Zoellick Wants Fast Track; U.S. Lagging

May 11, 2001

U.S. Trade Representative Robert B. Zoellick, testifying before the Subcommittee on Trade, House Committee on Ways & Means earlier this week said the United States is falling behind in finalizing trade agreements. Of the 130 free trade agreements that now exist, the United States is a party to just two – the North American Free Trade Agreement and one with Israel.

The European Union has free trade or special customs agreements with 27 countries, 20 of which it completed in the last 10 years. And the EU is negotiating another 15 accords right now. Last year, the European Union and Mexico - the second-largest market for American exports - entered into a free trade agreement. Japan is negotiating a free trade agreement with Singapore, and is exploring free trade agreements with Mexico, Korea, and Chile, Zoellick said.

"We have no one to blame for falling behind but ourselves," he told the panel. "And there is a price to pay for our delay ... during the last century, when it came time for countries to adopt standards for the great innovation of that era - electric power - Brazil turned to European models because the United States was not active in Brazil. So when you visit Brazil, be sure to bring an electric adapter." Brazil is making decisions about standards for autos and other products - so the United States needs to decide whether it wants to stand on the sidelines again, he added.

"Our inaction hurts American businesses, workers, and farmers, as they find themselves shut out of the many preferential trade and investment agreements negotiated by our trading partners. To cite just one example, while U.S. exports to Chile face an eight percent tariff, the Canada-Chile trade agreement will free Canadian imports of this duty. As a result, U.S. wheat and potato farmers are now losing market share in Chile to Canadian exports," Zoellick noted.

The Bush Administration's top trade priority is for Congress to enact trade promotion authority, also known as fast track, by the end of the year. Under this authority, the executive branch would be bound by law to consult regularly and in detail with members of Congress as trade agreements are being negotiated. "But once that long and exhaustive process of consultations is completed, and the painstaking negotiations have ended in an agreement, our trading partners have the right to know that Congress will vote on the agreement up or down. Indeed, in the absence of (this) authority, which expired in 1994, other countries have been reluctant to close out complex and politically sensitive trade agreements with the United States," he said.