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All Stick – When a Carrot — and a Conscience Would Do

Incredibly, the Bush Administration has apparently decided to threaten poor countries, particularly those in our own hemisphere, with debilitating trade restrictions unless they support the US negotiating position in World Trade Organization talks.

During testimony at a Ways and Means Committee hearing, the USTR was silent on whether the Congress should extend, as it has in the past, two trade programs for poor countries that expire at year’s end: the Andean Trade Promotion Act (ATPA) and the Generalized System of Preferences (GSP). ATPA extends duty-free treatment to imports from Colombia, Peru, Ecuador, and Bolivia.

In silence, the Administration shouted a threat to tilt global trade policy off axis, with harsh ramifications for poor nations struggling to stand on their own. This is not a carrot and stick approach. It is all stick, when a carrot and a conscience would serve us and the world better.

While the Bush Administration has reached free trade agreements with Peru and Colombia, it’s not likely either of the agreements can be implemented before ATPA’s expiration. Expiration of this program would mean that tariffs on products from the Andean region would immediately climb and close the American market to many legal Andean products, making illicit agricultural production, specifically cocaine, the only viable option in some cases.

GSP provides duty-free treatment to a majority of products from developing nations. Expiration of this program would affect the world’s poorest countries and also increase the cost of products imported by American businesses and passed on to American consumers.

A year ago, the world joined together in advance of the G-8 Summit in Scotland to pressure world leaders to make global poverty history. Today, on the eve of another G-8 Summit, the Bush Administration suggests that we will punish poor countries if they don’t kowtow to the US trade position within the WTO. What a way to show global leadership.

Tags Andean Trade Promotion and Drug Eradication Act Economy of Colombia Economy of South America Generalized System of Preferences International trade Peru–United States Trade Promotion Agreement Politics World Trade Organization

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