April 2, 2008 / 12:38 AM / 12 years ago

U.S. Commerce chief optimistic on Colombia deal

WASHINGTON (Reuters) - The Bush administration believes congressional Democrats will agree to vote on a free trade pact with Colombia, despite an unfriendly U.S. political climate for trade, a top U.S. official said on Tuesday.

Colombia's President Alvaro Uribe (R) and U.S. Commerce Secretary Carlos Gutierrez greet supporters during a meeting in the suburb sector of Comuna 13 in Medellin March 1, 2008. REUTERS/Albeiro Lopera

“Yes, I believe we can work together to give an ally the benefit of a vote,” U.S. Commerce Secretary Carlos Gutierrez told the Reuters Latin American Investment Summit. “We hope that very soon we will have a bipartisan consensus that now is the time to take it up.”

The Bush administration signed the free trade agreement with Colombia in November 2006, shortly after the Democrats won elections giving them control of Congress.

Since then, the White House has struggled to persuade House Speaker Nancy Pelosi to schedule a vote on pact, which U.S. labor groups strongly oppose on the grounds that Colombia has not done enough to stop murders of trade unionists.

With only about 10 months left in office, President George W. Bush has signaled his intention to submit the agreement to Congress soon for a vote sometime this year. Bush argues the agreement warrants approval on trade as well as national security grounds since Colombia is a strong ally in an otherwise volatile region of Latin America.

The Bush administration believes it can round up enough Democratic votes to approve the agreement, even though Democratic presidential hopefuls Hillary Clinton and Barack Obama both say they can not support it at this time.

Pelosi has said she saw no hope for the Colombia deal until the White House and Congress agree on an expanded program to help U.S. workers who have lost their jobs because of import competition or factories moving overseas.

“We recognize that there is room for strengthening (trade adjustment assistance). We hope to work together with leadership to do that ... We believe the environment is conducive” to reach a bipartisan deal, Gutierrez said.

NAFTA UNDER FIRE

White House efforts to win approval of the Colombia deal come as both Clinton and Obama are threatening to withdraw the United States from the 14-year-old North American Free Trade Agreement unless Canada and Mexico agree to add stronger labor and environmental provisions to the pact.

Gutierrez called NAFTA “an overwhelming success” that has helped boost economic growth as U.S. trade with both countries has grown to more than $900 billion annually.

Bush will meet with Canadian Prime Minister Stephen Harper and Mexican President Felipe Calderon later this month in New Orleans. Gutierrez said he did not know if the leaders would issue a joint statement in defense of NAFTA, but said there were no plans for them to discuss reopening it.

Bush took office in January 2001 with hopes of expanding NAFTA into the Free Trade Area of the Americas, which would cover every country in the Western Hemisphere except Cuba.

Although that effort failed, “I believe it’s a matter of time before everyone in the hemisphere realizes this is a competitive necessity,” Gutierrez said. “It is a good idea today ... and it will be a good idea in five years.”

DIFFICULT DECISIONS NEEDED FOR DOHA

In the shorter term, the Bush administration still believes it is possible to reach a new world trade agreement this year and is prepared to make significant farm subsidy cuts if other countries open their market to more U.S. goods, he said.

Latin American producers also want more access to the U.S. market for sugar, orange juice, beef and other farm goods.

“I think it’s fair to say that in order to have a successful round that everyone is going to have to make potentially difficult decisions,” Gutierrez said, without saying what concessions the United States could make.

Countries in South and Central America exported about $134.7 billion worth of goods to the United States in 2007, up only about $1 billion from the previous year, while China’s exports to the United States showed much stronger growth.

The current U.S. economic slowdown “could have an impact on some imports” from Latin America and other suppliers if U.S. consumers cut down on purchases, Gutierrez said.

But so far, “Latin America has continued to grow in spite of the fact that we are going through a period of correction,” Gutierrez said. That partly reflects stronger import demand from other parts of the globe, he said.

(For summit blog: summitnotebook.reuters.com/)

Editing by Jeffrey Benkoe

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