January 29, 2007 / 6:33 PM / 12 years ago

White House urges renewal of Bush trade authority

WASHINGTON (Reuters) - The White House urged Congress on Monday to renew President George W. Bush’s fast-track authority to negotiate a new world trade deal, but winning over the Democratic-controlled Congress is expected to test Bush’s skills in working with his opponents.

White House spokesman Tony Snow speaks during his daily media briefing in the temporary White House media room in Washington September 12, 2006. The White House urged Congress on Monday to renew key trade negotiating authority that expires in just a few months and said time was running short for countries to reach a new world trade deal. REUTERS/Larry Downing

The White House comments followed a weekend meeting of top trade officials from about 30 countries in Davos, Switzerland, which appears to have re-energized the five-year-old Doha round of world trade talks, even though no breakthroughs have been announced.

The White House needs the Congress to approve at least a short extension of fast-track trade promotion authority, which expires July 1, to finish the Doha talks and most likely other trade deals with South Korea and Malaysia which have fallen behind schedule.

The fast-track law allows the White House to negotiate trade pacts Congress must accept or reject without making any changes.

“We certainly think it is important that Congress renew it,” White House spokesman Tony Snow said. “We are in a very important part of (the Doha) negotiations. We have a small window to get a lot of things done.”

But in an indication of the challenges still facing negotiators in the world trade talks, France and Austria criticized European Union Trade Commissioner Peter Mandelson on Monday for suggesting the EU could do more on agricultural reform than it has previously offered.

Although Germany quickly came to Mandelson’s defense, the split was a sign that the EU may not be able to lower farm tariffs as much as Washington wants.

Meanwhile, the U.S. Agriculture Department announced it will outline its proposals on Wednesday for revamping U.S. farm subsidy programs, which are up for renewal this year. Many countries could see the proposal as a barometer of how serious Washington is about reforming agriculture in the Doha round.

DIFFERENCES

Bush is expected to stress the importance of trade to the U.S. economy in speeches on Tuesday and Wednesday in Illinois and New York. He won fast track trade legislation in 2002 after a bitter fight with Democrats in the House of Representatives.

With Democrats now in control of the House and the Senate, many analysts believe Bush needs a breakthrough in world trade talks in the next few months to have any chance of persuading Congress to renew fast track.

“The more likelihood there is of a positive outcome to Doha, the more pressure there will be on both parties to come up with a deal” on fast track, said Sherman Katz, a senior associate at the Carnegie Endowment for International Peace. But “it will take tough bargaining,” Katz said.

One thing Bush could do to help his chances is to give into a Democratic party demand and negotiate tougher labor and environmental provisions in trade pacts with Peru, Colombia and Panama that he plans to send to Congress this year.

“If you don’t actually work through that, I think there will be a residue of distrust with the Democrats,” said Gary Hufbauer, a senior fellow at the Peterson Institute for International Economics.

Others believe differences between the Democrats and Bush are too great for them to reach a deal.

“Because the important role that both trade and economic fairness played in the November election, Democrats won’t settle for small reforms and I’m not sure that President Bush can accept deep reforms,” said Thea Lee, policy director for the AFL-CIO labor federation, which has fought Bush on trade.

Still, Bush’s desire for trade promotion authority gives Democrats a chance to craft a big trade package addressing concerns ranging from workers who lose their jobs because of trade to the U.S. trade deficit with China.

“I think we’re looking at omnibus trade legislation. The question is whether that can bring enough people along ... You’ve got a lot of new members who are pretty skeptical of the trade policy as it’s (been) played out,” said Edward Alden, a senior fellow at the Council on Foreign Relations.

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