Sunday, July 01, 2007

One Step Closer

The Peru-United States free trade agreement, on which I've previously posted here, here and here, moved one step further along last week, but now will probably not be passed by the US congress before the end of the year.

On Wednesday 27 June, the Peruvian congress passed amendements to the original agreement which had been negotiated by US Democratic leaders with the Republican administration. But according to Bloomberg News, Democrats have now put off voting on the Peru (and Panama) agreements until those countries 'revamp their laws to comply with [the amendments'] new labor and environment standards'.

The final text of the amendments had been agreed only a few days before the Peruvian vote. Activists who had previously criticised the lack of transparency of the deal were not impressed with the results. Consumer-rights group Public Citizen issued a press release stating that:

The legal text of changes to several Bush-negotiated NAFTA expansion agreements released today confirms that the essential changes listed by labor unions, environmental, consumer, faith and family farm groups as necessary to avoid their opposition to the free trade agreements were not made.

Frustratingly, neither the groups making criticisms nor the official sources such as the US Trade Representative's Office have posted the actual legislative text. I've posted a comment on blogger David Sirota's website, asking him to link to the full text.

Nevertheless, it appears a majority of the Democratic caucus agrees with the criticisms, which is what has caused the decision to delay the vote. According to the news feed, 'it is now planned that Rep. Charles Rangel, chairman of the House Ways and Means Committee, will lead a delegation of lawmakers to those countries in August to help them with the changes'.

It's unclear how this 'help' will be given, nor what actual legislative changes Peru and Panama will have to make. The intentions may be good, but it all seems a little overbearing and patronising.

The terms of the debate also remain US-centric. While most of the attention from the American NGOs and grassroots Democrats has been on labour and environmental standards (with some attention to the onerous intellectual property requirements of the original agreement) there's been very little mention of what is probably the biggest concern in Peru -- the destablising effect of the agreement on small agricultural producers. No US politican has suggested any strategy to mitigate or assist with those issues.

As an interim measure while things are sorted out, the US Congress extended its unilateral trade preferences for Andean nations (also including Colombia, Ecuador and Bolivia) for another eight months.

Meanwhile, agreements were signed with Panama, South Korea, and Colombia in a last-minute flurry of activity before expiration of President Bush's 'fast-track' authority to develop trade agreements without congressional input. The Panama agreement looks set to follow a similar course to Peru's, but Congress is unlikely to consider the Colombia one in the near future, while the there is broad opposition to the South Korea deal, including from Hilary Clinton.

Then, when the Bush fast-track authority expired at midnight on 30 June, the Democrat-controlled congress refused to renew it, meaning that the US is unlikely to start any new trade negotiations until at least after the November 2008 presidential elections.

Predictably, the likes of the Heritage Foundation lamented the imminent disappearance of fast-track authority, asseting that:

Freer trade policies have created a level of competition in today's open market that leads to innovation and better products, higher-paying jobs, new markets, and increased savings and investment...

These agreements play a critical role in maintaining American competitiveness and economic prosperity, spreading freedom around the world and fostering economic development in poor countries.

However, there's a growing body of opinion from many sides of the ideological spectrum that such statements are, at best, gross oversimplifcations. This is something I'll explore in some future posts.

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