Free Trade

April 1, 2003

April 1, 2003

Although I am not very optimistic about the new round of global trade negotiations, I am much more optimistic about negotiation of bilateral agreements. It is so difficult to get every country in the world to agree on a single plan to reduce duties, to harmonize regulatory standards and not get bogged down in an endless harangue about the environment, labor and even animal rights. However, country by country we can and are making progress.

We just concluded a free trade agreement with Chile. Eight-five percent of our trade will face zero import duties from day one. Once the agreement is fully implemented, all bilateral trade will be free oftariffs and quotas. The Chilean ambassador is just delighted and so are we.

U.S. Trade Ambassador Zoellick opened free trade negotiations with the Central American countries of Costa Rico, El Salvador, Guatemala, Honduras and Nicaragua. The first round of negotiations began in January. The objective is to complete the agreement by the end of the year. Our exports to Central America have jumped 42% in the past six years. An agreement will only serve to multiply that growth. Once we complete an agreement with Central America, we will have all of North America tied into a free trade structure. President Bush's vision is to include the entire western hemisphere. Chile is just the beginning in South America and sets the example for the rest.

We should not conclude that all the action is in this hemisphere. Egypt is knocking on our door. Egypt already has an agreement with Europe. As Egypt is a net importer of grain, we don't want to forfeit that business to Europe.

Since the U.S. is such a huge market, I would expect counties all around the world to be standing in line to cut a trade deal with us. That should be good news for the U.S. and especially for the U.S. farmer and rancher.

Until next week, I am John Block reporting from Washington.