1. Zoellick Says FTA Candidates Must Support U.S. Foreign Policy
2. USTR Agenda Spread Over Multiple Fronts
3. MEAA launches new campaign on USFTA / US Words No Comfort For Aussie Film and Television Industry
4. Reminder: GATS and USFTA training: Sydney, 1 July
5. George Monbiot speaks in Sydney

1. Zoellick Says FTA Candidates Must Support U.S. Foreign Policy

Inside US Trade
May 16, 2003

U.S. Trade Representative Robert Zoellick late last week said countries that seek free-trade agreements with the United States must pass muster on more than trade and economic criteria in order to be eligible. At a minimum, these countries must cooperate with the United States on its foreign policy and national security goals, as part of 13 criteria that will guide the U.S. selection of potential FTA partners, he said in a May 8 speech.

The U.S. seeks "cooperation -- or better--on foreign policy and security issues," Zoellick said in a speech to the Institute for International Economics. Given that the U.S. has international interests beyond trade, "why not try to urge people to support our overall policies?" he asked. Zoellick said that he uses a set of 13 criteria to evaluate potential negotiating partners, but he insisted that there are no formal rules for the selection or any guarantees. "It's not automatic," Zoellick said. Negotiating an FTA with the U.S. "is not something one has a right to. It's a privilege."

He made the speech one day before President Bush announced a new Middle East initiative that seeks to create a free-trade area by 2013 as a way to back U.S. foreign policy goals in the region. The announcement was made without consultations with congressional staff on either side of the aisle. According to Zoellick, the selection criteria take into account whether a potential partner has been supportive of the U.S. in the World Trade Organization and the Free Trade Area of the Americas. The United States does not demand complete support for its positions in the WTO from a potential candidate but at least "a problem solving process" to work out disagreements.

Zoellick also said the U.S. sees more value in negotiating free trade agreements if such a deal can help motivate broader social changes in a nation, such as promoting democracy and openness. Other factors in the selection are whether a trade deal can serve as a catalyst to economic reforms in that nation and can counter favorable bilateral trade deals between key countries and other world economic powers, he said. And he pointed out that since any trade agreement has to be approved by Congress "we look to congressional interest, or, on the other hand, opposition," when choosing partners for a free trade agreement. For instance, in the case of the Caribbean Basin Trade Partnership Act and the African Growth and Opportunity Act in 2000, Congress expressed its interest in these initiatives with countries in these regions. The Administration is currently pursuing an FTA with Central American countries that is controversial in Congress because of countries' abuse of worker rights.

By the same token, Zoellick said, negotiating a free trade agreement with an African or Latin American nation helps build support for free trade generally among blacks and Latinos in the U.S. Similarly, he said it is important that there is support among U.S. business and agricultural groups for a given trade agreement. However, in the case of Australia, the Bush Administration pursued an FTA despite strong opposition from U.S. agricultural groups, even Republican constituencies like the National Cattlemen's Association.

He said that an FTA must consider "special product sensitivities" for U.S. products that must be considered when choosing potential trading partners, and nations must be willing to negotiate a comprehensive trade agreement, covering every sector. Trading partners may also be strategically chosen to help build broader relationships within a region, Zoellick said. This is the case if an FTA with one country could serve as an anchor for many in the region. "We're exploring with Congress the idea of docking agreements," he said. This means the U.S. would negotiate a deal with one nation and another country in the region "could join into the basic set of rules and structure--probably with a separate market access agreement." Zoellick said.

"That could be good, say, in the Gulf region if you have one Gulf state lead and others might be able to follow." Zoellick noted several times in his speech that Bahrain stands out as a nation in that region with which the U.S. made good progress in trade talks and that country is seen by informed sources as one with which the U.S. could begin negotiating an FTA as early as this year. Zoellick also said, "we're working very, very hard with Egypt" and described the nation as one of the "serious candidates for something that if we approach, we may do so in a way that also looks towards a deeper integration of the region." He also said the U.S. has an interest in having trade agreements in every region of the world and that he is personally interested in having deals with both developed and developing nations. He also noted that USTR faces resource constraints that limit the number of agreements it can negotiate simultaneously.

