TOPICS > Economy

U.S. Push for Latin American Free Trade Agreement Falls Short

BY Admin  November 7, 2005 at 4:00 PM EDT

The U.S. and 28 other countries, including Panama and Mexico, wanted to set an April deadline for talks to hammer out a new “Free Trade Area of the Americas,” that would stretch from Canada to Cape Horn.

But a movement led by Venezuelan President Hugo Chavez foiled attempts to come to a formal agreement.

“Argentina, Uruguay, Brazil, Paraguay and Venezuela find that conditions do not exist to negotiate the FTAA as proposed,” explained Argentine Foreign Minister Rafael Bielsa at the end of the talks.

Representatives of the five nations that opposed the deadline said they preferred instead to wait until the outcome of an upcoming World Trade Organization meeting, aimed at reducing tariffs and boosting the global economy, before moving forward on a regional trade initiative. Except for Venezuela, the opposition nations are all a part of a current regional trade pact known as Mercosur.

“Anything we do now, before the WTO meeting, could confuse the facts and we’d be creating an impediment to the WTO,” Brazilian President Luiz Inacio Lula da Silva said.

For Lula, one of the obstacles to the FTAA agreement is government farm subsidies that the United States pays to domestic crop producers. He said Latin American farmers could not compete with farms propped up by the U.S. government.

In a meeting with Lula in Brazil on Saturday, President Bush hinted that he would be willing to drop U.S. farm subsidies, but only if European countries did the same.

”Only an ambitious reform agenda in agriculture and manufactured goods, and services can ensure that the benefits of free and fair trade are enjoyed by all people in all countries,” Mr. Bush said.

In spite of the inability to set a deadline for the agreement, President Bush offered a positive overall view of the trade summit during a Monday meeting in Panama with President Martin Torrijos, a free trade ally.

“At the summit on the FTAA, 29 countries said, let’s make sure in 2006 we continue discussing a way forward for the FTAA — 29 of the 34 countries,” President Bush said. “There was a strong approval for the concept of working together to put agreements in place that will enable us to compete with China in the long run, for example. And so I found the spirit for free trade to be strong. There was five nations that said, well, we don’t want to do it as soon as 2006.”

Venezuelan President Chavez hurled accusations at the United States and Mr. Bush throughout the conference, seeking to dissuade representatives of the 34 attendee nations from supporting the FTAA.

“We will never be North American colonies,” Chavez reportedly said, adding that Latin American countries will “bury capitalism in order to give birth to 21st century socialism, a new historic socialist project that the people of the Americas are demanding.”

Chavez spoke to a group of 25,000 protesters demonstrating against the globalization and free trade, accusing the United States of imperialist intentions abuses of power in Latin America and around the world. Some of the protestors agreed, lashing out at Mr. Bush.

“He’s responsible for attacking other countries and the human rights violations in Iraq, Afghanistan and the jails of Guantanomo,” said Adolfo Perez Esquivel, an Argentine Nobel peace laureate who helped organize protests, according to the Washington Post. “Now the U.S. is putting military troops all over South America. We must be very attentive to these things, because they have to do with the sovereignty of our people.”

Some protesters clashed with police after breaking windows and attempting to set fire to businesses.

In the end, conference attendees were reluctant to fully embrace the view of the United States but distanced themselves from Chavez’s fiery rhetoric.

“This is not the end of the FTAA. The FTAA is a side note to a summit that was dealt with something else. It dealt with [creating] decent jobs, reducing poverty and democratic governance,” said Argentine Foreign Minister Bielsa.

Argentine President Nestor Kirchner said “We must create a kind of globalization that works for everyone, and not just for a few.”

President Vicente Fox responded to Chavez’s claim that the meeting was the FTAA’s “tomb” by asserting that the Venezuelan leader’s comments represented, “one person’s opinion.”

President Bush responded to Chavez’s and other opposition leaders’ comments indirectly in a Sunday speech in the Brazilian capital. Mr. Bush said that Latin Americans must choose between two “competing visions.”

“One offers a vision of hope — it is founded on representative government, integration into the world community, and a faith in the transformative power of freedom in individual lives,” the president said. “The other seeks to roll back the democratic progress of the past two decades by playing to fear, pitting neighbor against neighbor — and blaming others for their own failures to provide for their people.”