Colombia Min: New US congress less likely to clear FTA
Dow Jones Newswires 11-09-06
Colombia Min: New US Congress Less Likely To Clear FTA
By Diana Delgado, Dow Jones Newswires
BOGOTA -(Dow Jones)- The victory of U.S. Democrats in Tuesday’s mid-term elections will make more difficult the approval of a free trade agreement between Colombia and the U.S., the Andean country’s Commerce and Industry minister said.
"We will have a more complex job ahead of us," Jorge Humberto Botero, told La W radio station. "But this isn’t a tragedy; neither it’s the apocalypse," he added.
Colombian and the U.S. negotiators reached an agreement on free trade in February and the countries are expected to sign a pact on November 22. Legislatures of both countries will have to ratify the text for the agreement to kick in.
The Democratic Party won majorities in the House of Representatives and the Senate on Tuesday’s elections, taking control from the Republicans.
Richard Francis, sovereign debt analyst with Standard & Poor’s, said the ratification of the FTA will be more difficult with the Democrats wresting control of both chambers.
"Republicans are more free-trade friendly. The outlook, therefore, is not as good as it was (before)," he said.
The U.S. government negotiated and sealed free trade agreements with Colombia and Peru to replace the Andean Trade Preferences Act and Drug Eradication Act, or ATPDEA, granted to help those countries’ economies diversify from the production of coca leaf, the raw material for cocaine. The new agreements will extend the benefits to new products and will open the Andean markets to U.S. exports.
Dan Griswold, director of the Center for Trade Policy Studies at the Cato Institute, said early this week the passage of the Peru and Colombia free trade agreements could be in jeopardy, with the Democrats winning both chambers.
With the ATPDEA set to expire on Dec. 31, Colombian President Alvaro Uribe will travel to Washington on Monday to ask legislators to prolong the trade preferences, Botero said.
ATPDEA is pivotal for exports of leather goods, textiles, clothes and flowers, among others, which have been enjoying a tariff-free access to the U.S. since November 2002.
"The emphasis of Uribe’s visit to Washington is the extension of the ATPDEA," Botero said. "The expiration of the ATPDEA will be extremely harmful for the country," he added.
Uribe is slated to meet Sen. Max Baucus, D-Mont., the top Democrat on the Senate Finance Committee, and Charles Rangel D-N.Y., according to a press release from the Colombian embassy in Washington. Uribe will also meet with U.S. Trade Representative Susan Schwab.
Separately, Botero, who is expected to leave his post by year’s end, hinted at his possible successor. Luis Guillermo Plata, director of the government’s promoting agency, Proexport, and Hernando Jose Gomez, Colombia’s top FTA negotiator, have been shortlisted to become the new trade minister.
"It’s up to the President to say who he is going to appoint," Botero concluded.