At the same time, USTR apparently is withholding FTAs based on previous foreign policy disagreements. According to informed sources, a senior USTR official told foreign officials this spring that the Bush Administration has a "long memory" of what it sees as other countries' transgressions. He said that the U.S. will therefore not offer an FTA to New Zealand, which has refused to let nuclear powered vessels enter their waters, according to these sources.

Zoellick said he does not anticipate a single free trade agreement between the U.S. and the Association of Southeast Asian Nations, though he said the U.S. is taking steps toward agreements with individual ASEAN nations. An ASEAN-wide free trade agreement was proposed by the prior Bush administration. "The balance that we've had to strike is, do we wait until all countries are ready, or do we start with some and offer a pathway to others," Zoellick said. Zoellick said the U.S. has begun with the notion that ASEAN countries must have a trade and investment framework agreement (TIFA) with the U.S. to be eligible for an FTA. USTR sees TIFAs as a forum to solve trade problems and to promote economic reforms, and has TIFAs with Thailand, Indonesia and the Philippines. He also said "we've had good progress with Sri Lanka." He said that the goal is to have an ASEAN-wide work program to deal with specific issues such as intellectual property rights.

Several industry sources said Thailand is among the most likely candidates for a free trade agreement. The TIFA signed last year included an annex suggesting that at the appropriate time, the two nations may begin discussions on a possible FTA. The Thai prime minister is expected to visit the U.S. next month and is expected to raise the possibility of an FTA then. The U.S. Chamber of Commerce has begun a study of the feasibility of a U.S. Thailand FTA, with the goal of reporting this summer on whether there is enough political support or support from the private-sector in both countries to make such an agreement feasible.

But several sources suggested this week that after President Bush's announcement that he wants to pursue a regional trade agreement in the Middle East, Thailand and other Asian nations may have dropped lower on the priority list. Zoellick also cautioned that work on an FTA with the South African Customs Union is a difficult one given the different levels of development in those countries, so "that maybe will go a little slower."

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2. USTR Agenda Spread Over Multiple Fronts

The Bush administration's strategy of moving simultaneously with trade liberalization on the bilateral, regional, and multilateral fronts ensures that no one country can block the U.S. trade agenda, Josette Shiner, deputy U.S. trade representative-designate, said May 19. Shiner, who spoke at the Hispanic Business Conference at the State Department, noted that the United States is pursuing trade liberalization in a number of different negotiating venues, including the World Trade Organization, the Free Trade Area of the Americas, and the U.S.-Central America Free Trade Agreement talks with Costa Rica, El Salvador, Nicaragua, Honduras, and Guatemala.

Also addressing the conference, Treasury Secretary John W. Snow said that the most important thing the United States could do for developing countries is to spur growth in its economy. He called for quick passage of the president's pending tax proposals since the sooner the president can sign the measure "the sooner America's families and entrepreneurs can begin to take advantage of the enhanced incentives for growth it provides."

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3. MEAA launches new campaign on USFTA

MEAA media release
1 June 2003

The Media Arts and Entertainment Alliance (MEAA) is launching a national campaign, called Free to Be Australian, to assist in raising awareness about the Australia-US Free Trade Agreement (FTA) and issues concerning local media, arts and entertainment industries.

Brian Pound at the MEAA further explained the aim of the campaign: "Essentially, it is to ensure that our culture and media in Australia are not placed at risk under the free trade negotiations. The negotiations have actually been bought forward... So it has become very urgent for us to ensure that arts and culture are not sold off for potential sales of lamb chops into the US market."

Judy Davis, Gary Sweet, Corinne Grant and MEAA Victorian Branch President Alan Fletcher spoke at the launch of the Free to Be Australian campaign in Melbourne on June 1. Industry practitioners and the general public are encouraged to support the new campaign. A dedicated Free To Be Australian portal will soon be available on the MEAA website and will include information on the latest FTA issues as they come to hand. More information and RSVP details for the Free To Be Australian launch can be found online at: www.free2baustralian.org.au/

In a related story:

US Words No Comfort For Aussie Film and Television Industry

The head of one of Australia's main film bodies says he is not comforted by recent pronouncements by the head of the Motion Picture Association of America, Jack Valenti, that the United States won't be striving to abolish local TV quotas or film subsidies. Valenti's remarks came last week in response to fears expressed by the Australian production sector that a proposed free trade deal with the United States would jeopardize the ongoing viability of the local screen industry.

