Bush Used Sept. 11 To Push Ahead FTAA

by Diego Cevallos

They add, however, that Latin America and the Caribbean have little to gain from the trade deal in the form in which the draft treaty now stands.

Evaluations of the attacks have largely ignored the impact on the FTAA, even though "it is one of the most important consequences for the region," German de la Reza, an expert on integration matters, told IPS.

A narrow majority of lawmakers in the U.S. House of Representatives set aside their reluctance and agreed on Dec. 6 to grant President George W. Bush "fast-track" authority for negotiating free trade agreements -- considered one of the keys for putting the FTAA into effect.

Under fast-track, the U.S. Congress can only vote up or down on trade deals negotiated by the executive branch, without having the option of modifying them. Although approval of fast-track is still pending a vote in the Senate, analysts say it is well on its way through Congress.

"Fast-track has been stalled since 1994, and there was a sense of pessimism regarding its eventual approval, but the climate of patriotism generated by the attacks drastically changed that outlook," said De la Reza, a professor at Mexico's National Autonomous and Metropolitan universities.

Fast-track authority will help Bush live up to his promise to see the FTAA in effect by 2005 or even earlier, according to what was agreed at the third Summit of the Americas, which drew the leaders of 34 countries in the region together in Quebec, Canada last April.

Since the 1990s, the United States has been the driving force behind the creation of a hemisphere-wide free trade area, which will link all countries in the Americas with the exception of Cuba.

A number of governments in Latin America and the Caribbean saw the U.S. Congress' reluctance to grant fast-track authority as a sign of a lack of interest by Washington in moving towards the FTAA.

According to De la Reza, the hemisphere-wide agreement is aimed mainly at slashing import duties, which will not bring significant benefits for Latin America if what the region is seeking is access to the U.S. market for its exports.

U.S. tariffs currently average three percent, and are expected to drop below two percent in 2004, compared to an average of 10 percent in Latin America -- which means this region will do most of the yielding in that terrain, the analyst pointed out.

The draft treaty of the FTAA indicates that non-tariff protectionist barriers used by the United States to defend its market are not up for discussion.

The FTAA model is designed to provide strong benefits for the United States and few for the rest of the Americas, said De la Reza, who coordinates a research team on integration in Mexico and Sweden.

Unlike the integration model followed by the European Union, social aspects and questions of political, cultural and monetary integration as well as migration issues and the environment do not figure on the agenda, or have been relegated to a secondary level, in the FTAA negotiations.

"We are looking at a limited form of trade integration, because the FTAA, as it has been proposed and is being negotiated," refers only to tariffs, Otto Boye, secretary of the Latin American Economic System, said last August.

At that time, Boye pointed out that the FTAA negotiations were moving steadily forward, while the public in Latin America knew little about the agreement, and was not making much of an effort to discuss it either.

The final stage of the FTAA talks, in which only government and business representatives have taken part up to now, will be hosted by Mexico in 2003.

De la Reza believes that now more than ever, due to the effect of the terrorist attacks on New York and Washington, it is not feasible to incorporate non-trade questions into the FTAA negotiations.

He cited the example of Mexico, which prior to the attacks had successfully pressed the United States to place migration issues on the agenda. However, they were later pushed to the back burner by questions of security along the border and the search for formulas to keep trade flowing.

Since January 1994, Mexico, the United States and Canada comprise the North American Free Trade Agreement (NAFTA), which has served as a model for designing the FTAA.

"The most important thing for the continent that has occurred this year, on the trade front, is the granting of fast-track authority (pending Senate approval) to Bush, because that means the FTAA has cut its last moorings loose," said De la Reza.