Free Trade Area of the Americas
United States Faces Challenges as Co-Chair of Final Negotiating Phase and Host of November 2003 Ministerial Gao ID: GAO-03-700T May 13, 2003Since 1998, the 34 democratic nations of the Western Hemisphere have been negotiating a Free Trade Area of the Americas agreement to eliminate tariffs and create common trade and investment rules for these nations. The United States will co-chair, with Brazil, the final phase of the negotiations, due to conclude in January 2005. GAO was asked to (1) review challenges that the United States faces as co-chair of the final negotiating phase and (2) discuss risks that the United States may encounter, as host, in Miami, of the November 2003 ministerial meeting.
The United States faces several challenges as co-chair of the final phase of Free Trade Area of the Americas negotiations. First, the Office of the U.S. Trade Representative (USTR), which is responsible for co-chairing these negotiations and hosting the November 2003 ministerial, has not added appreciably to its staff, despite the sharply increased workload. Second, the goals of this phase--such as achieving improved market access for the 34 nations--are ambitious and will require serious, substantive trade-offs. Finally, the negotiations are proceeding on the same timeline as several other complex trade negotiations involving the United States. In fact, the resolution of a key issue, agricultural subsidies, has been linked to ongoing negotiations in the World Trade Organization. Currently, these negotiations are bogged down. Moreover, important risks are already apparent in current U.S. plans for hosting the November 2003 Miami ministerial meeting. Gaps exist in several key areas important to successfully hosting a major trade ministerial. For example, USTR has limited experience in planning and providing logistics for such a meeting. Furthermore, USTR is getting little support from other federal agencies. In addition, no federal agency has yet received any funding for the November event, which is projected to cost $10 million. Finally, USTR is likely to encounter protestors at the November ministerial. Failure to link security, funding, and logistics at a prior ministerial caused serious problems for the organizers of that event.
GAO-03-700T, Free Trade Area of the Americas: United States Faces Challenges as Co-Chair of Final Negotiating Phase and Host of November 2003 Ministerial
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Testimony:
Before the Subcommittee on International Trade, Committee on Finance,
U.S. Senate:
United States General Accounting Office:
GAO:
For Release on Delivery Expected at 2 p.m., EDT:
Tuesday, May 13, 2003:
Free Trade Area of the Americas:
United States Faces Challenges as Co-Chair of Final Negotiating Phase
and Host of November 2003 Ministerial:
Statement of Loren Yager, Director
International Affairs and Trade:
GAO-03-700T:
GAO Highlights:
Highlights of GAO-03-700T, a testimony before the Subcommittee on
International Trade, U.S. Senate Committee on Finance
Why GAO Did This Study:
Since 1998, the 34 democratic nations of the Western Hemisphere have
been negotiating a Free Trade Area of the Americas agreement to
eliminate tariffs and create common trade and investment rules for
these nations. The United States will co-chair, with Brazil, the final
phase of the negotiations, due to conclude in January 2005. GAO was
asked to (1) review challenges that the United States faces as co-
chair of the final negotiating phase and (2) discuss risks that the
United States may encounter, as host, in Miami, of the November 2003
ministerial meeting.
What GAO Found:
The United States faces several challenges as co-chair of the final
phase of Free Trade Area of the Americas negotiations. First, USTR,
which is responsible for co-chairing these negotiations and hosting
the November 2003 ministerial, has not added appreciably to its staff,
despite the sharply increased workload. Second, the goals of this
phase”such as achieving improved market access for the 34 nations”are
ambitious and will require serious, substantive trade-offs. Finally,
the negotiations are proceeding on the same timeline as several other
complex trade negotiations involving the United States. In fact, the
resolution of a key issue, agricultural subsidies, has been linked to
ongoing negotiations in the World Trade Organization. Currently, these
negotiations are bogged down.
Moreover, important risks are already apparent in current U.S. plans
for hosting the November 2003 Miami ministerial meeting. Gaps exist in
several key areas important to successfully hosting a major trade
ministerial. For example, USTR has limited experience in planning and
providing logistics for such a meeting. Furthermore, USTR is getting
little support from other federal agencies. In addition, no federal
agency has yet received any funding for the November event, which is
projected to cost $10 million. Finally, USTR is likely to encounter
protestors at the November ministerial. Failure to link security,
funding, and logistics at a prior ministerial caused serious problems
for the organizers of that event.
