US - Central America Free Trade Agreement Touted
Trade Official says benefits of accord will be economic and political
WASHINGTON, DC - The creation of the US-Central American Free Trade Agreement (CAFTA) could yield considerable economic and political benefits - not only for the region, but for the entire Western Hemisphere, says Assistant Secretary of State for Western Hemisphere Affairs Roger Noriega.
In recent remarks to the Institute of the Americas, Noriega said the negotiation of CAFTA "is one of the biggest items on the hemispheric agenda, adding that "the ongoing trade negotiations are significant not only because they are addressing sensitive subjects such as labor rights and agriculture rules, but also because the agreement holds great potential for the region."
In view of CAFTA's importance, Noriega said, Washington has given the negotiations "high priority" and established an ambitious schedule for completing the trade agreement with the five participating Central American nations - Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua.
The seventh round of CAFTA talks is currently under way in Managua, Nicaragua with the final round scheduled to take place in Central America in December.
Noriega told the group that the Bush Administration anticipates negotiating the accession by the Dominican Republic to the CAFTA by early 2004, with the White House hoping to submit the complete agreement for congressional approval by mid-2004.
The eventual CAFTA agreement will be "state-of-the-art" and will reflect the latest developments in international trade law," Noriega said, citing the recently concluded US? trade agreements with Chile and Singapore as models for CAFTA.
A significant additional element of the CAFTA, he said, will be trade capacity-building.
"We recognize that the Central American countries and the Dominican Republic need assistance - far more than do Singapore and Chile - to fulfill their new obligations under the CAFTA and to fully exploit the opportunities opened up by the agreement," Noriega said.
He said the ultimate goal of the CAFTA will be to open and integrate the seven member economies, but added that he expects the benefits will be broader.
"The potential impact of the agreement will likely go far beyond trade, giving a major impulse to economic development and political maturity," he said.
Noriega cited Mexico's experience with the North American Free Trade Agreement as an example of the indirect, but important, role that trade can play in opening political systems.
Again citing NAFTA, Noriega concluded that free trade is a powerful tool for economic and political development, but he cautioned that agreements must be complemented by other appropriate policies.
"Business must also adapt in order to succeed in a free-trade environment," he said.
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