But Kim Dalton, who is the CEO of the government-funded development agency the Australian Film Commission, believes that the protection of industry support mechanisms remains a hot issue despite the ostensibly soothing tone of Valenti's remarks. While some in the Australian industry have expressed concerns that the free trade agreement might sound the death knell for local content quotas and funding arrangements (Hollywood Reporter, 13 May 2003), Dalton argues that such anxieties are exaggerated. Yet he believes that critical issues remain on the table.

"It's unrealistic to say that the Australian government will abandon its regulatory framework, and the Americans know that," Dalton said in an interview at the Festival de Cannes last week. "But the Americans want two things: firstly, to get a standstill arrangement to the existing regulatory framework, which means no ramping up of funding mechanisms or content quotas. And secondly, they want to get an agreement that there will be no regulatory arrangements on new and emerging services such as broadband. This has always been the American position. For Valenti to make it sound like they're being sympathetic to local cultures or arriving at the table with a position of compromise is disingenuous."

Dalton's response to Valenti's remarks follows increasing conjecture in Australia about both the intentions of the American negotiating team and the tactics that might be adopted by the Australian government, which is keen to see greater opportunities for agricultural and industrial sector products. With the second round of talks between the two countries concluded in Hawaii on Friday, the stage is expected to be set for the unraveling of the official American position on film and television issues. "They want us to feel relaxed, but we're not feeling relaxed at all," Dalton concludes. "But to suggest that this story is now over is a complete misreading of the situation -- the story has barely begun."

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4. Reminder: GATS and USFTA training: Sydney, 1 July

Would you like more effective tools to explain the WTO GATS agreement, proposals for new WTO agreements and the USFTA to your community organisation or union? This train-the-trainers day will provide both the latest information and skills for effective advocacy.

• Update on the WTO General Agreement on Trade in Services (GATS) and impacts on essential services like health, education and water
• Latest on the proposals for new WTO agreements on investment, competition policy and government procurement and why these are opposed by both developing country governments and community organisations
• Latest developments on the US Free Trade Agreement Negotiations and possible impacts on Australian social policies
• Effective advocacy skills to present the issues to community groups, politicians and the media

• Union and community trainers
• Activists/campaigners
• Community workers

COURSE DETAILS:

The course is free, including light refreshments, but you MUST register in advance, as the course is limited to 25 participants. To register contact Sarah Mitchell at the Public Interest Advocacy Centre (smitchell@piac.asn.au or phone (02) 9299 7833).

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5. George Monbiot, author of Manifesto for a New World Order, speaks in Sydney on Tuesday 15 July at 6.30 pm, the Valhalla, Glebe

The existing global system is in trouble. Global institutions such as the WTO and World Bank are undemocratic and unaccountable. Increased prosperity for some goes hand in hand with increased poverty for others. The UN has been bypassed by the war with Iraq. Everywhere, people are asking what comes next. There has never been a better moment to call for a democratic revolution.

Fiercely controversial and yet utterly persuasive, what Monbiot offers is a truly global perspective. He outlines a sense of history, a defence of democracy, and an understanding of power and how it might be captured from those unfit to retain it. Our task is not to overthrow globalisation but to capture it and to use it as a vehicle for humanity's first global democratic revolution.

George Monbiot has held visiting fellowships or professorships at Green College, Oxford and the Universities of Bristol, Keele and East London, in (respectively) environmental policy, philosophy, politics and environmental science. He is currently visiting professor of planning at Oxford Brookes. His other books include Poisoned Arrows, Amazon Watershed, No Man's Land and Captive State. He is a columnist for The Guardian.

This event is co-sponsored by Oxfam Community Aid Abroad, Gleebooks & The Adelaide Festival of Ideas.

$8/$5 conc & gleeclub
RSVP Tel: 9660 2333 or email books@gleebooks.com.au

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