FTAs with Colombia and Panama Inch toward Approval

As President Barack Obama prepared a State of the Union speech that would focus on the economy and job creation,supporters  of pending trade deals with Panama and Colombia leapt into action. Colombian Vice President Angelino Garzón came to Washington this week to ask Congress to ratify the trade deal. With a Republican majority rekindling interest in trade, the House Ways and Means Committee held a hearing on the pending free trade agreements (FTA) on Tuesday. On Tuesday, Obama made reference to pursuing the two pacts, but his speech fell short of laying out a timetable for passing the Colombia and Panama FTAs.

The Obama administration has already given the green light to the stalled FTAs with South Korea, Colombia, and Panama. The question is: How hard will the White House prod Congress to pass them? Facing an unemployment level that stubbornly refuses to drop below 9 percent, Obama has vowed to ramp up exports as part of a strategy to create jobs. In March, Obama issued an Executive Order creating the National Export Initiative (NEI) , charged with the mission of doubling exports by 2015. One of the key provisions of the NEI is to reduce trade barriers. Obama’s new chief of staff, Bill Daley, worked with the Clinton administration to pass the North American Free Trade Agreement.

But Obama may not be moving fast enough for some. White House Press Secretary Robert Gibbs recently said the administration does not have the votes necessary to pass the FTAs with Colombia and Panama through Congress. In an op-ed for The Washington Post, however, former Assistant Secretary of State for Inter-American Affairs Bernard Aronson writes that there is “no indication that the administration spent any political capital to gain the votes before throwing in the towel.” Vice President of the Council of the Americas Eric Farnsworth argues in the new issue of Americas Quarterly that, while the United States leaves FTAs pending, other countries gain market share that is not easily wrested back. 

The U.S.-Colombia FTA was negotiated during the Bush administration in 2006 and approved by Colombia’s Congress a year later. It continues to await approval by the U.S. Congress to become law, but has faced resistance from Democrats and unions who criticize killings that target Colombian trade unionists and say the agreement contributes to the trade imbalance and American job loss. The United States and Panama pact signed an FTA in 2007 has likewise languished.

But supporters contend that assassinations of Colombian trade unionists has dropped significantly while convictions for the crimes rise. On the economic front, they make the case that FTAs help boost export earnings, spurring job creation and supporting the goals of the NEI. A charticle in the new issue of Americas Quarterly breaks down state-by-state export gains in the United States following major trade pacts—particularly in states where legislators voted against the accords.

Washington's delay has prompted Colombian leaders to look elsewhere for imports. As the head of the Inter-American Development Bank, Luis Alberto Moreno (himself a Colombian) explained in an interview with El Tiempo, “what we’ve seen with the FTA has nothing to do with U.S. foreign policy and everything to do with the Democrat’s union base.” With the U.S. engulfed in anti-free trade sentiment, Moreno said, “it’s time to look around the neighborhood.” 

Last week, Colombian Vice President Garzón also brought up the possibility of looking elsewhere if the U.S. trade deal continued to stall. “Next week, I’ll travel to Washington to ask Congress to approve the FTA,” Garzón said. But the Colombian government will not “sit down and cry” if the deal does not get passed, he added. “Put simply, if business cannot be done with one country, you do it with another.”

Learn more:

• 2011 State of the Union address.
• House of Representatives Ways and Means Comittee January 25, 2011 hearing on pending trade agreements.
• Council of the Americas statement in support of pending free trade agreements before the House Committee on Ways and Means.
• White House announcement of National Export Initiative.
• The Panama Free Trade Agreement at the U.S. Trade Representative’s website.
• The Colombia Free Trade Agreement at the U.S. Trade Representative’s website.
• Eric Farnsworth, "Wake up, Washington!" in Winter 2011 issue of Americas Quarterly.