Business groups lobby to resurrect FTAA

2 November 2005

Business Groups Lobby to Resurrect FTAA

Emad Mekay

WASHINGTON, Nov 2 (IPS) - Dozens of business groups from throughout the Americas are urging regional governments to adopt economic and trade reforms to give a boost to upcoming World Trade Organisation talks and a stalled regional free trade agreement.

Wednesday’s appeal from U.S. Chamber of Commerce and more than 100 other business organisations came in a statement ahead of a meeting of leaders from the 34 members of the Organisation of American States.

The leaders will gather at the fourth Summit of the Americas in Mar del Plata, Argentina on Nov. 4-6, with trade and regional cooperation topping the agenda.

U.S. President George W. Bush is expected to arrive there on Friday with an ambitious trade agenda that will focus on reviving the global trade talks, which began in Doha, Qatar in November 2001, and the so-called Free Trade Area of the Americas (FTAA), both of which are facing strong opposition from developing nations.

The FTAA is designed to be the most far-reaching trade agreement in history. It would tie the economies of the Western Hemisphere into a single free trade area comprising 800 million consumers with a combined gross domestic product of 14 trillion dollars.

But although three drafts of the FTAA have been completed, the talks stalled in 2004 over Washington’s refusal to discuss agriculture tariffs and subsidies. Now, the United States and Brazil — as the co-chairs of the Trade Negotiating Committee — are working to revise the overall negotiation strategy, with much prodding from business groups.

Parallel to the Mar del Plata meeting, some 200 business executives will gather to discuss the role of the private sector and methods to get their trade agenda back on track.

"It is expected that a number of nations will join the United States at this meeting in support of reaffirming the region’s commitment to the FTAA," said Jorge L. Arrizurieta, president of Florida FTAA, a business-public group lobbying for the passage of the trade pact, and which is led by Bush’s brother, Florida Governor Jeb Bush.

"This meeting combined with the prospects of progress in the Doha round in Hong Kong in early December are important steps to reenergising the FTAA in 2006," said Arrizurieta.

In addition to the U.S. business groups like Chamber of Commerce and Florida FTAA, the other signatories to the Wednesday statement include Latin business groups that stand to gain from the free trade deals. These include Brazil’s National Confederation of Industry, Chile’s Confederation for Production and Commerce, the Argentine Chamber of Commerce and the Canadian Chamber of Commerce.

Also prominent are organisations that specialise in global trade, such as the hemisphere’s 24 American Chambers of Commerce, the Mexican Council for Foreign Trade and the Latin American Association of Express Delivery Companies.

"It is important to recall that governments may implement trade facilitation measures and see benefits immediately, regardless of whether other nations reciprocate," the statement said. "Trade facilitation makes our own economies more competitive and spurs the economic growth that drives job creation."

But negotiators admittedly face an uphill task in trying to meet the divergent interests of countries that vary considerably in size, economic capacity, and political interest. While issues like direct investment, intellectual property rights and government procurement are of particular interest to the U.S. companies, Latin American nations want to see a substantial reduction in U.S. agricultural subsidies and tariffs to help their own farmers, many of whom cannot compete with cheap U.S. farm products.

Latin farmers are joining labour groups and other organisations to protest the trade agenda. Thousands marched Tuesday at a "People’s Summit’’ in Argentina ahead of the weekend’s official summit. Many of the protests blamed U.S.-style free trade for worsening conditions for workers and farmers in Latin America.

Criticism of the agenda in Latin America was so intense that the original agenda for the summit, which was to have featured the finalising of the FTAA, was changed and the summit adopted the current theme of "Creating Jobs to Fight Poverty".

Washington also faces resistance at home. It only narrowly pulled off a regional deal with some Latin American countries in July when it signed the Central America Free Trade Agreement (CAFTA, or DR-CAFTA) with Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the Dominican Republic. The deal passed the U.S. Congress by a mere two votes.

Critics of the FTAA say that while it will likely take a prominent place at the summit, they do not expect the meeting to produce a major breakthrough. Without a clear deadline for the completion of the FTAA, or detailed instructions on how to meet this deadline and interim deadlines for specific talks, the agreement will continue as a failure for the trade agenda in Latin America.

"It is obvious, then, that FTAA proponents are well aware of the agreement’s near-death status and will attempt to ’spin’ the events of the Summit of the Americas to depict a revival of the FTAA," said Lori M. Wallach, director of Public Citizen’s Global Trade Watch.

source: IPS