Chile Asks Congress To Expand Free Trade

Two years after his nation was promised entry into a major North American trade pact, Chilean President Eduardo Frei on Thursday urged a skeptical United States to keep its word and help write “a new page” in the history of the hemisphere.

“We hope it will not be as difficult to initiate free trade talks as it was so often to initiate peace talks during this century,” the Chilean president said in a rare joint meeting of Congress. “Delays today could mean the weakening of many democracies, a resurgence of closed markets, a consolidation of hunger, and migrations in many corners of the world.”

Insisting in an interview that “I came asking for nothing,” Frei wrapped up his visit to Washington with no firm guarantees as to how or when the administration will seek to negotiate Chile’s entry into the North American Free Trade Agreement (NAFTA), which includes Canada and Mexico.

President Clinton pledged to seek the green light from Congress to begin talks with Chile, but gave no time frame.

“The United States simply cannot afford to sit on the sidelines while others share in the fruits of Latin America’s remarkable growth,” Clinton said on Wednesday. “Chile’s strong record of reform, good government and sound fiscal policies make it an excellent candidate.”

Clinton acknowledged “we have a lot of work to do” to persuade Congress to build on NAFTA, which remains controversial three years after its implementation - particularly among Democrats. Republicans - some of them troubled by Mexico’s recent financial crisis, some of them enjoying the Democrats’ divide - say they are looking for the president to lead.

The two top House Democrats, Minority Leader Richard Gephardt of Missouri and Minority Whip David Bonior of Michigan, this week threatened to fight efforts to expand NAFTA, which they claimed has led to a loss of U.S. jobs and a decline in living standards without improving conditions in Mexico.

“We must be unwilling to compromise or negotiate away the economic interests of our people,” Gephardt said in a letter to colleagues. “… I believe it would be a fundamental mistake to simply extend the current NAFTA. It simply isn’t working.”

For more than two years, the administration has been unwilling to confront such skepticism from its own ranks or bow to Republican demands that any future trade agreement be free of side accords to protect labor rights and the environment. As a result, momentum toward a hemisphere-wide free-trade zone by 2005 has dwindled.

Frei “is testing the waters not only for Chile but for other countries in Latin America that are watching this closely,” said Jack Sweeney, a Latin America policy analyst at the conservative Heritage Foundation.

But Frei made plain that Chile, the economic envy of the continent, has not been waiting idly. With an economy that has grown at an annual rate of 7 percent since 1990, it has thrown open its doors to international investment and signed free trade agreements with Canada and Mexico, and established strong footholds in Asia and Europe.

As world trade increasingly consolidates into blocs, the United States risks losing its natural partners in Latin America if it waits too long, said Tom Drake, a professor of international marketing at the University of Miami.

But Mack McLarty, Clinton’s special envoy for Latin America, vowed the opportunity won’t be missed.

“There’s a growing recognition that economic integration is going ahead,” McLarty said. “We’re going to be left behind if we don’t move forward.”