What GAO Recommends:
The Office of the U.S. Trade Representative (USTR) should intensify
U.S. preparations and regularly evaluate whether resources and plans
are sufficient to carry out the tasks and mitigate the risks
associated with its responsibilities as co-chair of the negotiations
and host of the November ministerial. These are related to USTR‘s (1)
increased workload, (2) planning for the ministerial, (3) funding
sources, and (4) security needs at the ministerial.
www.gao.gov/cgi-bin/getrpt?GAO-03-700T.
To view the full report, including the scope
and methodology, click on the link above.
For more information, contact Loren Yager at (202) 512-4347 or
YagerL@gao.gov.
Mr. Chairman and Members of the Subcommittee:
I am pleased to be here today to discuss the readiness of the United
States to successfully perform as co-chair (with Brazil) of the Free
Trade Area of the Americas negotiations process and host of the
November 2003 ministerial meeting. As you know, work on the Free Trade
Area of the Americas, or FTAA, agreement is one of the most significant
ongoing trade negotiations for the United States. In fact, the Bush
administration has made establishing the FTAA one of its top trade
priorities. Negotiations toward establishing this agreement among the
34 democratic nations of the Western Hemisphere have formally been
under way since 1998. Such an agreement would eliminate tariffs and
create common trade and investment rules for these nations. The final
phase of FTAA negotiations began last November and is scheduled to
conclude with the completion of the agreement in January 2005. Today, I
will first review the challenges that the United States faces, as co-
chair of this final phase of FTAA negotiations. Second, I will discuss
the risks that the United States may encounter as host of the November
ministerial in Miami.
My testimony is based on our recently published report on this
subject.[Footnote 1] It is also based on our past and ongoing work on
the FTAA negotiations process.[Footnote 2]
Summary:
The United States faces several challenges as co-chair of the final
phase of the FTAA negotiations. First, the Office of the U.S. Trade
Representative (USTR), which handles the negotiations, has not added
appreciably to its staff, despite the sharply increased workload and
responsibilities associated with co-chairing the FTAA negotiations.
Second, the goals of this negotiating phase are ambitious and may be
difficult to achieve. For example, FTAA negotiations on market access
commitments--considered the "heart" of an agreement--will require
serious trade-offs among the participating nations. In addition,
finalizing the FTAA agreement will require the 34 participating nations
to bridge wide, substantive differences on topics such as investment
and intellectual property. Finally, FTAA negotiations are taking place
at the same time as several other complex trade negotiations that often
involve the same issues and staff. Indeed, the resolution of key issues
for the hemisphere, such as agricultural subsidies, has been linked to
negotiations in the World Trade Organization (WTO) that are presently
bogged down.
Although current U.S. plans for hosting the FTAA Trade Ministerial in
Miami in November 20 and 21, 2003, are at an early stage, important
risks are already apparent. Officials with prior experience in hosting
ministerial meetings told us that certain key elements must be in place
soon to successfully host a major trade ministerial, notably
experienced staff, a clear plan, sufficient funding, and adequate
security. However, our examination of agency records and other
documents reveals that current U.S. plans leave gaps in several of
these areas. For example, USTR has sole responsibility for all facets
of planning and logistics, a complex task. However, USTR has limited
institutional experience in this area and is getting little support
from other federal agencies, such as the Department of State. In
addition, although current estimates are that the FTAA ministerial will
cost $10 million, no federal agency has yet received any funding for
this event, and the local organizers are just beginning fund-raising
efforts. Failure to mitigate similar risks caused serious logistical
and security problems at the last major trade ministerial hosted by the
United States, the 1999 Seattle WTO ministerial. [Footnote 3]
In our report, we recommend that USTR intensify preparations and
regularly evaluate whether its resources and plans are sufficient to
successfully carry out the tasks and mitigate the risks associated with
co-chairing the FTAA negotiations and hosting the November 2003
ministerial meeting.
In commenting on our report, USTR and the Department of State agreed
with our overall message. However, USTR stressed that it believes plans
for hosting the ministerial are currently at an appropriate stage of
development.
