White House Warns
Costa Rica Ahead of
Vote
By Doug Palmer
WASHINGTON (Reuters) -
The United States will
not renegotiate a free
trade agreement with
Costa Rica if voters in
that country turn down
the pact in a referendum
on Sunday, the White
House said.
"If the free trade
agreement is rejected,
the United States will
not renegotiate the
agreement," White House
spokeswoman Dana Perino
said in a statement on
Saturday that was the
latest in a series of
conflicting messages
from Washington ahead of
Costa Rica's vote.
"The United States has
never renegotiated a
free trade agreement
that has been approved
by the Congress," she
said.
Perino also warned that
some trade benefits that
Costa Rica now enjoys
under the separate
Caribbean Basin
Initiative could be at
risk if voters decide
not to join the
U.S.-Central America
Free Trade Agreement (CAFTA)
along with four of its
neighbors, the United
States and the Dominican
Republic.
"With respect to trade
preferences provided
under the Caribbean
Basin Initiative which
will expire in September
2008, the United States
has never before
confronted the question
of extending unilateral
trade preferences to a
country that has
rejected a reciprocal
trade agreement," Perino
said.
The referendum has split
Costa Rica, with
President Oscar Arias
and some businesses
saying CAFTA will bring
investment and jobs.
Opponents says it will
mean a flood of cheap
farm imports and limit
the country's
sovereignty by taking
investment disputes to
international
arbitration.
The U.S. House of
Representatives narrowly
approved the agreement
in 2005, with most
Democrats voting no.
Many Senate Democrats
were also opposed.
DEMOCRATS REASSURE
VOTERS
The free trade deal
locks in Costa Rica's
duty-free access to the
U.S. market under the
Caribbean Basin
Initiative and phases
out many trade barriers
facing U.S.
manufacturers, farmers
and service industry
companies in Costa Rica.
Although many of the
trade benefits Costa
Rica currently receives
are permanent, others
benefiting Costa Rica's
textile and tuna
industries expire next
year.
Democrats in Congress --
including House Speaker
Nancy Pelosi and Senate
Majority Leader Harry
Reid -- have sought to
reassure Costa Rican
voters that their
country would not lose
trade benefits if the
pact is defeated.
"Congress is
constitutionally
responsible for
regulating international
commerce. As such, we
reiterate our
long-standing position
that preference programs
should not be
conditioned on a country
entering into a free
trade agreement (FTA)
with the United States,"
House Ways and Means
Committee Chairman
Charles Rangel said in a
statement on Friday with
Rep. Sander Levin, who
chairs a House trade
subcommittee.
Meanwhile, the Bush
administration and
congressional
Republicans have warned
there is no guarantee
the Democratic-led
Congress will renew the
benefits that expire
next year if the
agreement goes down.
"Having worked to pass
this deal two years ago,
I know that any
so-called guarantee that
suggests the House will
continue granting
special trade status to
Costa Rica indefinitely
and without limits does
not exist," House
Republican Whip Roy
Blunt said in a
statement on Tuesday.
President George W.
Bush's chief trade
negotiator, U.S. Trade
Representative Susan
Schwab, also warned
Costa Rican voters this
week to think twice
about rejecting the
pact, and the White
House continued that
line.
"Voters in Costa Rica
should be aware that
many of those assuring
Costa Rica of continued
access to the U.S.
market have consistently
opposed measures that
would open the U.S.
market to goods from
Costa Rica and other
countries," Perino said.
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