WASHINGTON (Reuters) - The United States on Tuesday made what it called a bold proposal to open its markets to more goods from Latin America and the Caribbean, including eliminating tariffs on textiles and clothing within five years.
The Bush administration made the offer as part of the negotiations on the proposed Free Trade Area of the Americas agreement, which would create a $13 trillion free trade zone covering 34 countries and nearly 800 million people.
"President (George W.) Bush has made the FTAA a top U.S. priority and today we deliver with bold proposals to lower barriers throughout the region," U.S. Trade Representative Robert Zoellick said. "We're putting all our tariffs on the table and are ready to move forward with others that are ready to do the same."
The U.S. proposal would eliminate tariffs on textiles and apparel products made in the region within five years, providing other countries do the same.
It would also provide immediate duty-free access for about 56 percent of farm goods and 65 percent of industrial and consumer goods from Latin America and the Caribbean once the FTAA goes into effect.
The current goal for concluding the trade pact is Jan. 1, 2005. But any agreement must be approved by Congress and legislatures in the 33 other countries before taking effect.
Zoellick said he hoped the U.S. proposal would encourage equally bold offers from others in the region.
Countries face a Feb. 15 deadline for making first offers in market access talks covering industrial and consumer goods, agriculture, investment, services and government procurement.
The U.S. offer to phase out tariffs on textile and apparel goods from Latin America and the Caribbean comes as the U.S. textile industry already is worried about increased foreign competition after import quotas are eliminated in 2005.
An expected flood of imports from China also could squeeze out other suppliers in the Caribbean and Latin America.
Zoellick said the U.S. offer would promote integration in the Western Hemisphere textile industry and put it in a better position to compete with China.
"Part of the reason we're trying to move on this is ... is to help the efficiency of the Americas vis-a-vis the rest of the world," he said.
The U.S. proposal would phase out tariffs on Western Hemisphere farm goods over four different time periods, with 56 percent being eliminated once the pact goes into effect.
Other farm tariffs would be phased out over periods of five, 10 or even more years.
Citrus and sugar -- two politically sensitive commodities of great interest to Brazil -- would be among those products with the longest time frames, Zoellick said.
The United States also has tailored its agricultural offer so that the poorest countries in the hemisphere would receive the most immediate benefits.
Countries in the Caribbean would gain immediate duty-free access for 85 percent of their farm product trade, while Brazil and other Mercosur members would get immediate duty-free treatment on just 50 percent of their farm goods.
However, Zoellick emphasized the United States was willing to eventually eliminate tariffs on all farm goods, if others are prepared to do the same.
"By putting all our own goods on the table for negotiation, we're trying to signal to our trading partners our expectation that they will offer significant market access to America's farm products," such as wheat, beef and potatoes, he said.
The United States also proposed immediately eliminating tariffs on certain industrial and consumer goods, on a reciprocal basis, once the FTAA goes into effect.
Those include chemicals, construction and mining equipment, electrical equipment, energy products, environmental products, information technology, medical equipment, non-woven fabric, paper, steel and wood products. Altogether, the U.S. proposal would immediately eliminate tariffs on 65 percent of industrial and consumer goods trade, with the rest phased-out by 2015, Zoellick said.
The U.S. proposal also would open the U.S. government procurement market to more Latin American and Caribbean companies and lower barriers in the services sectors, including such areas as financial services, telecommunications, tourism and energy.
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