Bush Steadfast on Free-Trade

MAR DEL PLATA, Argentina – It appeared Saturday that President Bush's (search) best hope for getting a Western Hemisphere trade pact would leave a gaping hole in what he once envisioned as a free-trade zone stretching from Alaska to Argentina.

On the final day of the Summit of the Americas (search), Bush was hoping to keep his trade proposal alive despite opposition from five key countries that has persisted through years of negotiations.

The meetings were being held within a security zone, protected by barricades and security guards, because of violent protests aimed at Bush's trade and Iraq policies.

Mexican President Vicente Fox (search) said 29 of the 34 nations gathered in this seaside resort for the summit are considering putting together their own free-trade pact — without opponents Brazil, Venezuela, Argentina, Paraguay and Uruguay.

A senior Bush administration official, speaking on condition of anonymity because negotiations were still continuing, said the U.S. is confident it will emerge at the end of the day with a majority of summit participants agreeing to move forward.

But any talk of progress must be weighed with the fact that Brazil isn't willing to take a key step — setting a firm date to restart high-level negotiations. Brazil is the largest country in Latin America and was the United States' co-chair in the trade agreement negotiations that were supposed to end in a final agreement Jan. 31.

Instead, those talks have stalled. Brazil wants the United States to reduce farm subsidies that it said would crowd out Brazilian products. The United States wants Brazil to do more to crack down on widespread pirating of U.S. movies and music.

Outside the meeting site Friday, more than 1,000 demonstrators opposing Bush and the trade deal clashed with police, shattered storefronts and set businesses ablaze. Protesters shouted "Get out Bush!" and "Fascist Bush! You are the terrorist!"

The United States has said it is ready to make steep cuts to farm tariffs as Brazil has demanded, provided European countries follow suit so that the U.S. is not at a disadvantage in trans-Atlantic trade.

So far, the European Union has not agreed to cuts that are as low as the United States has proposed.

U.S. officials have said they hope that once they resolve issues with the European Union, holdouts from the Western Hemisphere trade negotiations will come back to the table.

"The degree to which there is division in the Americas, the degree to which there are people who want to opt out of that common consensus, it lessens the chances of successfully achieving the kind of agenda that we have identified," said Thomas Shannon, assistant secretary of state for Western Hemisphere affairs.

Bush has said the proposed Free Trade Area of the Americas, or FTAA, would generate wealth, create jobs and help lift tens of millions of Latin Americans out of poverty.

Bush did not mention the pact on the summit's opening day Friday, leaving the heavy lifting on negotiations to Mexico's Fox.

"Anyone who blocks an accord like this is certainly looking out for their own interests and not the interests of others," Fox said. "This majority of countries are advancing toward a good, just and beneficial FTAA."

Venezuelan President Hugo Chavez has been the most vocal critic of the trade pact and boldly declared that he will see that it's killed. "Here, in Mar del Plata, FTAA will be buried!" Chavez told more than 10,000 protesters gathered just before the summit.

But analysts said the four other countries that are out for now — all members of their own trade bloc known as Mercosur — would probably end up joining any Americas pact later.

"Over time, there would be pressure for the Mercosur countries to join," said Michael Shifter, a Latin America expert at the Inter-American Dialogue research group in Washington. "And the U.S. and other participating governments would extend an open invitation."

Bush's next stop after the summit ends Saturday is Brazil for talks Sunday with President Luiz Inacio Lula da Silva.

"Brazil is a very important player," Bush told a Brazilian reporter who earlier this week asked about the leaders' differences over trade. "When Brazil speaks, people listen carefully."