THE WALL STREET JOURNAL | By NEIL KING JR. | November 21, 2003
MIAMI -- The U.S. and 33 countries will push toward an Americas-wide trade deal by the end of next year, but the pact may not be as bold as first envisioned.
After the breakdown in global talks two months ago, the U.S. and Brazil papered over their differences and resolved to create a hemispheric pact stretching from Canada to the tip of South America. Although the trade ministers' meeting was scheduled to end Friday, they sped up talks and Thursday night approved a draft accord prepared earlier in the week.
But to get Brazil and other recalcitrant countries to play along, the U.S. backed off its demands that a Free Trade Area of the Americas would be an all-encompassing pact in which everyone lived by the same rules. Instead, ministers agreed to scale back earlier ambitions and to work toward what Brazil insisted on calling a "balanced" agreement. The upshot could mean a pact that disappoints U.S.
business interests that want not only to lower tariffs in the hemisphere, but also wider access for services and new rules on foreign investment and also on intellectual-property protections.
For now, most U.S. business groups are reserving judgment in the hope of pushing the U.S. and others to go further as detailed talks begin early next year. "We will have to evaluate where we are at the end of the process," said Frank Vargo of the National Association of Manufacturers. For many U.S. companies, Brazil is the big prize in any future deal, so few saw the worth in pushing for more ambitious goals now at the risk of causing Latin America's largest economy to balk.
The talks ahead are sure to be difficult, leading some ministers to concede privately that negotiations will probably spill well into 2005.
Success in the Americas talks depends in part on a resumption of the World Trade Organization talks that ran aground in Cancun, Mexico, in September. Without progress on the sticky subject of cutting U.S. agricultural subsidies, for instance, Brazil isn't likely to concede very much in the FTAA discussions in areas that the U.S. wants to pursue, such as foreign investment, government procurement and copyright and patent protection.
But negotiators from the U.S. and Brazil said they hoped their new friendship would help heal some rifts between richer and developing countries that continue to cloud global negotiations.
Despite efforts to put the Miami talks in a positive light, U.S. Trade Representative Robert Zoellick conceded that finishing the deal "remains a tremendous challenge." Write to Neil King Jr. at neil.king@wsj.comTHE WALL STREET JOURNAL:
