trade issues, told reporters June 18 about growing uncertainty in Congress over whether Colombian President Alvaro Uribe is “able to control the violence.”
The four FTAs will be the last ones to be considered by Congress under the Trade Promotion Authority (TPA), also known as fast track, which expires July 1. President Bush has asked Congress to renew it.
With World Trade Organization negotiations stalled again, U.S. trade officials have said they would need a new TPA to be part of increased worldwide efforts to negotiate bilateral and regional trade deals.
In a related development, the House of Representatives passed a bill that would extend trade preferences for Bolivia, Colombia, Ecuador and Peru for eight months. The bill is expected to clear the Senate in time for the president to sign it into law before the current Andean Trade Promotion and Drug Eradication Act expires July 1. The program provides duty-free access to U.S. markets for more than 5,000 products from the beneficiary countries to encourage efforts to combat drug production and trafficking.
The two-year extension called for in the original legislation was opposed by the administration and many Republican legislators, who were concerned that a long-term extension could provide an excuse to delay voting on the Colombia and Peru FTAs.
Veroneau said the eight-month period is long enough to assure stability for doing business in Colombia and Peru but short enough to “focus the mind on FTAs.”
Some lawmakers have opposed the extension of trade preferences for Bolivia and Ecuador because they said the two countries treat U.S. investors unfairly, creating obstacles and nationalizing U.S. firms’ assets.
Veroneau said the shorter extension will provide time for “reflection and further analysis as to what the future holds for U.S. investors in those markets.”