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US suspends trade deal with Bolivia

The US is suspending a trade deal with Bolivia, US Secretary of State Condoleezza Rice said on Thursday. She called it unfortunate but necessary because Bolivian President Evo Morales has failed to improve anti-drug efforts.

Rice made the announcement just as Bolivian envoys arrived at the US Trade Representative’s office in Washington to lobby for continued participation in the Andean trade pact, which lowers US tariffs for Colombia, Ecuador, Peru and Bolivia in exchange for cooperation with the US war on drugs.

US President George W. Bush last week signed a six-month extension of the Andean Trade Promotion and Drug Eradication Act, and it wasn’t immediately clear when Bolivia would begin losing out. Rice said the US Congress would decide.

The suspension will raise US tariffs on imports of Bolivian jewelry, textiles, wood and other products. Bolivia estimates that 30,000 workers would lose their jobs and more than US$300 million in exports would be priced out of the US market.

Morales has said his people shouldn’t fear reduced trade with Bolivia’s third-largest trading partner after Brazil and Argentina, but he characterized it as a punitive sanction along the lines of the US embargo against Cuba.

“We don’t have to be afraid of an economic blockade by the United States against the Bolivian people,” Morales said.

Diplomatic relations between the US and Bolivia have soured recently. Morales booted the US ambassador last month, accusing him of supporting his opponents, which the former ambassador denied.

The US sent Bolivia’s top diplomat home in response.

Bolivia also demanded that US development projects and Drug Enforcement Administration officials leave the coca-growing region of Chapare, prompting Washington to place Bolivia on an anti-drug blacklist, which triggered the recommendation by Bush to suspend Bolivia’s participation.

Rice announced the suspension while visiting the resort of Puerto Vallarta to discuss Mexico’s progress against drug cartels.

Bolivian Foreign Minister David Choquehuanca expressed surprise at the announcement, saying his country has been in talks with Washington ahead of next Friday’s deadline for making the decision.

Bolivia “has been one of the countries that has achieved the most results in the fight against drug trafficking, against corruption, against poverty,” Choquehuanca said in La Paz. “I don’t know why the country that has obtained the most results should be punished. For us, this is a political position that the United States is taking.”

In Washington, visiting Bolivian Finance Minister Luis Alberto Arce called the tariffs an injustice.

Arce met with US Senator Dick Lugar, a leading Republican in foreign affairs matters, who called for continuing trade preferences to support Morales’ progress in reaching a constitutional compromise with his opponents.

This is a critical moment in US-Bolivian relations, Lugar said, and more engagement, not less, is what both countries need.


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