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Congressional Update: Sense of Urgency on Pending FTAs

March 22, 2011

On March 17, two House of Representatives Subcommittee hearings highlighted congressional impatience with the perceived lack of a timeline for action on the pending free-trade pact with Colombia. Despite consensus on the economic merits of the free-trade agreement (FTA), Republican lawmakers disagreed with Obama administration witnesses and some Democrats on the strategy for ratifying the accord.

Ways and Means Subcommittee on Trade

At the first of a series of three FTA-focused hearings, Chairman of the House Ways and Means Subcommittee on Trade Kevin Brady (R-TX) expressed a sense of urgency in the context of missed opportunities to create U.S. jobs and to maintain a competitive advantage in the region. “While the administration delays, America is being left behind,” Brady said in his opening statement.

The Subcommittee’s Ranking Member, Jim McDermott (D-WA), criticized Republican efforts to move the stalled agreements with Colombia and Panama, including a threat by 54 GOP Senators to block any nominee for Commerce Secretary until President Obama submits the deals to Congress. McDermott recognized Colombia as “a strong, critical ally,” but echoed White House concerns with labor violence and called for an immediate mark-up of the FTA signed with South Korea, without waiting for the conclusion of talks with Panama and Colombia.

Deputy Trade Representative Miriam Sapiro told the Subcommittee that the administration is working to address outstanding concerns, which focus on the protection of labor rights, violence against labor leaders, and the prosecution of the perpetrators. The second administration witness—Under Secretary of State for Economic, Energy, and Agricultural Affairs Robert Hormats—detailed the economic and foreign policy arguments for approving the FTA, with the same caveat: once labor-related concerns have been addressed the pact will move forward.

When pressed by Republican congressman, Sapiro refused to provide a timeline, instead saying that the administration is “working rapidly, in a thoughtful manner, on serious concerns.” Still, Hormats acknowledged the case for urgency, saying: “China is now Colombia’s second largest trading partner. And we are losing market share to Brazil, Canada, and the European Union.” A second panel of witnesses reiterated the need to eliminate tariff barriers that erode the competitiveness of U.S. exports.

Western Hemisphere Subcommittee

An afternoon hearing of the Western Hemisphere Subcommittee of the House Foreign Affairs Committee struck similar notes. Chairman Connie Mack (R-FL) noted Colombia’s improved public security and accused the administration of “successfully stalling the process for reasons unrelated to the importance of security, trade, and commerce.”

The testimony of Ambassador Jim Jones and former Under Secretary of Commerce for International Trade Christopher Padilla (a Council of the Americas Board Member) emphasized the risks of inaction on the Panama and Colombia FTAs. For Padilla, “there is no time to waste.” They did not need to brook any disagreement, as the two Subcommittee members who oppose the FTAs, Representative Eni Faleomavaega (D-American Samoa) and Representative Donald Payne (D-NJ), did not attend the hearing.

Also absent were several Democratic members of Ways and Means, which maintains jurisdiction over trade agreements. Brady indicated his goal of moving forward on all three FTAs by July 1, but the administration will continue to dictate the timetable while addressing “the outstanding issues that have impeded broader support for the Colombian FTA,” in Sapiro’s words. In the meantime, the Ways and Means Committee has the power to deny swift action on the Korea agreement by simply refusing to work on implementing legislation. Those members who support all three agreements hope that their sense of urgency will force action on the entire package.

Note: Council of the Americas plans to submit a statement for the record to the Ways and Means Committee on the importance of approving the Colombia free trade agreement. The Council strongly supports both the Panama and Colombia agreements as tools for achieving the economic growth and prosperity on which the business interests of its members depend.