Thursday, June 5, 2003

The United States will sign a trade agreement with Chile today, setting the stage for Congress to vote on the first two free-trade pacts negotiated by the Bush administration.

Today’s ceremony in Miami follows by one month Mr. Bush’s signature on a pact with Singapore.

Both are firsts — the United States’ first free-trade agreement with a South American nation, and the first one with an Asian nation.

They also will be the first such bills considered by Congress since it granted the president trade-promotion authority last August. The bill allows the White House to negotiate trade deals and submit them to Congress for an up-or-down vote without amendments.

Chile and Singapore also must approve the agreements.

U.S. Trade Representative Robert B. Zoellick, scheduled to be in Miami today to sign the Chile accord, has described both agreements in glowing terms, saying they “offer increased opportunities for U.S. businesses, farmers and workers, and send a message to the world that the United States will embrace closer ties with nations that are committed to open markets.”

The final political test for the deals will come when Congress reviews and votes on them.

Trade has been a divisive partisan issue. The House narrowly approved the trade-promotion authority measure, 215-212, with only 21 Democratic votes. The Senate margin was wider, 64-34.

The House Ways and Means trade subcommittee has scheduled a hearing on the two pacts for Tuesday, and the Senate Finance Committee, which has jurisdiction over trade, is tentatively set to look at the agreements June 17. A final vote is expected this year.

“My impression is that they will not have too much trouble” winning approval, said Sidney Weintraub, a scholar at the Center for Strategic and International Studies, a Washington think tank that has favored lower trade barriers.

Both countries have open economies, and both have relatively strong labor and environmental laws, which are key issues for legislators, Mr. Weintraub said.

Environment and labor issues have been especially troubling for free-trade advocates in Congress, with opponents arguing that deals can weaken environmental protection and harm workers in the United States and abroad.

Rep. Richard A. Gephardt, Missouri Democrat and a declared candidate for the 2004 presidential race, said in a letter last month to Mr. Zoellick that the Singapore agreement would “continue to corrode our economy and undermine our nation’s standard of living.”

Organized labor plans to oppose both agreements, but union officials concede their opposition probably will not derail the agreements.

“I don’t think it’s likely were going to defeat the agreements. But it is important to be on record against them,” said Thea Lee, chief international economist at the AFL-CIO, a labor federation.

“It’s important because it’s the first of these agreements [for the Bush administration], and the administration has made clear that they will serve as templates,” she said.

The Chile and Singapore deals would be the fifth and sixth bilateral free-trade agreements for the United States.

In addition to Chile and Singapore, the Bush administration is formally working on bilateral trade agreements with 12 other countries in Africa, Central America and Australia, and has announced several other candidates for trade pacts.

The first round of formal talks between the United States and the five countries of the Southern African Customs Union — which includes South Africa, Lesotho, Botswana, Namibia and Swaziland — ended this week.

The Bush administration also is working on a hemisphere-wide Free Trade Area of the Americas with 34 countries in the Western Hemisphere and an international accord at the World Trade Organization.

Informal talks on the Free Trade Area of the Americas are scheduled to take place in Maryland next week among officials from a small number of negotiating nations.

Finalizing the Chile pact is expected to lend some momentum to the FTAA process, Mr. Weintraub said.

“Without Chile, it would have made the FTAA much harder,” he said.

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