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http:// --> Ashland, Oregon HOME Valley & State Sports Nation & World Opinion/Editorial Classifieds Business Columnists Obituaries Weather Archive Hot Topics Forum Photo Gallery Past Readers Polls Revels Etcetera Backpage O-Zone Special Sections Real Estate Guide Menu Guide Shakespeare Subscribe Contact Us Rate Card Place an Ad Online Games Movie Preview October 21, 2006 Bush pushes free-trade extension for Andean nations By Chris Kraul Los Angeles Times BOGOTA, Colombia — The Bush administration has a prescription for fighting coca growing, sidelining Venezuelan President Hugo Chavez and saving thousands of jobs in Latin America: extending free trade to Andean nations. A senior Bush administration official said this week that the White House would push the U.S. Congress to pass a bill continuing trade benefits for Colombia, Ecuador, Peru and Bolivia under a little-known law. It wants the bill passed during the U.S. Congress' "lame duck session" after the November elections and before the new Congress is sworn in January — while free trade-friendly Republicans still control congress. The administration has acknowledged that an extension of trade preferences would improve frayed diplomatic relations in Latin America while countering Chavez's influence, analysts said. The White House has mounted an 11th-hour campaign to preserve the trade perks, which have generated thousands of jobs, given birth to entire export industries and provided alternatives to drug trafficking. The benefits expire Dec. 31. The Andean Trade Promotion and Drug Eradication Act was initiated in 1991 by then-President George H.W. Bush. U.S.-Colombia trade alone has tripled to $15 billion since 1990, thanks partly to the boom in flower, apparel, liquor and fresh produce industries. Industries from pouched tuna in Ecuador to asparagus in Peru have sprung up to take advantage of special rules that allow products to enter the U.S. market duty-free. Colombian flower exports have grown 10 percent annually since 2002 to $758 million in 2005. Expiration of the trade preferences could deliver a death blow to industries which overnight will lose exemptions on duties ranging from 6 percent to 20 percent. That margin is critical to flower growers here and in Ecuador, which face rising competition from China. Earlier in October, Miami-based Dole Fresh Flowers, a major exporter of roses and other flowers to the United States, announced it was cutting 3,500 jobs at greenhouses in Colombia and Ecuador, partly due to the uncertainty surrounding free trade. The nations involved in ATPDEA accepted that one-way trade preferences eventually would be replaced with bilateral free-trade agreements between the four countries and the United States. The deals would be sealed in international treaties, and U.S. companies would have similar access to Andean markets. But for a variety of reasons, none of the four countries will have individual free-trade agreements in place by year's end. Peru and Colombia both have completed free-trade negotiations with the United States. By December, both will have signed formal agreements which could take months, perhaps a year, to take effect. Negotiations on an Ecuadorean free-trade agreements have stalled for political reasons. Bolivia is not ready for a formal free-trade agreement, but wants an extension of the one-way preferences. Gary Hufbauer, an economist with Washington-based Institute for International Economics, said the White House recognizes that the loss of trade benefits would unduly punish Colombia and Peru, staunch U.S. allies in the drug war, and also "give the populists in Bolivia and in Ecuador more reason to push back against the United States." The White House said it will push Congress for an extension of trade preferences for all four countries even though relations with Ecuador and Bolivia have been strained. Ecuador's state oil company seized an oil field operated by Los Angeles-based Occidental Petroleum. Last June, U.S. embassy officials there said chances of a new free-trade deal, in light of the seizure, were slim at best. But this week, the senior administration official said the United States now believes it's best to "engage" both Ecuador and Bolivia with trade preferences. Sensing the urgency and possible consequences, Organization of American States Secretary-General Jose Miguel Insulza and Inter-American Development Bank President Luis Alberto Moreno, have joined in lobbying the U.S. Congress for the extension. Failure of the U.S. Congress to extend the trade preferences would result in significant losses of Colombian jobs and exports, said Mauricio Reina, an economist with Fedesarrollo, a think tank in Bogota. Four of every five Colombian export-oriented apparel businesses, for example, rely on the trade preferences, as do five of every six businesses that export liquor or tobacco. Those firms would find themselves in immediate financial difficulty, he said. "It's hard to know what percentage would be left out of the U.S. market because it's impossible to know how many companies could absorb that extra tariff they would begin to pay," Reina said. "But it's safe to say that it would be a very important percentage." Leave a Comment: Advertisement: Advertisement: Paid Advertising Inkjet Printers Student Loans Water Filter Helzberg Diamonds Mortgage Calculator Security Systems Advertisement: Copyright © 2006 Ashland Daily Tidings and Ottaway Newspapers. All Rights Reserved.