Joshua Goodman with Bloomberg online reports that Senate Foreign Relations Committee Ranking Member Richard Lugar (IN) introduced a bill that would extend U.S. trade benefits to Uruguay. It is a move Lugar hopes will “increase pressure on Brazil to deepen commercial ties.”The bill is S.1665 and its title line reads “A bill to amend the Andean Trade Preference Act to add Paraguay and Uruguay to the list of countries that are eligible to be designated as beneficiary countries and ATDEA beneficiary countries, and for other purposes.” The legislation currently has no cosponsors, but it was only introduced on Monday. You can access the text of the legislation by clicking here.
As the title line indicates, this bill would allow Uruguay to a part of the Andean Trade Promotion and Drug Eradication Act, an act that will expire this year. Goodman reports that following the bill’s introduction Senator Lugar met in Washington, DC with the president of Uruguay, Tabare Vazquez. Senator Lugar is involved in legislative efforts that are intended “to assist U.S. anti-narcotic efforts,” by giving countries duty free access. The legislation could be very beneficial to the South American countries that, Goodman reports, have become frustrated by the Mercosur trade block continuing to be “dominated” by Brazil and Argentina.
Goodman reports that Senator Lugar’s staff has put together a report that” recommends bypassing Mercosur’s common external tariff, which prevents members from signing individual free trade agreements, by granting trade privileges unilaterally to Uruguay.” The motivation behind the legislation, according to Goodman, is to make a statement about U.S. interests in the region and to try and encourage ‘“reluctant countr[ies] to expand their trade relations with the U.S.”’
The main target of the report by Lugar’s staff is Brazil, “Latin America’s largest economy.” Previously the United States has tried to put together a “hemisphere-wide trade accord,” only to be met with objects from Brazilian President Luiz Inacio Lula da Silva over U.S. farm subsidies. The subsidies “were blamed for the breakdown in 2005 of decade-long talks on a free trade zone stretching from Alaska to Tierra del Fuego.”
The Brazilian president is also a former union leader. Lately, according to Goodman’s article, the Brazilian president has been active in trying to get the stalled Doha negotiations going again. One way he is trying to do this is by easing his stance on agriculture. It is worth mentioning that this year, “China replaced the U.S. as Brazil’s largest trading partner.”
To read Mr. Goodman’s article click here.
Posted: 09/16/09
