There is a growing consensus in Washington that the US-Colombia free trade agreement (FTA) will be ratified this year, after long delays and President Barack Obama’s initial opposition.
Negotiations on the deal began in 2004, in tandem with other Andean nations, and it was signed in November 2006. But Democrats in the US House of Representatives have expressed serious reservations about it, with the leadership using internal mechanisms to keep it from moving to the floor for debate.
Obama expressed concerns about the FTA, and free-trade agreements in general, during the election cycle. But his opposition appears to have softened, according to lawmakers and non-government groups that monitor Latin America.
Colombian authorities said in Medellin this week that they have renewed hope the FTA could be in place by the end of this year.
Congressman Gregory Meeks, a free-trade Democrat from New York, said passage of the Colombia agreement needs to be a priority. “We are very supportive of this agreement, which will help both US and Colombian economies.”
Vicki Gass, who follows trade for the Washington Office on Latin America, said that there is growing interest in moving on Colombia in the Obama administration. She believes, however, that the FTA will come with new conditions that Colombia has to meet to ensure full implementation.
“I think there is definite interest in approving Colombia”, Gass said. “The Obama government will agree to benchmarks that will be above those included in the agreement.”
These benchmarks will relate to hot-button issues that have sidetracked the FTA so far, such as labour rights. US organized labour has lobbied hard against the agreement, citing the huge difficulties faced by unions in Colombia and the number of union leaders who have been assassinated there.
Newly appointed US Trade Representative Ron Kirk cited the benchmarks during congressional testimony for his confirmation.
Congressman Meeks told Emerging Markets that he did not see any problems with the benchmarks, and that the Colombian authorities would also not be opposed, as long as the demands were transparent.
“Colombia has asked the US to tell them what we want”, said Meeks. “They want to know the rules of the game, and will play by those rules. But we need to be clear that those rules will not change.”
Colombian authorities at all levels say the FTA is necessary for the economy, especially in the context of the economic crisis. The Colombian government forecasts 2009 growth of between 0.5% and 1.5%. Private sector forecasts are bearish: Morgan Stanley sees a contraction of 1.6%. Unemployment is now above 14%.
Alfredo Ramos, governor of the Antioquia state, said in Medellin yesterday: “We are very interested in the FTA and we have received encouraging news that it could be approved this year. It will provide us with stability for exports that we do not have under the preferential tariff system.”