A Glimpse at Obama's Trade Policy

March 2, 2009 06:00 PM
 

via a special arrangement with Informa Economics, Inc.

Highlights of USTR report on key trade policy topics

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.


The U.S. Trade Representative's office on Monday released a congressionally mandated report on trade policy. Importantly, the report said the Obama administration would consider changes to the North American Free Trade Agreement (NAFTA), set benchmarks for approval of pending trade deals with Colombia and South Korea, and seek to change the direction of the Doha trade talks.


-- Doha Round of multilateral trade negotiations: The report warned that no further progress is likely in the Doha Round negotiations until other countries agree to improve their market-opening offers to ensure new opportunities for U.S. workers, farmers, and businesses. “A strong, market-opening agreement for both goods and services … would be an important contribution to addressing the global economic crisis,” the report said. “The administration is committed to working with our trading partners for such an outcome. However, it will be necessary to correct the imbalance in the current negotiations in which the value of what the United States would be expected to give is well-known and easily calculable, whereas the broad flexibilities available to others leaves unclear the value of new opportunities for our workers, farmers, ranchers, and businesses.”


-- Panama FTA: The Obama administration hopes to submit to Congress “relatively quickly” the pending U.S. free trade agreement (FTA) with Panama. The agreement with Panama was sidelined after Pedro Miguel Gonzalez, wanted in the U.S. for the murder of a U.S. soldier in 1992, was elected in 2007 to Panama’s National Assembly. Gonzalez recently stepped down.


-- Colombia, South Korea FTAs: The administration will establish “benchmarks” for progress on the pending FTAs with Colombia and South Korea, but no timetable for sending the agreements to Congress is available. In the past, Obama has opposed submitting the Colombia and Korea FTAs to Congress at the present time, arguing Colombia needs to do more to curtail violence against union members and that the Korea agreement as negotiated by the Bush administration falls short in opening the Korean market to U.S. automobile and auto-parts producers.


-- NAFTA: The administration will work with Canada and Mexico to identify ways in which the North American Free Trade Agreement (NAFTA) could be improved without having an adverse effect on trade. “We will do this in a collaborative spirit and emphasize ways in which this process can benefit the citizens of all three countries,” the report said. Obama has promised to "fix" NAFTA by adding enforceable labor and environmental provisions into core text of the agreement. Currently, those areas are covered by side agreements to the core text.


-- Trade Promotion Authority (TPA): The Obama administration will only ask Congress to renew its TPA -- under which trade agreements negotiated by the executive branch cannot be amended — after engaging in extensive consultations with Congress “to establish the proper constraints on that authority and after we have assessed our priorities and made clear to this body and the American people what we intend to do with it.”


-- Trade Agreement Reviews: Reflecting an Obama campaign promise, the report said that the administration plans to review the implementation of all FTAs and bilateral investment treaties (BITs) to ensure that they advance the public interest. “We particularly recognize the need to pay special attention to how our policies influence the well-being of people struggling both at home and in the poorest regions of the world,” the report said. “Fundamentally, our trade policy needs a keen appreciation of its economic consequences for our workers, their families, and their communities.” It said, however, that eliminating barriers to trade in light of the current serious turmoil in the U.S. economy and financial markets “will be a challenge.”


NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.


 

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