- The Washington Times - Thursday, November 20, 2003

MIAMI — Trade ministers working to create the world’s biggest free-trade zone hashed out a compromise agreement one day early, successfully wrapping up a meeting that just weeks ago appeared to be headed toward failure.

The Free Trade Area of the Americas (FTAA), a key component of Bush administration policy in the Western Hemisphere, would cover 34 nations with 800 million people and $13 trillion in economic output.

The delegations adopted a proposal mostly hammered out on Wednesday that would allow the nations to pick and choose among parts of the agreement.

Heads of 34 delegations met around the same table for the first time yesterday to discuss the compromise agreement worked out between the United States and Brazil. The document is meant to propel talks toward a conclusion before Jan. 1, 2005.

“There remains a tremendous challenge to try and create free trade throughout the hemisphere,” U.S .Trade Representative Robert B. Zoellick said last night.

The United States and Brazil had been at odds since the collapse of the September World Trade Organization talks in Cancun, Mexico. The United States blamed Brazil for causing the breakdown.

This week, the two sides patched up their differences rather than face another stalemate.

“The Cancun WTO meeting ended a little early too, but not under as happy circumstances,” Mr. Zoellick said, saying all parties had learned lessons from the collapse.

U.S. and Brazilian officials indicated that future negotiations would focus on lowering barriers to trade in industrial goods — a relatively easy and non-controversial step — while countries would be allowed to pick and choose levels of commitment and deadlines in other sensitive areas.

The still vague, multitrack approach embraces “a common and balanced set of rights and obligations applicable to all countries” but does not specify them, according to a declaration issued by 34 ministers yesterday.

The hemisphere’s democracies probably would build the free-trade zone in stages while sensitive issues, such as agricultural subsidies or new rules to protect foreign investors and prevent piracy of music and film, would apparently be delayed or moved to a global forum.

“This is more than just a treaty. It will involve huge internal reforms in economies,” Enrique Iglesias, president of the pro-FTAA Inter-American Development Bank, told trade ministers to start the day.

Under the compromise, the U.S. trade team allowed some concessions on timing and depth of commitments, and Brazil agreed to leave sensitive topics on the table for future talks.

“We are just being realistic and seeing what can be put forward now,” Celso Amorim, Brazil’s foreign minister, told his counterparts in the morning.

Mr. Amorim and Mr. Zoellick said their proposal is for an ambitious, comprehensive and flexible agreement, though critics in the business sector and some other governments said it was a watered-down deal.

“While I’m disappointed that the degree of ambition reflected in the FTAA ministerial declaration isn’t more clearly defined, it still represents progress,” said Sen. Charles E. Grassley, Iowa Republican and a party leader on trade issues.

Trade ministers said they are taking a necessary step.

Mr. Zoellick emphasized that negotiations are just beginning. The FTAA process began in 1994 and trade ministers are meeting for the eighth time since then but have only recently tackled specific issues.

The Miami meeting is meant to give the negotiations a final push and provide direction for deputies who have to work out the final details of an agreement that would cover market access for industrial goods, opening of agriculture markets, government contracts, investment rules, anti-monopoly and competition rules, intellectual-property rights, services such as banking, subsidies, trade retaliation, and how to settle disputes.

The FTAA would open markets to new or cheaper goods and services and to more investment. Opponents worry it would force people to change jobs as competition in some sectors becomes more fierce, hurt the environment and exacerbate poverty.

“The vision for the FTAA is blind to the needs of poor people and is not going to contribute to development,” said Phil Bloomer, trade campaign head for Oxfam, an antipoverty group.

The text discussed yesterday has a “strategic ambiguity” that allows countries with different goals to interpret it and explain it in different ways, and ultimately will allow larger countries to demand greater concessions from smaller nations, he said.

Police and anti-free trade protesters clashed on the streets as the trade ministers cloistered to work out the step-by-step approach for the trade zone.


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