WASHINGTON – With his proposed Central American Free Trade Agreement (search) facing trouble in Congress, President Bush is meeting next week with leaders from five Latin American countries and the Dominican Republic.
The White House said Monday that the president will meet on May 12 with President Abel Pacheco of Costa Rica, President Leonel Fernandez of the Dominican Republic, President Tony Saca of El Salvador, President Oscar Berger of Guatemala, President Ricardo Maduro of Honduras and President Enrique Balanos of Nicaragua.
Various tallies show the pact -- CAFTA -- is in trouble in Congress, especially in the House where Democratic opponents have been joined by Republican lawmakers from sugar- and textile-producing districts. A number of Democrats have expressed reservations about supporting CAFTA, saying the administration needs to show greater efforts to enforce current trade agreements before Congress will approve new ones, especially in the light of soaring trade deficits.
CAFTA has been linked to the issue of Chinese trade by administration officials who say the agreement would benefit the U.S. textile industry because Central American apparel makers rely on U.S. yarn and fabric. Chinese apparel makers, the winners if the agreement is defeated, use almost no American content.
Commerce Secretary Carlos Gutierrez (search) has said he thinks the administration will be able to win the CAFTA vote in Congress. He said American textile companies would be able to sell yarn and fabric more cheaply with tariffs eliminated with the CAFTA countries and those countries would have an edge over China in selling finished clothes back into the United States. As for worries among sugar producers about increased competition from the CAFTA nations, Gutierrez said there would be only a small increase in sugar imports under the pact.