U.S. Eyes Next Step
After Costa Rica
Approves TLC Trade
Pact
By Doug Palmer
WASHINGTON (Reuters) -
The Bush administration
on Monday welcomed Costa
Rica's narrow approval
of a free trade
agreement with the
United States, after a
national debate that
split the tiny Central
American democracy.
Costa Rican voters
backed the U.S.-Central
American Free Trade
Agreement, or CAFTA, by
the slim margin of 51.58
percent in favor to
48.42 percent against --
in an echo of the bitter
debate in the U.S.
Congress over the
agreement two years ago.
"We are pleased that
Costa Rica will be
joining the other CAFTA-DR
countries in reaping the
benefits of greater
regional economic
integration and market
opportunities," U.S.
Trade Representative
Susan Schwab said in a
statement.
Costa Rica was the only
country to hold a
referendum on the pact,
which also includes El
Salvador, Guatemala,
Honduras, Nicaragua, the
Dominican Republic and
the United States.
The U.S. Congress
narrowly approved the
agreement in 2005 after
a fierce battle that
severely damaged
relations between
Republicans and
Democrats on trade.
Schwab said the Bush
administration would
work with the Costa
Rican government on
additional steps it
needs to take so the
pact can go into force
"as soon as possible."
"We believe, and history
confirms, that countries
that open their markets
have greater success in
generating economic
growth and development,"
she said.
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.
Critics fear it will
mean a flood of cheap
U.S. farm imports and
damage state-run
companies, endangering
funding for Costa Rica's
welfare state.
The pact exposes
state-run sectors like
telecommunications and
insurance to competition
from foreign firms.
The White House warned
one day before Sunday's
vote in Costa Rica that
it would not renegotiate
the pact if it was
rejected.
"That nearly half the
public in Latin
America's richest
free-market democracy
opposed CAFTA despite
the intensive campaign
in favor of it should
end the repeated claims
that pushing more
NAFTA-style free trade
deals is critical to
U.S. foreign policy
interests in the region
or helps the U.S.
image," said Lori
Wallach, director of
Public Citizen's Global
Trade Watch division and
a longtime foe of the
Bush administration's
trade policies.
Congress appears set to
approve a free trade
agreement with Peru in
coming weeks, after the
Bush administration
agreed to strengthen
labor and environmental
provisions of the pact
to pick up support from
Democrats.
But the outlook for an
agreement with Panama is
in doubt after that
country's legislature
chose as its leader a
man wanted in the 1992
killing of a U.S.
soldier.
Democrats also want
Colombia to show much
more progress in
reducing violence
against union leaders
before Congress votes on
a trade pact with that
country. |
|