Background:
The United States has long been a key player in the FTAA negotiations.
Now, in addition to participating as a major negotiating country
charged with advancing its own position with the FTAA negotiations, the
United States has assumed responsibility in two other areas. First,
this past November, the United States became co-chairman (with Brazil)
of the negotiations. In this capacity, the United States has assumed
responsibility for leading the FTAA process as a whole forward to its
conclusion. Second, in conjunction with this role, the United States
will serve as host of a hemispheric trade ministerial in November of
this year. As such, it is responsible for providing facilities and
making logistical and security arrangements for that meeting.
Co-chairmanship Poses Challenges for United States:
The United States faces three key challenges as it takes on the
responsibility, together with Brazil, of co-chair of the negotiations
charged with guiding the FTAA process forward to a successful
conclusion by January 2005: (1) handling a substantial increase in its
workload, (2) managing the intensified negotiating pace and
substantively difficult trade-offs associated with concluding an FTAA
agreement, and (3) simultaneously juggling the FTAA and several other
complex trade negotiations.
Workload and Negotiating Pace to Increase, but Resources Not
Commensurate:
Workload to Increase:
The first key challenge for the USTR as co-chair of the FTAA process
will be handling the increased workload as negotiations intensify,
without an appreciable increase in staff. The co-chair's
responsibilities are considerable. They include providing leadership to
the negotiating process and regular guidance to the 10 negotiating
groups and special committees charged with developing the FTAA rules,
specific market access commitments, and institutional arrangements that
will together comprise an FTAA agreement. The United States must also
coordinate with Brazil, the other co-chair, on a daily basis.
Despite general recognition that co-chairing will involve more work for
the United States than chairing on its own, USTR only has about half as
many staff devoted to co-chairing the FTAA negotiations as previous
chairs have had. Presently, USTR has two staff working full-time on the
day-to-day FTAA co-chairmanship tasks. Two other staff devote some of
their time to the co-chair function and some to advancing U.S.
positions in the FTAA negotiations. Brazil currently has five staff
handling the co-chair function and plans to add a sixth. Ecuador, which
chaired the negotiations from April 2001 to October 2002, had eight
people working on substantive issues and additional people working on
logistics. Canada, which chaired the negotiations from March 1998 to
November 1999, had eight people, with access to others for special
projects. To mitigate this situation, USTR is seeking to bolster its
resources quickly by borrowing staff from other agencies. Although it
has recently had limited success,[Footnote 4] funding caps and other
concerns may make agencies reluctant to detail more people to USTR
without receiving reimbursement.
Several past FTAA chairs have told us that the consequence of a U.S.
failure to adequately staff the co-chairmanship could be a slowdown of
FTAA negotiations. These negotiations have reached a critical juncture
with the launch of market access talks on February 15, 2003. Any
slowdown could make it even more difficult to achieve substantial
results by the November 2003 Miami ministerial.
FTAA Negotiations Intensifying, as Are Substantive Demands:
A second key challenge facing USTR is the intensifying pace of the FTAA
negotiations. To conclude a final agreement by January 2005, much
remains to be done. In fact, various FTAA negotiating group meetings
have been scheduled for practically every day for the coming 6 months.
As our report explains, although considerable technical groundwork has
been laid since FTAA negotiations were formally launched in 1998, up to
now, FTAA negotiations did not involve serious, substantive trade-offs.
This lack of substantive movement is a concern to some observers, given
that only 20 months remain until the January 2005 deadline for
concluding an FTAA agreement. The overall timetable for FTAA
negotiations and key milestones for the current phase are depicted in
figure 1.
Figure 1: FTAA Time Frames and Milestones, 2002-2005:
[See PDF for image]
Note: The TNC refers to the Trade Negotiations Committee. The TNC
guides the work of the negotiating groups and other committees and
groups and decides on the overall architecture of the agreement and
institutional issues.
