Sun, Nov 23, 2003 page11

• Brazil calls Miami talks `stage-setting'

  FOUNDATION South America's largest nation said that the hemispheric free trade area negotiations in Miami last week were neither a victory nor a disaster

  • REUTERS
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  Brazil's agriculture minister on Friday said a Miami meeting to build an Americas free trade area was neither a victory nor disaster but set the stage for tough talks on whether a pact could be built.

  Roberto Rodrigues said the 34 nations in the Americas -- all but Cuba -- still had to hammer out a deal to build the world's biggest trade zone and tackle thorny issues like compensation for US domestic farm subsidies.

  

  A US Embassy security officer looks at corn strewn on the ground, thrown by members of the Rural Landless Workers' Movement (MST), in front of the US Embassy's gate, during a protest in Brasilia, Brazil on Friday. The MST were protesting against the proposed Free Trade Area of the Americas, or FTAA.

  PHOTO: AP

  "What I'm saying is not that we had a victory, but that we did not have a disaster," said Rodrigues on a conference call from Miami. "We reached a pretty far-reaching and ambitious accord in terms of the document. But real negotiations start from now."

  The plan agreed on calls for a diluted version of the pact in which all participants would agree to minimum levels of commitments in a range of negotiating areas.

  It would allow groups of countries that want more commitments to seek separate bilateral and regional deals.

  The pact has variously been called FTAA "Lite," FTAA "a la carte," and even "a nine-course meal" by US Trade Representative Robert Zoellick.

  For Brazilian trade specialist Marcos Jank it looked like a "plate of spaghetti."

  Jank said the deal prevented a collapse of the Miami talks but would create a jumble of bilateral trade deals.

  That would rob the FTAA of its original plan to give the most favorable terms to all nations and resolve all issues in a single pact, he said.

  "I think the countries saved the Miami meeting but they didn't save the FTAA," said Jank, a professor at the University of Sao Paulo.

  "The amount of work that needs to be done between now and the next [trade ministers'] meeting in Brazil is pretty overwhelming," said Jeffrey Schott, a trade policy expert with the Institute for International Economics in Washington.

  Many in Brazilian business and agriculture were less concerned about the route to continental free trade than access to lucrative US farm markets for Brazil's cheap agricultural exports.

  Trade consultant Helio Mauro Franca saw it as a way for Brazil and the US to resolve differences and allow nations like Canada, Mexico and Chile to seek the far-reaching deals they are after.

  "It was a victory for the group because at least negotiations will go on," said Mauro Franca, deputy secretary of trade under Brazil's former government.

  Before Miami, Brazil and the other nations in the Mercosur trade bloc -- Argentina, Uruguay and Paraguay -- refused to negotiate US priority areas of investment, services, government procurement and copyright protection unless the US discussed its domestic farm subsidies.

  US domestic subsidies will be discussed at the WTO. Brazil will also seek compensation for the subsidies it claims generate surpluses that are dumped onto world markets, distorting trade.

  In compensation for the subsidies, Brazil is seeking lower US quotas on big exports like sugar, ethanol and meats as well as a lower tariff on orange juice.

  "The FTAA remains alive, it's guaranteed, but the negotiations themselves will decide what happens from here on in," said Rodrigues. "It's still not certain that the dream [FTAA] will become a reality."

  In the US, leading lawmakers said the plan would only work if Brazil and other countries agree to a high level of basic commitments in each area.

  Montana Sen. Max Baucus, the top Democrat on the Senate Finance Committee, said any FTAA "that falls short of a comprehensive and ambitious set of common obligations will face a difficult road toward congressional approval."

  House Ways and Means Committee Chairman Bill Thomas, an Illinois Republican, was more blunt and said Congress would reject a "lackluster, mediocre agreement."
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