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US House OKs 8-month Andean trade benefit extension

US House OKs 8-month Andean trade benefit extension

28 Jun 2007

Source: Reuters

By Doug Palmer

WASHINGTON, June 27 (Reuters) — The U.S. House of Representatives on Wednesday approved an eight-month extension of long-standing trade benefits for Andean countries, potentially setting the stage for approval of a free trade pact with Peru and a contentious debate on a deal with Colombia.

The House voted 365-59 to extend the preferences, just days before the nearly 16-year-old Andean trade preferences program is set to expire at midnight on Saturday.

The Senate is expected to approve the extension before lawmakers leave on Friday or Saturday for their Fourth of July holiday recess.

The fate of the Andean Trade Promotion and Drug Eradication Act has become entangled in a Bush administration battle with Congress to win approval of free trade agreements with Peru and Colombia, as well as U.S. concerns over a leftist turn in the governments of Bolivia and Ecuador.

The United States has allowed all four countries to ship most of their goods to the United States without paying duties since December 1991 in an effort to discourage illegal drug production in the Andean region.

But in May 2004, the Bush administration began negotiations with Colombia, Peru and Ecuador aimed at replacing the one-way trade preference program with free trade agreements that would open the Andean region to more U.S. exports while locking in and expanding their duty-free access to the United States.

U.S. negotiators concluded free trade deals with Peru and Colombia but talks with Ecuador collapsed and negotiations with Bolivia never got off the ground.

Republican lawmakers have since used the periodic expiration of the trade preference program to try to force votes on the trade deals with Colombia and Peru.

Last December, when Republicans still ran Congress, they pushed through a six-month extension of the Andean program in the hope of putting pressure on Democrats to vote on the Peru and Colombian agreements after they took charge in January.

Instead, Democrats sought changes to the Peru and Colombia agreements and proposed to extend the Andean Trade Promotion and Drug Eradication Act until September 2009.

They agreed this week to just an eight-month extension after Sen. Charles Grassley, an Iowa Republican, took a hard line against renewing the program at all.


The Bush administration and U.S. lawmakers agreed on a blueprint to strengthen labor and environmental protections in the free trade deals with Peru, Colombia and Panama, as well as one that Washington hopes to sign with South Korea by the end of the week.

Lawmakers in Peru took their country’s trade deal a step closer to a vote in the U.S. Congress by approving a series of amendments on Wednesday to tighten labor laws and introduce measures to combat slavery and illegal logging.

"Peru is largely in favor of this agreement, which will bring nothing but benefit to the country," Prime Minister Jorge del Castillo told lawmakers shortly after the vote.

The United States is Peru’s main trading partner, accounting for nearly 20 percent of its exports.

U.S. Trade Representative Susan Schwab told reporters on Wednesday the Bush administration hoped for a vote on the Peru agreement by the end of July.

Democratic leaders have not committed to that, but the pact with Peru is far more popular than the one with Colombia.

Pressured by U.S. labor groups, Democrats want Colombia to show concrete progress in reducing violence against union leaders and bringing killers to justice.

(Additional reporting by Adriana Garcia in Washington and Teresa Cespedes in Lima)

 source: Reuters