[End of figure]
Five of the nine FTAA negotiating groups--agriculture, market access,
services, government procurement, and investment--finally began work
negotiating concrete market access commitments, or schedules to
liberalize trade, in mid-February 2003. These negotiations are
considered very important, because they will determine how much trade
and investment will actually be liberalized and how rapidly trade
barriers will be removed. Even though all 34 FTAA countries met the
deadline for submitting initial offers on industrial and agricultural
market access, many of these offers were conservative. For example, in
contrast to the U.S. offer, several nations placed sizeable shares of
their trade into the longest phaseout category (more than 10 years) or
excluded some key items from liberalization. In addition, some nations
have not yet made offers on investment, services, and government
procurement. Ultimately, achieving substantial liberalization will be
difficult, because the tariffs of many FTAA participants are high, and
tariffs are an important source of government revenue for many FTAA
nations.
FTAA participants must also agree on the final legal text or rules on
such complex topics as intellectual property rights and competition
policy. To give you an idea of the magnitude of this task, the draft
FTAA agreement made public last November was nearly 400 pages long.
Moreover, most of the text was in brackets, which signified
disagreement among the 34 participating nations. Bridging these
disagreements may be difficult, given the number and diversity of
nations participating. Several FTAA participants, including the United
States, are among the wealthiest nations in the world. But some FTAA
participants, such as Haiti, are among the poorest, and others are
small or isolated in geographic terms.
To deal with the problem of differences in the 34 participants' wealth
and size, the November 2002 Quito ministerial launched a Hemispheric
Cooperation Program. This program is considered vital to building a
necessary consensus among the FTAA participants. The program's goal is
to identify critical priorities and help marshal funds that would
bolster the capacity of the lesser-developed nations to negotiate,
implement, and benefit from an FTAA. Participants' interests within the
FTAA negotiations differ, even among the largest countries. According
to reports, although the U.S.'s work with Brazil is going smoothly,
Brazil's commitment to the FTAA and to its deadlines remains unclear.
Recently, for example, Brazil's Foreign Minister stated that the FTAA
completion deadline of 2005 is too ambitious.
Indeed, FTAA negotiators have set ambitious goals for the coming
months. By June 15, 2003, the five groups negotiating market access
will exchange requests for revised offers. All ten negotiating groups
are working to provide vice ministers with a revised text at their next
meeting on July 7, 2003 (in El Salvador). The goal is to have a rather
advanced agreement by this November's FTAA ministerial in Miami.
Other Trade Negotiations Occurring Concurrently:
A third challenge facing the United States as co-chair is that other
major negotiations are occurring concurrently with the FTAA. For
example, the U.S. Trade Representative has notified Congress of his
intent to pursue free trade agreements with (1) five nations of Central
America, (2) Australia, (3) the South African Customs Union,[Footnote
5] and (4) Morocco, and USTR has started negotiations toward this end.
Meanwhile, the Doha Development round of WTO negotiations involving 146
nations and a similarly broad set of issues will officially be at the
midpoint at the September 2003 WTO ministerial. Some of the same USTR
staff are involved in these concurrent negotiations. Moreover, several
issues of importance to U.S. trade partners in the hemisphere, notably
agriculture subsidies and trade injury remedies, are linked to ongoing
negotiations at the WTO. The U.S. position is that the WTO is the
appropriate forum to deal with domestic agriculture subsidies, but many
other FTAA participants maintain that domestic agriculture support
needs to be addressed in both the FTAA and the WTO. The November 2002
Quito ministerial declaration notes the importance of progress in both
the WTO and FTAA agriculture negotiations. [Footnote 6] However, WTO
negotiators missed a March 31, 2003, deadline to establish modalities,
or the rules and guidelines for agricultural liberalization, as well as
other deadlines in other areas under negotiation. We noted in a
September 2002 report that meeting this deadline was a crucial
indicator of the likelihood of success in the overall
negotiations.[Footnote 7] Lack of progress in these WTO negotiations
has caused concern about prospects for progress in FTAA negotiations.
Gaps in U.S. Preparations for Hosting November 2003 Ministerial Pose
Risks:
The United States will host the Eighth FTAA Trade Ministerial in Miami
in November 2003, just 6 months from now. This ministerial is
particularly significant, because it will occur just over a year before
the slated conclusion of FTAA and WTO negotiations. As host, the United
States has numerous responsibilities, but U.S. planning for the
ministerial is at an early stage. Given the lead times involved,
however, intense efforts are needed to fill the remaining gaps in the
areas of expertise, planning, funding, and security.
