- The Washington Times - Friday, September 16, 2005

Peru hopes to conclude free-trade-agreement negotiations with the U.S. next month and win swift approval by Congress, the country’s president said yesterday.

But U.S. officials say talks are lagging and the House, which in July narrowly approved the Central American Free Trade Agreement, may not be ready to vote on the Andean Free Trade Agreement with Peru, Colombia and Ecuador even next year.

“We don’t want this free-trade agreement to be prisoner of a fight between Republicans and Democrats, and therefore we have decided to talk to both [sides],” President Alejandro Toledo told editors and reporters at The Washington Times. “The Democrats very much have a good predisposition.”

Some Democrats disputed the assertion, and instead said that opposition to Bush administration trade policy coalesced after CAFTA, which passed by two votes, rather than weakened.

“There’s no difference in the Andean Free Trade Agreement compared with the Central American Free Trade Agreement. Look at the region,” said a Democratic aide who helped organize opposition to CAFTA.

CAFTA won support of only 15 Democrats after party leaders faulted the pact’s labor provisions. U.S. sugar producers and some apparel manufacturers, both worried about imports, also opposed the pact.

The same labor, farm and manufacturing issues are likely to crop up with the Andean countries.

Still, Mr. Toledo said he would like the agreement in place before unilateral U.S. trade preferences for the region expire at the end of 2006. Though Peru is considered well along in negotiations, the other countries are not.

“While the Andean countries hope that the negotiations will conclude in October, the [U.S.] delegation is somewhat pessimistic that the negotiations will finish and be implemented before the preferences expire, given that negotiators have held 11 rounds without resolution of critical agriculture issues,” said a House Ways and Means Committee report made public yesterday.

Mr. Toledo was elected to office in the constitutional republic in 2001 after leading opposition to former President Alberto Fujimori. He promised an end to corruption and patronage, and to spur economic growth. Since then, the economy has improved and exports have doubled; but poverty remains widespread and his term has been marked by civil unrest, scandal and approval ratings as low as 8 percent.

“I am not governing for the next election. I am governing for the next generation,” the Stanford-educated economist said in fluent English.

The president is elected by popular vote for a five-year term, with the opportunity for one consecutive re-election.

Mr. Toledo is hoping foreign investment will boost his country’s economy. But last month, a judge in Lima sent shivers through the international investing community when he ordered the arrest of the current and former General Electric chief executives, Jeffrey Immelt and Jack Welch, and of 24 other GE employees.

They are accused of breaching a contract with a local businessman who says he invested $10 million in offices and an assembly plant in the 1990s, based on an agreement with GE. When the agreement was canceled, he charged fraud.

Mr. Toledo said that while the indictment wasn’t necessarily “helpful” in his efforts to attract U.S. business investment to Peru, he had no intention of doing anything to influence Peru’s independent judiciary. The United States has more than 500 companies and $10 billion invested in Peru.

“I hope [the GE situation] will be resolved properly … respecting the clear rules of law,” he said. “I cannot get into it more because I cannot interfere with the judicial system.”

He said the issue of Lori Berenson, an American who is halfway through a 20-year sentence in a Peruvian jail for aiding Tupac Amaru terrorists in the 1990s, is concluded.

“Lori Berenson has had three fair trials and even Inter-American Court of Human Rights has upheld her conviction,” he said.

Regarding Mr. Fujimori, who is living in exile in Japan, Mr. Toledo said that he hoped the former president would return to Peru, where he faces charges stemming from his time in office. Japan has been unwilling to extradite him, saying he is a Japanese citizen.

“If Fujimori wants to return to Peru from Japan, that would be fine and good for democracy, because he has to answer some questions,” Mr. Toledo said. “He just renewed his Peruvian passport, so he is Peruvian. I don’t know why he is hiding behind Japanese nationality.”

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