AMERICAS: Free Trade Will Require Consensus and Total Commitment

By Mario Osava Reprint | | Print |

Mario Osava

RIO DE JANEIRO, Apr 18 1997 (IPS) - Consensus was reached on eight major points here this week at the third meeting of deputy trade ministers in preparation for negotiations on the Free Trade Area of the Americas (FTAA), but unresolved differences will demand unflagging diplomatic efforts.

That was the conclusion of Brazilian Deputy Foreign Minister Sebastiao do Rego Barros, who informed the press Thursday evening of the results of the four-day gathering of representatives from 25 of the 34 future FTAA member countries.

The participants agreed that the negotiation process for the continent-wide free trade area is to give rise to a single document, to which all member States must completely commit themselves, assuming all the rights and obligations stipulated therein.

No productive sector is to be left out, to start with, and norms of origin must be “clear and predictable,” said Rego Barros.

The officials also agreed that decisions are to be adopted by consensus, and must be completely compatible with World Trade Organisation (WTO) rules and regulations.

But coexistence of the FTAA and subregional or bilateral accords will be accepted.

Two of the points on which consensus was reached left room for varying interpretation, the Brazilian official pointed out. While “the date agreed on was 2005,” it was not made clear whether negotiations are to be concluded at that time, in order for the accord to go into force in 2006, or if the programme of trade liberalisation itself is to go into effect in 2005.

The diplomats agreed that the concrete negotiations for the FTAA are to be launched at the March 1998 presidential summit.

But some countries want the process to begin without prior conditions, said Rego Barros, implicitly referring to the United States and Canada, while members of MERCOSUR (Southern Cone Common Market – Argentina, Brazil, Paraguay and Uruguay) are pushing for “the objectives, focuses, forms and stategies of the negotiations” to be previously defined.

The majority of the discrepancies have to do with that issue, he added.

MERCOSUR wants the negotiations to be broken down into three stages – the facilitation of business, norms and non-tariff barriers, and lastly the elimination of tariffs in continent-wide trade. The United States and Canada, on the other hand, want all questions to be negotiated simultaneously.

A delegate who took a neutral stance on that point predicted that MERCOSUR would yield, in exchange for several concessions, because “there are naturally areas in which more rapid progress is made, and others that lag behind.”

In the end, all the accords will go into force simultaneously, regardless of when agreement was reached, which means the differences regarding the order of the discussions will have limited practical repercussions, he added. But Alfredo Graza Lima, director of the Brazilian Foreign Ministry’s Economic Department, said that could give “wrong signals” to the market.

Other less determinantal discrepancies refer to possible special treament for “small economies,” an as yet undefined category, not equivalent to that of less developed countries.

No agreement was reached on whether or not the recommendations to come out of the trade union forum that will run parallel to the Meeting of Ministers Responsible for Trade in Belo Horizonte next month will be read at the official sessions.

Another unresolved question was whether the secretariat for the negotiating process would be assumed by the Tripartite Committee – the Inter-American Development Bank, Organisation of American States and U.N. Economic Commission for Latin America and the Caribbean – or would be independent, comprised of selected individuals.

Several nations have already proposed their capitals as headquarters for the secretariat, and a deadline of Apr. 30 was set for others wishing to present their candidacies.