Responsibilities of the Host of an FTAA Ministerial Are Numerous,
Important:
The host of an FTAA ministerial is generally responsible for providing
facilities, transportation, and security for both the ministerial and
the Trade Negotiations Committee meeting, a gathering of vice ministers
that precedes the ministerial. In addition, separate forums for the
business community and civil society typically accompany FTAA
ministerials. Each of these events involves hundreds of people,
including many high-level officials requiring appropriate protocol and
special security measures. The task of the United States as host is
especially complex, because USTR must coordinate actively with local
officials and oversee host city preparations to ensure they are
satisfactory. Successfully executing the many responsibilities of an
FTAA ministerial host is critical, given the importance of ministerial
meetings in the negotiations.
Several Factors Critical to Success:
Our discussions with cognizant officials suggest that hosts must have
several basic elements in place to fulfill the responsibilities
outlined above (see fig. 2). Particularly important is having (1) staff
experienced in bringing together all the different components including
logistics, budgeting, and procurement; (2) a plan that clearly sets
forth responsibilities and timelines for putting in place necessary
logistical arrangements; (3) access to funds to pay for expenses; and
(4) assurance of adequate security.
Figure 2: Keys to a Successful Ministerial:
[See PDF for image]
[End of figure]
USTR Lacks Experience Hosting; Miami Has Track Record but Wants
Support:
USTR has sole responsibility for organizing the FTAA ministerial. As an
agency, it has relatively little institutional experience in this area,
however, and it is receiving limited assistance from other agencies
with expertise. Until late April USTR had four permanent staff working
part-time on planning the FTAA ministerial, only one of these staff has
significant experience in logistics, security, and administration. USTR
had received substantial help in planning the last major trade
ministerial it hosted, the 1999 Seattle WTO ministerial, including
assistance from several Department of State officials with previous
international conference planning experience.[Footnote 8] The
Department of State is not providing similar support for the November
2003 FTAA ministerial, however, largely due to budgetary constraints.
In fiscal year 1995, the Department of State was receiving $6 million
to fund and support U.S. participation in international conferences. By
fiscal year 1999, this appropriation had been discontinued, with no
commensurate increase to USTR's budget for trade meetings.[Footnote 9]
As a result, USTR plans to rely heavily on Miami's expertise to carry
out the November 2003 meeting. Miami hosted the 1994 Summit of the
Americas that launched the FTAA initiative, and the city has hosted
other major events. However, the Miami organizers (committees and
individuals representing both private and public sectors in South
Florida, including the jurisdictions of the city of Miami, the county
of Miami-Dade, the city of Coral Gables, and the city of Miami Beach),
informed us that they would like more support from the federal
government. In particular, on the premise that the workload and need
for coordination will increase as the ministerial draws closer, they
would like a full-time federal staff person to be detailed from the
Department of State to Miami in a liaison capacity as soon as possible.
(This had been done for the 1994 Summit of the Americas, also in
Miami.):
Plans for Ministerial in Early Stages; Intense Preparations Required:
Both the federal government's and Miami's plans for hosting the
November 2003 ministerial are in early stages. Some of the specific
tasks identified in FTAA guidelines have been accomplished, and more
are in process. For example, accommodations for delegates and meeting
space have been selected. However, the USTR and Miami both agree that
much remains to be done between now and the November 2003 ministerial.
Among other things, a budget that clearly outlines funding sources and
responsible parties must be finalized; meeting space configured; a
security plan developed; and arrangements for providing credentials,
translation, administrative support, and other services made. The FTAA
Administrative Secretariat requires the United States to provide both
the Secretariat and the delegates with details of the U.S. arrangements
for the November FTAA ministerial by late September 2003. Making all of
the required arrangements by then will require intense preparations on
the part of both the USTR and Miami officials.
Funding Has Not Been Secured, and Funding Responsibilities Are Still
Unclear:
Among other things, funding for the FTAA ministerial has not been
secured. As of early May, a budget for the event had not been
finalized, local fund-raising had just begun, and no federal agencies
had received funding for the FTAA ministerial meeting. Current
estimates are that the ministerial will cost $10 million. Although some
funding requirements can be met through in-kind contributions, expenses
that require an outlay of funds are expected to total about $3 million
and will be incurred within the next 2 months. Such expenses include
making deposits for hotels and transportation and paying the firms
supporting the FTAA Web site and preparing delegate credentials.
