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The U.S.-Central America Free Trade Agreement (CAFTA): Challenges for Sub-Regional Integration
| Content Provider | Semantic Scholar |
|---|---|
| Author | Hornbeck, Jeremy |
| Copyright Year | 2003 |
| Abstract | Nicaragua. In addition, the Dominican Republic concluded a similar bilateral free trade agreement (FTA) with the United States on March 15, 2004, which is expected to be signed in July 2004 and integrated with CAFTA to be considered as a single legislative package. Enacting the agreement requires the U.S. Congress to pass implementing legislation and that similar action be undertaken in the other countries. As required under Trade Promotion Authority (TPA) legislation (P.L. 107-210), prior to any congressional consideration of implementing legislation, the Bush Administration is required to send to Congress supporting materials within 60 days of entering into the agreement. CAFTA was negotiated, in part, as a regional agreement in which all parties would be subject to the " the same set of obligations and commitments, " but with each country defining its own separate schedules for market access on a bilateral basis. The flexibility of this framework allowed Costa Rica to negotiate longer, and for a slightly different arrangement than the other four Central American countries, each of which also negotiated separate schedules. It also allows for the Dominican Republic to be added at a later date. CAFTA is a comprehensive and reciprocal trade agreement, which distinguishes it from the CBI unilateral preferential arrangement between the United States and these countries. It defines detailed rules that would govern market access of goods, as well as services trade, government procurement, intellectual property, and investment. Under CAFTA, more than 80% of U.S. consumer and industrial exports and over half of U.S. farm exports to Central America would become duty-free immediately. To address asymmetrical development and transition issues, CAFTA specifies rules for lengthy tariff phase-out schedules as well as transitional safeguards and tariff rate quotas (TRQs) for sensitive goods. Although many goods would attain immediate duty-free treatment, others would have tariffs phased out incrementally so that duty-free treatment is reached in 5, 10, 15, or 20 years from the time the agreement takes effect. Duty-free treatment would be delayed for the more sensitive products, and in some cases, the tariff reductions would not begin until 7 or 12 years into the agreement. CAFTA is controversial and faces political uncertainty. Supporters hope that CAFTA can be part of a policy foundation supportive of both improved intra-regional trade and long-term social, political, and economic development. Concerns remain, however, over the negative effects on certain sectors and employees of the U.S. economy, and that … |
| File Format | PDF HTM / HTML |
| Alternate Webpage(s) | http://fpc.state.gov/documents/organization/33747.pdf |
| Alternate Webpage(s) | https://digital.library.unt.edu/ark:/67531/metacrs6537/m1/1/high_res_d/RL31870_2003Apr25.pdf |
| Alternate Webpage(s) | http://www.iwar.org.uk/news-archive/crs/20484.pdf |
| Language | English |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
