AMERICAS-TRADE: Small Economies, a Hot Issue in FTAA Talks

By Estrella Gutiérrez Reprint | | Print |

Estrella Gutierrez

CARACAS, May 15 1997 (IPS) - The asymmetrical treatment that the small economies of Latin America and the Caribbean will need in order to participate in the Free Trade Area of the Americas (FTAA) is one of the most charged issues for the trade ministers of the 34 countries involved in the mega-project.

The question is so complex that the working group on the smallest economies in the hemisphere has come to the eastern Brazilian city of Belo Horizonte, where the trade ministers are meeting Thursday and Friday, without even having specifically defined which countries are to be assigned to that category.

In the Americas, the world’s leading power coexists alongside some of the world’s smallest economies, which according to negotiators makes a uniform opening of trade non-viable.

The five proposals presented so far by groups or nations on how the free trade area should be negotiated differ with respect to the most suitable way of dealing with the asymmetries.

At a special April meeting of the working group on the smallest economies held in the Guatemalan city of Antigua, it was agreed that the rights and obligations of the FTAA were to be undertaken by all 34 countries.

But the group underlined the need to offer opportunities facilitating the integration of the smallest economies into the FTAA, to be determined on a case by case basis – including technts own free trade zone, which has set goals for tariff reductions beyond the year 2005.

Others, like the United States, want the discussions to go ahead as fast as possible, with a 2003 deadline for the conclusion of the talks. Yet others wouin December 1994. This week’s gathering is the third ministerial-level meeting of the preparatory stage, which is to culminate with the launching of formal negotiations in March 1998, at the second Summit of the Americas in Santiago.

The negotiation process is to conclude by the year 2005 at the latest as decided in Miami. But groups like the Southern Common Market (Mercosur) would like the question of tariff cutting to be dealt with last, which would give the bloc time to consolidate its own free trade zone, which has set goals for tariff reductions beyond the year 2005.

Others, like the United States, want the discussions to go ahead as fast as possible, with a 2003 deadline for the conclusion ns to go ahead as fast as possible, with a 2003 deadline for the co