Relying on the host city to pay the majority of the costs is a model
the United States has followed at past summits and trade ministerials
where a host committee, or an organizing group composed of local
representatives associated with the host city, paid for the majority of
the costs. For example, this model was used for a ministerial meeting
of the International Telecommunications Union held in 1998 in
Minneapolis, Minnesota. Some experiences with host committees have been
unsuccessful, however. For example, at the 1999 Seattle WTO
ministerial, decisions to rely on the host committee, and the
committee's ultimate failure to raise sufficient funds, caused problems
at the meeting. In addition, costs kept escalating as year-long
planning efforts continued, ultimately reaching $24 million.[Footnote
10] This amount is considerably higher than the December 1998 budget of
$9 million. Moreover, it is nearly as large as USTR's entire fiscal
year 2001 budget, which was $29 million.
No federal agency has yet received funding for the FTAA ministerial.
The USTR has only requested $200,000 for the FTAA ministerial, or 2
percent of the currently projected cost, but this is in the President's
fiscal year 2004 budget request for the year that begins October 1,
2003. At a minimum, USTR will have to pay for the expenses of its staff
participating in the event, for setting up and staffing a fully
equipped office in which U.S. delegates can work, for basic translation
services, and for certain aspects of security. To reduce costs, USTR
had planned to use computers and other equipment procured for the
September 2003 Cancun WTO ministerial for the Miami FTAA ministerial.
To date, however, USTR has not been given approval by the Office of
Management and Budget to submit a request for a $1.3 million
supplemental appropriation that would fund this procurement.
USTR has stated that Miami will provide the vast majority of funds for
the ministerial. USTR plans to rely on Miami's desire to be the site of
the permanent FTAA Administrative Secretariat as incentive to raise the
necessary funds. However, the Miami organizers believe the federal
government will also assume some financial responsibility because, in
their view, the ultimate host of the ministerial is the federal
government. Both parties have agreed to use the budget development
process to identify funding sources and apportion financial and
logistical responsibilities. However, this breakdown is still being
discussed.
USTR has sought to forestall any possible funding difficulties through
signing an agreement with the Miami organizers for them to provide a
statement of fund-raising principles and periodic status reports. So
far, the four Miami municipalities involved have drafted a memorandum
of understanding regarding their financial support of the meeting.
Under the memorandum, they agreed to provide in-kind and cash support
according to a yet-to-be specified formula.[Footnote 11] This agreement
allows signatories to withdraw, however, if they determine that they
can no longer financially participate.
Security Is Critical:
Another key risk the United States will face in Miami is ensuring the
security of participants. Previous trade ministerials have involved
extensive security requirements, in part because these events have
attracted protestors opposing globalization. USTR expects around 6,000
participants at the Miami ministerial. The number of protesters
expected, however, ranges between 20,000 and 100,000, according to both
USTR and the Miami organizers, compared to 9,000 participants and
50,000 protesters at the Seattle WTO ministerial. In a February 2000
report,[Footnote 12] we noted that protestors interfered with the
Seattle WTO ministerial by causing delays and disrupting proceedings.
Protestors also threatened and, in some cases, assaulted delegates.
Local reports indicated that 92 protestors and bystanders and 56 police
officers were injured, and that downtown Seattle businesses suffered $3
million in property damage. At the FTAA ministerial in Quito, Ecuador,
protestors were also present, and a breakdown in order at a meeting
between trade ministers and civil society groups raised security
concerns.
According to USTR officials, the need to link logistics and security is
an important lesson learned after the security problems experienced at
the Seattle ministerial and is a critical component of the planning for
the Miami event. At the Seattle ministerial, security costs accounted
for more than half of the expenses incurred, in part because security
had not been factored into logistical arrangements from the beginning.
USTR's goal is to have a security plan finalized by May 30, 2003.
