Latin America Won't Wait for US on Trade

Article excerpt

When President Clinton says he's going to make trade with Latin America a priority in 1998, Latin Americans increasingly respond: "We've heard that before."

In fact, they heard it quite a lot in 1997, when Mr. Clinton took his first trip to South America. Then last month, the president failed to win "fast-track" legislation from Congress. It would have allowed him greater authority in negotiating trade deals with other countries, such as Latin America's tiger, Chile.

Despite the setback and other potentially "chilling" factors - economic turbulence in Asia, and a decided leftward tilt in elections from Mexico to Argentina this year - most observers here do not foresee a halt in deeper trade liberalization accords. Nor do they expect Latin America to retreat from its economic liberalization path - a path that includes continuing privatization of state-owned industries. It's just that this may occur increasingly without US participation. "I don't expect to see any revision of the region's economic reforms, there's really no turning back from that," says Dominique Hachette, an economist at Catholic University of Chile in Santiago. "What we could experience, though, is a weakened role for the United States in Latin America." Chilean Public Works Minister Ricardo Lagos says Clinton's three-year-old proposal for an Americas free-trade area will remain on hold until the US takes the forefront. Calling speculation over waning US leadership exaggerated, the front-runner for Chile's 1999 presidential race nevertheless says, "Until the US makes up its mind on {hemispheric free trade}, the idea won't progress." Clinton himself has cautioned Latin countries not to "overreact" to the setback, promising to resubmit fast-track legislation to Congress early in 1998. His goal remains securing fast-track authority before the second Summit of the Americas in Santiago in April. The summit's primary agenda item is launching formal negotiations toward creation of the free trade area by 2005. But timing for the White House is complex. By March 1, the president must submit an evaluation of drug-producing countries and their cooperation with the US. The "certification" battle always inflames anti-US sentiment in Latin America. But during November's fast-track debate, a growing number of congressmen expressed concern over the relationship between expanded free trade and international drug trafficking. …


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