Southern Exposure

Desde as Entranhas dos Labirintos Latinos.

Saturday, November 15, 2003

Where are we Going Post-Cancun?

Things are changing on the globalisation front, and fast. Yesterday Marcelo was pointing out just how the post default export profile of Argentina has been changing. Today MSNBC looks forward to the next FTAA round, and asks some of the right questions. After Cancun, just where is globalisation heading? Are we going to see a series of bilateral arrangements? If the US drives home an agreement with Brazil, will this de facto set the table for the rest of LA? In an election year what can be done about agricultural subsidies? Is the US really as interested in globalisation as it used to be? Is LA seen as a strategic economic buffer, given the strength of the Asian 'arrival'. For the answers to these, and a number of other tightly interrelated, questions, it seems like we may not have to long to wait: things could get interesting in Miami.

In the minds of security personnel, the upcoming trade block negotiations in Miami will be a success if there are peaceful protests and minimal impact on residents and property. But in the business arena - the key focus of the talks - success will be achieved if two key players, Brazil and the United States, start talking again on some controversial issues.

The two largest economies in Americas must come back to the negotiating table before the Free Trade Area of the Americas (FTAA) can be completed by the self-imposed deadline of January 2005. The sweeping pact would, as proposed, eliminate quotas and tariffs on exports and imports. It would allow a free flow of goods and services across the Americas, except in Cuba. But there are opposing opinions about agricultural subsidies, one of the many controversial issues that must be resolved for the creation of the trade zone.

Those subsidies are at the root of the contention between the United States and Brazil. Their inability to reach consensus brought a September World Trade Organization (WTO) meeting in Canc├║n to an abrupt end. The WTO Ministerial Conference there crumbled before any talks began. As wealthy countries balked at a more equitable trade deal, developing countries, represented by Brazil, walked out of the talks. "They never had a chance to sit down and discuss agriculture to see if any compromise could be reached," said Jeffrey Schott, a senior fellow with the Institute for International Econom-ics, a think tank based in Washington, D.C..

Brazil says the United States is trying to exclude discussions on agricultural subsidies from the FTAA negotiations, said Carl Cira, director of the Summit of the Americas Center at Florida International University in Miami. The United States wants to negotiate the subsidy issue at the WTO level. In return, Brazil is threatening to leave some issues dear to the United States off the bargaining table, Cira said. "Brazil said 'if you can't do anything for us in the agricultural field, then, we can't do anything for you on intellectual property rights, services and government procurement,'" he said His group has been monitoring the FTAA talks since they began about eight years ago. The FTAA process began in December 1994 during the first Summit of the Americas in Miami.

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