Conclusions:
In summary, Mr. Chairman, despite 4 years of talks, considerable work
remains in order to culminate an initiative that the hemisphere's 34
democratically elected leaders once embraced as key to integrating
their economies, improving growth and equity, and strengthening
democracy. With a January 2005 deadline for completion, our work
suggests that the United States faces challenges as co-chair of the
final phase of FTAA negotiations and as host of a major trade
ministerial in Miami just over 6 months from now. Filling gaps in human
and financial resources is critical to success and will require intense
preparations on the part of both USTR and the Miami organizers between
now and November. As a result, in our report, we recommend that USTR
intensify U.S. preparations and regularly evaluate whether resources
and plans are sufficient.
Mr. Chairman and Members of the Subcommittee, this concludes my
prepared statement. I will be pleased to answer any questions you may
have.
Contacts and Staff Acknowledgments:
For future information on this testimony, please call Loren Yager or
Kim Frankena at (202) 512-8124. Individuals making key contributions to
this testimony included Venecia Rojas Kenah, R. Gifford Howland, Rona
Mendelsohn, Kirstin Nelson, Jon Rose, and Marc Molino.
FOOTNOTES
[1] See U.S. General Accounting Office, Negotiations Progress, but
Successful Ministerial Hinges on Intensified U.S. Preparations,
GAO-03-560 (Washington, D.C.: Apr. 11, 2003).
[2] See U.S. General Accounting Office, Free Trade Area of the
Americas: Negotiators Move Toward Agreement That Will Have Benefits,
Costs to U.S. Economy, GAO-01-1027 (Washington, D.C.: Sept. 7, 2001);
U.S. General Accounting Office, Free Trade Area of the Americas: April
2001 Meetings Set Stage for Hard Bargaining to Begin, GAO-01-706T
(Washington, D.C.: May 8, 2001); and U.S. General Accounting Office,
Free Trade Area of the Americas: Negotiations at Key Juncture on Eve of
April Meetings, GAO-01-552 (Washington, D.C.: Mar. 30, 2001).
[3] See U.S. General Accounting Office, World Trade Organization:
Seattle Ministerial: Outcomes and Lessons Learned, GAO/T-NSIAD-00-86
(Washington, D.C.: Feb 10, 2000).
[4] In mid-March, USTR announced that a senior Department of State
official will be loaned to the agency effective June 23, 2003, to head
the U.S. delegation to the FTAA's vice ministerial level Trade
Negotiations Committee. The official has been ambassador to the
Republic of Azerbaijan since October 2000. Prior to being nominated to
serve in Azerbaijan, he was principal deputy to the ambassador-at-large
and special advisor to the Secretary of State for the New and
Independent States of the former Soviet Union (1997-2000), where he had
direct responsibility for U.S. relations with Ukraine, Central Asia,
and the Caucasus. (This addition basically means that the senior USTR
person presently responsible for this role will no longer have to split
her time among the Chile Free Trade Area (FTA), Central American FTA,
and FTAA negotiations, as well as the North American Free Trade Area
(NAFTA) and other duties.) Another Department of State detailee is
expected this summer.
[5] A customs union including South Africa, Lesotho, Botswana, Namibia,
and Swaziland.
[6] Specifically, the Quito ministerial declaration states:
We recognize that, in a global market, we must have significant results
in the negotiations on agriculture, both in the FTAA and in the WTO. In
this context, we must also take into account the practices by third
countries that distort world trade in agricultural products. We also
recognize that our respective evaluation by country or group of
countries, of the results in the market access negotiations in
agriculture in the FTAA, will depend on the progress we can reach in
other subjects that are part of the agriculture agenda.
[7] See U.S. General Accounting Office, World Trade Organization: Early
Decisions are Vital to Progress in Ongoing Negotiations, GAO-02-879
(Washington, D.C.: Sept. 4, 2002).
[8] Although some records are available, including timelines and task
lists, the Department of State does not have written guidelines on how
to plan such an event, and no formal, written "lessons learned" were
prepared after the Seattle WTO ministerial.
[9] In fiscal year 2000, the Department of State received a separate
appropriations for the Seattle ministerial.
[10] Security expenses accounted for more than half of the total cost,
amounting to $14 million.
[11] The four municipalities involved are the city of Miami, the county
of Miami-Dade, the city of Coral Gables, and the city of Miami Beach.
[12] See GAO/T-NSIAD-00-86.
