TRADE MARCHES ON

Latin declension (Financial Times, 11/08/05)

The Summit of the Americas is supposed to reinforce the hemisphere's commitments to democracy and open markets. It is an opportunity for leaders from north and south to work out common ways of fostering development and prosperity. When the first summit was held 11 years ago, it took place amid hopes of economic convergence.

Sadly last weekend's meeting in the Argentine seaside resort of Mar del Plata provided a stark contrast. It served only to highlight discord and disunity, leaving the US, Mexico, Central America, Colombia and Chile in one camp and Brazil, Argentina and Venezuela in the other. This division reflected new, more sober realities that must be taken into account in fashioning US policies in the region.

The contentious issue was the formation of a free trade zone stretching from Alaska to Tierra del Fuego - the Free Trade Area of the Americas, originally launched in 1994. All but five of the 34 countries signed a clause in a declaration agreeing that talks on the matter should continue next year. But three of the biggest economies - Brazil, Argentina and Venezuela - refused to do so. The time spent on the negotiations and the acrimony of the ex-changes meant there was little time to consider more important issues.

Bush 29, Chavez 5 (Investor's Business Daily, 11/07/05)

If you heeded the hype from gloomy hand wringers or news photos of shop-trashing anti-American thugs, you'd think President Bush left the Argentina summit in failure. It's nothing but rubbish.

Seldom has news been so distorted against facts. Most of the U.S. media claim that because the 34 states were obstructed from full agreement on a declaration to kick-start free trade by a few holdouts, it's some sort of victory for the chief obstructor, U.S. antagonist Hugo Chavez of Venezuela.

Just by the numbers, it's a false impression. Only five states at the Organization of American States summit in Mar del Plata withheld signing a statement to restart talks for a Free Trade of the Americas pact, and four of those — Brazil, Argentina, Paraguay and Uruguay — did so temporarily on valid concerns about farm subsidies.

The U.S. sympathizes with them, but is hamstrung by its larger trade relations with heavily subsidized Europe. That's why the U.S. is going to bat for those four at the World Trade Organization's 148-nation Doha Round of trade talks in Hong Kong this December.

That leaves just Venezuela obstructing free trade, and on ideological grounds. The real story is that 29 very different states — making up 90% of the hemisphere's GDP — endorsed free trade.

[snip]

In the end Bush won because free trade is moving along anyway, summit or no summit. Panama is close to signing its own trade pact with the U.S. The Andean states — Colombia, Ecuador and Peru — are in the last stages of a swift, 18-month effort to hammer out a pact. Besides these smaller, separate deals, the World Trade Organization talks will overtake anything that went on at this summit.

But what about the steel tariffs?