Economy & Trade, Global, Global Geopolitics, Headlines, North America

TRADE: U.S. Complains that Many Partners Erecting Barriers

Emad Mekay

WASHINGTON, Apr 2 2004 (IPS) - The Bush administration is warning it might act against trading partners that continue to impose barriers on U.S. goods and services, but the Democratic opposition calls the threat a bluff.

In its annual ‘National Trade Estimate (NTE) Report on Foreign Trade Barriers’, the administration warns that trade constraints limit commercial opportunities for U.S. businesses and also undermine any possible gains to developing countries from liberalised global trade.

The 2004 NTE includes a list of "unfair trade practices" used to block U.S. exports of goods, services and farm products. The 502-page report covers 58 major trading partners in each region of the world.

On the list are such barriers as tariffs, import licensing, environmental measures, refusal to accept U.S. manufacturers’ self-certification that they conform to foreign product standards, ‘buy national’ policies and closed bidding systems.

"American workers, exporters, farmers and businesses continue to face barriers for our world-class goods and services," said U.S. Trade Representative (USTR) Robert B. Zoellick.

"Day in and day out, all around the world, the U.S. government is working aggressively to make sure barriers to U.S. goods and services are removed. The NTE report is a useful inventory of global trade barriers to understand what has been accomplished and what more needs to be done," he added in a statement.

The United States itself is widely criticised for unfairly subsidising its farmers and for not opening its markets to exporters, particularly from developing countries, a move the World Bank says is a sure way to help end poverty and to put millions of impoverished farmers in the developing South back to business.

Opposition Democrats here also criticised the administration for doing little to counter the findings of the report, saying the NTE is proof of officials’ continuing failure to act against unfair trading practices.

On Thursday the Democrats wrote to President George W. Bush urging him to take instant measures to remove the "unfair trade barriers" standing in the way of U.S. exports.

"After the loss of almost three million manufacturing jobs since January 2001 and the growing problem of outsourcing in the services sector, it is time to stop taking inventory and time to start producing results for American workers, farmers and businesses," said the letter.

It was signed by House of Representatives Democratic Leader Nancy Pelosi, House Democratic Whip Steny Hoyer and Rep Charles B. Rangel, among others.

A presidential election is scheduled for November and Bush’s record on creating, and maintaining, jobs is shaping up to be a critical issue.

The letter urges the administration to direct the USTR to kick-start immediate talks with five key U.S. trading partners – China, the European Union, Japan, South Korea and India – and to file in the World Trade Organisation (WTO) within 60 days cases against seven other countries if negotiations with them do not resolve existing barriers.

The National Association of Manufacturers, the country’s largest industrial trade association, sided with the Democrats, urging Bush to fight for equal treatment in the trade arena.

"We strongly favour open markets for the sale of U.S. goods, but we must also insist that our government press for a level playing field and vigorously enforce international trading rules for both market and non-market economies," NAM said in a statement Friday.

The administration argues it has a solid enforcement record, including WTO rulings against: Canada’s export subsidies on dairy products; India’s restrictions on U.S. exports of auto assemblies; and an agreement with Argentina resolving many of the issues raised in a dispute over aspects of the Latin American nation’s intellectual property regime.

More recently, Washington received a favourable dispute ruling from the WTO against Japanese barriers to apple imports and favourable preliminary findings against Mexico’s telecommunications regime.

But in a teleconference about the report, U.S. trade officials, who asked not to be named, said they prefer negotiating and consulting to filing cases at the WTO as a way of solving trade disputes.

In their letter the Democrats wrote, "in the three years the Bush administration has been in office, USTR has brought an average of fewer than three cases per year in the WTO. By contrast, the (previous Democratic) Clinton administration brought approximately 10 cases per year in the WTO".

Zoellick countered that his department employs a variety of tools to ensure U.S. exports are treated fairly, "from consultations to negotiations to litigation".

"Trade liberalisation itself provides a win-win opportunity to lower barriers and promote economic growth and development," he added pointing to a number of free trade agreements his office has initiated.

Washington has completed negotiations on agreements with Morocco, Australia, and four Central American countries.

It is also negotiating free trade agreements (FTAs) with the Southern African Customs Union (South Africa, Botswana, Namibia, Lesotho and Swaziland) and is working to bring the Dominican Republic into the recent Central American FTA.

Washington has also announced it intends to begin talks with Thailand, Colombia, Peru, Ecuador, Bolivia and Panama.

Talks on a hemispheric-wide Free Trade Area of the Americas (FTAA) stalled after the latest meeting last November in Miami, particularly over U.S. refusal to give up its support to farmers.

Zoellick says the best remedy to trade barriers is to forge ahead with more free trade deals, which include enforcement clauses on barriers.

"Indeed, enforcement is inherently connected to the process of negotiating new agreements," he added. "Virtually everything USTR does is connected with enforcement in some way. Negotiations to open markets and enforcement are two sides of the same coin."

But the Democrats argue that simply signing a trade agreement and moving on to negotiate the next one is not adequate. "To restore credibility to the trading system, agreements have to be enforced," said their letter to Bush.