WWD.com/beauty-industry-news/financial/cafta-contingent-mulls-bush-plan-574867/
government-trade
government-trade

CAFTA Contingent Mulls Bush Plan

Latin American leaders said at the White House that they weren't sold on the administration's proposed modifications to CAFTA.

WASHINGTON — Latin American leaders, wrapping up a lobbying blitz for the Central American Free Trade Agreement, said they weren’t sold on whether to support the Bush administration’s proposed modification to a textile and apparel provision in the accord.

The 10-day tour by the presidents of Guatemala, Nicaragua, Honduras, El Salvador, Costa Rica and the Dominican Republic, which took them from North Carolina to Capitol Hill, culminated in a White House meeting and ceremony with President Bush Thursday.

Guatemalan President Oscar Berger said in an interview after the Rose Garden ceremony that his government is “still analyzing” the administration’s pledge to seek a modification to require that pocketing and linings fabrics be supplied by the U.S. or the six signatory countries in order to be exported duty-free.

“The problem is we have the treaty [ratified] and for us it will be very tough if there are some changes made,” said Marcio Cuevas Quezada, Guatemala’s minister of economy. “If they open it for negotiation, Guatemala will of course have something to negotiate also.”

At a U.S. Chamber of Commerce event Tuesday night, Dominican Republic President Leonel Fernandez, said: “We’re hearing some proposals about future amendments.” Asked whether he would oppose such a change, Fernandez replied: “First you get the bill approved.”

That pledge to amend pocketing and lining provision made by U.S. Trade Representative Rob Portman to Sen. Elizabeth Dole (R., N.C.) was a key factor in securing support for the trade pact from a major U.S. textile lobbying association. The administration is trying to galvanize support for CAFTA in Congress.

The USTR office had no comment on Thursday.

In order to amend the pocketing and linings provision, all of the countries involved in the trade deal must agree to the modification and hold consultations.

Auggie Tantillo, executive director of the American Manufacturing Trade Action Coalition, which opposes CAFTA, said the administration needs to get commitments from the six presidents while they are in town or risk losing an opportunity to change the pocketing and lining provision.

“Who thinks they will have any leverage to fix this after the agreement has been passed?” he asked rhetorically. “You have a process where one country can object and therefore derail any amendment. On top of that, once the agreement has passed, the price for making such changes and fixes goes through the roof.”

On Capitol Hill, meanwhile, Sens. Lindsey Graham (R., S.C.) and Byron Dorgan (D., N.D.) told reporters they were skeptical about pledges to tweak the already negotiated agreement.

The two spoke out against CAFTA just as Bush sought to drum up support at the White House.

“There’s a movement among southern senators to try to do something about the pocket problem,” said Graham. “There’s a commitment by Rob Portman to try and deal with that. Well, all seven nations have to agree. I think it would be irresponsible on our part to go forward with a vote on CAFTA until we know how these seven nations are going to treat this problem.”

Dorgan said there was no question as to what would happen as a vote on CAFTA neared.

“They will offer us letters, side agreements and all kinds of concoctions, which as we know mean nothing,” he said. “It’s all smoke and mirrors. We’ve been through all of that. All of that is an excuse for the failure to negotiate a good agreement that represents our country’s best interests.”