F.T.A.A. MEETING ENDS EARLY WITH LIMITED AGREEMENT.
At the Free Trade Area of the Americas (FTAA) Eighth Ministerial Meeting, held Nov. 20-21 in Miami, the 34 trade ministers from across the Americas were unable to agree on issues that included agricultural subsidies. Under pressure to avoid a repeat of the failure of World Trade Organization (WTO) talks in Cancun in September (see NotiSur, 2003-10-10), trade ministers in Miami approved a watered-down framework for the FTAA that was considered a setback for the US.
Ten years after all countries in the hemisphere except Cuba made the commitment to work toward implementation of the FTAA by 2005, free trade has lost much of its appeal, both in the US and in Latin America. Labor unions blame it for job losses in the US, and Latin American and Caribbean countries say it destroys rural farmers and leaves them vulnerable to domination by US multinational companies.
In the period leading up to the Miami meeting, it was clear that the marked differences between the US and Brazil, the co-chairs of the Miami meeting, would not be easy to reconcile.
Brazil's Ambassador to the US Rubens Barbosa said before the meeting that Brazil had made a significant concession by agreeing to US demands, backed by Canada, that reductions in domestic farm subsidies and changes to anti-dumping rules would be negotiated only in the WTO, not in the FTAA. He said Brazil, along with other MERCOSUR countries, wanted a similar right not to include services, intellectual property, and government procurement in regional negotiations.
MERCOSUR includes Argentina, Brazil, Paraguay, and Uruguay, with Chile and Bolivia as associate members. In the past, sectoral disputes and conflicts between Brazil and Argentina often marred MERCOSUR unity. Now, however, the governments of Presidents Luiz Inacio Lula da Silva in Brazil and Nestor Kirchner in Argentina are leading a united stance to defend the world's third-largest trade bloc and its decision-making autonomy, said Cristina Pecequilo of the Centro Universitario Ibero-Americano in Sao Paulo. Brazil seemed prepared to walk away from the talks rather than cave in to US pressure.
Brazil-US proposal
Faced with the prospect of another Cancun, the US and Brazil came up with a draft calling for a "flexible" FTAA, which would permit countries "to assume diverse levels of commitment" in the agreement. The draft pushed all the difficult decisions back to the Trade Negotiating Committee (TNC), where they have been stuck for a year.
"There is an agreement between MERCOSUR and the US on this vision of the FTAA that will allow flexibility in certain areas and that will allow countries to be engaged in 'plurilateral' agreements, so that an FTAA will not impose on the 34 countries the same obligations," said Brazilian FTAA negotiator Luiz Filipe de Macedo Soares. "So, they will be able to choose."
The proposal was seen as a diplomatic way out of the deadlock over the scope of the agreement. The clearest sign of the draft's avoidance strategy was its treatment of the deadline for completion of a pact. It repeated the January 2005 goal, yet provided no interim deadlines or instructions about how to meet it. The one firm deadline--Sept. 30, 2004, for market-access talks--makes it clear that the January 2005 deadline will not be met.
"By doing this, they are acknowledging there is no way to get the rest of it done by the end of next year," said David Waskow, trade-policy coordinator for Friends of the Earth. "It's a hollow shell of an agreement. For the US, this is a clear rebuff."
But US Trade Representative Robert Zoellick defended the proposal, saying one of its achievements was simply to keep the FTAA process alive. "I've never been in a negotiation where you move it forward by stopping," he said. "We will be judged by the final results."
Given the extent of the disagreements, the draft was probably the best that could be expected, said Pedro de Camargo Neto, a former Brazilian trade negotiator. "Both sides are going to call it a success," he said. But the conflicts haven't been resolved, just papered over and it merely postponed the confrontation.
A group of 13 countries led by Canada and Chile initially rejected the proposal, but gave in when the US and Brazil made it clear they were not prepared to change their positions. The rigidity led some negotiators to question whether the main purpose of the proposal was an attempt to avoid an embarrassing outcome in Miami, a city vying to be selected as the FTAA permanent secretariat site.
"This is nothing but a...
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