- The Washington Times - Wednesday, June 2, 2004

The trade agreement that the United States and Central American countries signed Friday could become a casualty of election-year posturing, with Sen. John Kerry leading the deal’s push over the political precipice. This is a shame, because the Central American Free Trade Agreement (CAFTA) bolsters prospects for the region’s development while expanding markets mainly for U.S. agricultural producers and fabric-makers.

In Mr. Kerry’s latest incarnation, he has criticized America’s trade deals in general and CAFTA in particular. This positioning is surprising, since Mr. Kerry had consistently supported major trade initiatives. Mr. Kerry said Friday that CAFTA “would actually make the current situation worse because it would take away a strong tool to help address violations of core labor standards that is now included in our current system of trade preferences for Central America.” Clearly, Central American governments themselves believe otherwise. Also, the trade preferences Mr. Kerry refers to grant Central American countries trade benefits, but do not open markets for U.S. exporters, as CAFTA would.

Mr. Kerry said he will vote against CAFTA. Interestingly, Mr. Kerry voted in favor of: NAFTA in 1993; the General Agreement on Tariffs and Trade (GATT), which established the World Trade Organization, in 1994; Permanent Normalized Trade Relations (PNTR) with China in 2000; and “fast track” trade negotiating authority in 1997 and 2002. Mr. Kerry missed votes on trade agreements with Singapore and Chile last year, just one week after Teamsters President James P. Hoffa Jr. threatened to withhold support from presidential candidates who voted for the measures. The White House has 60 days since signing CAFTA on Friday to send the trade bill to Congress. Lawmakers will have 90 days to consider the bill.

Trade with CAFTA countries (Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua) does not represent a large portion of total American exports, but it is larger than some might expect. When the Dominican Republic, which will sign the deal later this month, is included, U.S. producers exported about $15 billion to these countries, making it the second-largest export market in Latin America, behind Mexico.

Approving CAFTA would allow U.S. apparel suppliers to position themselves in Central America before global textile quotas expire at the end of the year and China seeks markets more aggressively. The American Apparel & Footwear Association has backed the deal, as has the American Farm Bureau Federation.

The agreement would improve the economic prospects of countries in America’s backyard and open export markets for U.S. producers. It will be interesting to see how many legislating lemmings follow Mr. Kerry’s CAFTA punt when Congress votes on the bill.

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