Free Trade Area of the Americas

Negotiations Progress, but Successful Ministerial Hinges on Intensified U.S. Preparations Gao ID: GAO-03-560 April 11, 2003

Establishing a 34-nation Free Trade Area of the Americas agreement has been under negotiation since 1998. This agreement would eliminate tariffs and create common trade and investment rules for these nations. Most recently, the United States, along with Brazil, assumed the leadership of the negotiations. GAO was asked to analyze (1) the challenges for the current negotiating phase, which will include a ministerial meeting in Miami, Florida, in November 2003; and (2) the U.S.'s readiness to serve as co-chair of the negotiations and host of the November 2003 ministerial.

USTR, which is responsible for co-chairing the Free Trade Area of the Americas negotiations and hosting the November 2003 ministerial meeting, faces challenges to its readiness to assume these responsibilities. During the current negotiating phase, achieving improved market access for the 34 nations is paramount. It may be difficult, however, for participants to make ambitious offers to lower tariffs and other trade barriers. Another challenge involves the resolution of issues such as subsidies for agriculture. The resolution of this issue has been linked to ongoing negotiations at the World Trade Organization, but these talks are bogged down. A further challenge is ensuring the momentum and the political will of the United States and Brazil to move the process forward to a timely completion by January 2005. As co-chair of the negotiations, USTR also faces risks to assuring its readiness as host of the November ministerial. First, USTR has little experience in hosting a major ministerial meeting, and its staff remains small and is stretched thin. Second, plans for the meeting are at an early stage, and much remains to be done. Third, USTR is counting on funding that has not yet been secured. And finally, USTR is likely to encounter protestors at the November ministerial. Factoring security for the invited participants into the logistical arrangements for the ministerial is a prime concern.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: Team: Phone:


The Justia Government Accountability Office site republishes public reports retrieved from the U.S. GAO These reports should not be considered official, and do not necessarily reflect the views of Justia.