Trade Issues

What's Ahead for Free Trade?

The derailing of "fast track" trade legislation has put the U.S. in an awkward position, say observers, and may stall a series of free-trade talks which have been in the works for some time.

Progress on agreements that would open markets throughout North America and South America, lower barriers on agricultural trade worldwide and cut tariffs on information technology goods could grind to a halt, trade experts say. They note that trade talks tend to break down if the participants know that any agreement reached will be subject to a multitude of congressional amendments because an administration lacks fast track authority.

Among the discussions that might be affected:

  • The Free Trade Area of the Americas -- which would cut barriers to trade among 34 nations in North and South America by 2005, with most details in place by 2000.

  • World Trade Organization efforts to lower barriers in agriculture, services and other key sectors starting in 1999.

  • Asia Pacific Economic Cooperation talks, which would phase out barriers among Pacific Rim members by 2010 for industrialized countries and by 2020 for developing countries.

  • Information Technology Agreement II, which would expand the current ITA to include more high-tech products and member countries.

Experts point out that some trade deals do not require fast track, since they do not involve changes in U.S. law, which would require congressional approval. In fact, President Clinton has sealed some 100 bilateral trade agreements since fast track authority expired in September 1993.

Source: Adrienne Fox, "Are Free-Trade Deals on Hold?" Investor's Business Daily, November 14, 1997.

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