- The Washington Times - Sunday, February 1, 2004

The United States and 33 other nations this week pick up talks to create a free-trade zone from Alaska to Argentina, but officials are uncertain they will be able to bridge wide differences before an end-of-year deadline to complete the pact.

The Western Hemisphere’s democracies in November agreed to an outline for the Free Trade Area of the Americas, an agreement that would cover 34 nations with 800 million people and $13 trillion in economic output.

But the outline, while allowing leaders to declare success at the Miami summit, purposely left vague “a common and balanced set of rights and obligations applicable to all countries.”

This week deputy trade ministers will try to fill in the blanks and determine minimum commitments and benefits when they meet in Puebla, Mexico, a colonial city southeast of Mexico City.

“The prospects for success in Puebla are, quite frankly, uncertain,” Christopher Padilla, assistant U.S. trade representative for intergovernmental affairs, said last month at a Brazil-U.S. Business Council forum in Washington.

“It is going to be the first time since Miami that we are going to discuss what should be contained in the common set of rights and obligations. We don’t have a lot of time left if we are going to stay on schedule,” Mr. Padilla said.

U.S. trade officials have since withheld any comment on the FTAA process, but other nations acknowledge they have a lot of work to do.

“I think it will be a difficult negotiation,” Rubens Barbosa, Brazil’s ambassador to the United States, said Friday.

Adding to the uncertainty, political leaders in Venezuela last week said the end-of-year deadline would be impossible for the FTAA.

Inter-American relations at times have been testy. Going into the Miami meeting, the United States and Brazil had been at odds since the collapse of World Trade Organization talks in Cancun, Mexico, in September.

The United States blamed Brazil for causing the breakdown.

In Miami, the two sides patched up their differences rather than face another stalemate, but left difficult details for three meetings through the course of the year, starting with Puebla.

“I think this [meeting in Mexico] is going to be somewhat easier than you would expect. I expect that people will want to use this to get agreements rather than do battle,” said Peter Hakim, president of the Inter-American Dialogue, a Washington-based policy center.

Most countries want to reach an agreement on schedule. Unless U.S.-Brazil differences are intractable, some compromise should be possible, Mr. Hakim said.

The United States wants as much as possible included in the common set of rights and obligations, while Brazil and some other nations want clear limits in areas like trade in services, intellectual property protection and government procurement policies.

The United States also wants, and the Miami compromise calls for, benefits commensurate with obligations.

Brazil had resisted the language and the two camps are certain to debate how much benefits vary.

“We wouldn’t like to see this applied as a penalty to those countries that are not prepared at this moment to go ahead in a more deep way,” Mr. Barbosa said.

Brazil and its partners in the Mercosur trade bloc will offer a “practical” proposal with the goal of finishing negotiations by the end of the year, Mr. Barbosa said.

Negotiations are likely to focus on lowering barriers to trade in industrial goods — a relatively easy step — while countries would be allowed to choose levels of commitment and deadlines in other sensitive areas.

Independently, the United States has or is negotiating bilateral free-trade agreements with countries that, excluding the United States, represent two-thirds of the hemisphere’s population and economy.

Canada, Mexico and Chile have pacts; five Central American nations have completed negotiations; the Dominican Republic started negotiations; and Colombia, Peru, Bolivia and Ecuador have announced they plan to start negotiations.

The FTAA process began in 1994.

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