White House Announces CAFTA Start with El Salvador in March

A free trade agreement with El Salvador will take effect March 1, the Bush administration announced Friday, leaving behind for the moment five other Latin American nations that are supposed to be part of the Central American Free Trade Agreement.

U.S. Trade Representative Rob Portman praised El Salvador for the strides it has made in revising laws and regulations necessary to meet the commitments it made in CAFTA.

Costa Rica, the Dominican Republic, Guatemala, Honduras and Nicaragua are the other nations in CAFTA, which won congressional approval after a hard-fought battle last year.

It had been expected that the agreement would take effect Jan. 1, but it has run into a series of obstacles as different countries have had trouble passing legislation needed to implement the commitments to lower trade barriers and provide greater protection for copyrights and patents, a key U.S. demand.

Jeffrey Schott, a trade expert at the Institute for International Economics, said the delays would likely prove temporary as presidents of the other CAFTA countries win approval of the needed legal and regulatory changes.

“If any country delays implementation, it will undercut the advantages that country will receive from greater economic integration not only with the United States but with other countries in the region,” he said.

The legislation to implement CAFTA was signed into law by President Bush in August after a congressional battle. It won House passage by only two votes last July.

Democratic critics contended the deal would expose American workers to unfair competition from low-wage nations and would hasten the movement of U.S. manufacturing jobs overseas.

Some Latin American officials have complained that the United States is making unfair demands for changes in their regulations and laws governing such areas as the protection of copyrights and patents.

Lacs said the U.S. negotiating team still wants more side agreements with Guatemala, including lifting restrictions on the importation of antennas and other telecommunications equipment.

U.S. trade with El Salvador last year included U.S. exports of $1.85 billion, putting the country in 50th place as a market for U.S. goods. Imports from El Salvador totaled $1.99 billion last year, with clothing one of the biggest import categories.