Ecuador’s president-elect rules out signing trade pact with US

The Associated Press

December 10, 2006

Ecuador’s president-elect rules out signing trade pact with U.S.

LIMA, Peru: Ecuador’s President-elect Rafael Correa said Sunday that he will not sign a free trade agreement with the United States but will seek extended trade preferences under an anti-drug agreement.

Trade agreement talks between the U.S. and Ecuador derailed in May, after Ecuador canceled the operating contract of California-based Occidental Petroleum Corp.

Correa told reporters that he was unsatisfied with the U.S. House of Representatives approval of a six-month extension of the Andean Trade Promotion and Drug Eradication Act, a package of trade benefits in exchange for counter-drug activities.

These benefits should "last as long as the anti-drug fight lasts," Correa said upon arriving in Ecuador, adding that his Andean country will negotiate a long-term extension of the package with the next U.S. Congress.

Before leaving Lima, where he met with his Peruvian counterpart, Alan Garcia, following the second South American Community of Nations summit in Bolivia, Correa told Peru’s Radioprogramas radio that the bilateral U.S. free trade pact would be "tremendously harmful" to Ecuador.

The Andean country adopted the dollar as its currency in 2000 to halt hyperinflation. But Correa says that a trade agreement with the U.S. — like the ones Colombia and Peru already have signed — could create "incalculable" damage for Ecuador since the country cannot control its currency’s value.

"We don’t have a national currency, we have the dollar," he told Radioprogramas. "If as a result of the agreement, Peru and Colombia have a problem in the external sector, they reduce the currency’s value and correct the imbalance. Ecuador can’t do that and the consequences could be incalculable."

While critical of the decision to adopt the dollar, Correa, who takes office has reassured Ecuadoreans that he intends to maintain the dollar as Ecuador’s official currency for the next four years.

Associated Press Writer Gabriela Molina contributed to this report from Quito, Ecuador.

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source: IHT