First Summit of the Americas:
FREE TRADE AREA OF THE AMERICAS (FTAA)
The Organization of American States is dedicated
to the solution of economic problems, interested in devoting the
largest amount of its resources to the economic development of its
member states whenever possible, and serious about strengthening
economic relations in the hemisphere. When the Leaders from the
U.S., Latin America, Canada, and the Caribbean met in Miami, 1994,
they knew this. They aimed at creating a hemispheric common market
committed to liberalized and free trade.
Hemispheric economic integration was the most
talked about topic at the First Summit of the Americas in Miami,
and, indeed, it was here that Governments set the groundwork for the
Free Trade Area of the Americas. In proposing the FTAA Agreement,
the Summit's Plan of Action gave its blessing to the GATT/WTO
process and committed itself to knocking down barriers to trade and
investment. In Miami, member states resolved to commit themselves to
trade liberalization, transparency, market access, and economic
integration. Nonetheless, in their efforts to foster economic
progress, enhance domestic prosperity, and raise living standards,
they never sacrificed their commitments to improved working
conditions and environmental protection.
Namely, the Miami Summit's discussions of FTAA
focused on the following topics:
- Eliminating tariffs and non-tariff barriers affecting the
trade of goods and services;
- Working with private sector and international financial
systems to create a hemispheric infrastructure;
- Cooperatively improving telecommunications and transportation,
which will permit efficient movement of goods, services,
capital, information and technology;
- Eradicating poverty and discrimination in the hemisphere;
- Guaranteeing sustainable development, which is essential to
economic prosperity and progress; and a host of other things
including:
- Agriculture
- Subsidies
- Intellectual Property Rights
- Government Procurement
- Antidumping and Countervailing Duties
- Sanitary and Phytosanitary Standards and Procedures
- Dispute Settlements
- Competition Policy
The nine cornerstones of the FTAA process,
declared in 'Initiative Nine' of the Miami Summit's Plan of Action,
are:
- A strong commitment to multilateral rules and disciplines,
which are consistent with GATT/WTO and other sub-regional trade
agreements;
- Pursuing trade liberalization and sub-regional integration,
while making mutually supportive economic and environmental
policies, taking other international organizations in account,
avoiding disguised trade restrictions, and ensuring sustainable
development and worker rights;
- Maximizing openness by building upon existing hemispheric
agreements;
- Recognition of the sovereign right of each nation to implement
international commitments in harmony and accordance with its own
legislation and procurements;
- Technical assistance to the smaller nations to facilitate
integration into the agreement;
- Holding meetings under existing trade and investment fora in
order to determine areas of commonality and divergence and to
insure an environment of openness for minister's recommendations
to the FTAA process;
- Transparent and understandable subregional and bilateral
agreements that will advance trade and investment in the
Americas, with assistance from the Tripartite Committee;
- Ongoing participation, review and guidance of the ministers
responsible for trade;
- OAS assistance in initiating the process and arranging
ministerial meetings.
The FTAA is, of course, a central component of
the Summit process. When realized, the FTAA will be the largest free
trade agreement in history, with an expected combined GDP of over $9
trillion, and a market of some 765 million people.
Chronology of FTAA Process
|
Ministerials, Vice Ministerials and Business Fora
|
9-11 December 1994 |
First
Summit of the Americas
|
Miami, USA |
30 June 1995 |
First
Western Hemisphere Trade Ministerial |
Denver, USA |
1-2 July 1996 |
First Business Forum of the Americas |
Denver, USA |
18-20 March 1996 |
Second Business Forum of the Americas |
Cartagena, Colombia |
21 March 1996 |
Second
Western Hemisphere Trade Ministerial |
Cartagena, Colombia |
16-17 September 1996 |
Western Hemisphere Vice Ministerial |
Florianopolis, Brazil |
25-27 February 1997 |
Western Hemisphere Vice Ministerial |
Recife, Brazil |
April 1997 |
Western Hemisphere Vice Ministerial |
Rio de Janeiro, Brazil |
13-15 May 1997 |
Third Business Forum of the Americas |
Belo Horizonte, Brazil |
16 May 1997 |
Third
Western Hemisphere Trade Ministerial |
Belo Horizonte, Brazil |
29-31 July 1997 |
Western Hemisphere Vice Ministerial |
San Jose, Costa Rica |
28-30 October 1997 |
Western Hemisphere Vice Ministerial |
Costa Rica |
10-12 February 1998 |
Western Hemisphere Vice Ministerial |
Costa Rica |
16-18 March 1998 |
Fourth Americas Business Forum |
San Jose, Costa Rica |
19 March 1998 |
Fourth
Western Hemisphere Trade Ministerial |
San Jose, Costa Rica |
19 April 1998 |
Second
Summit of the Americas |
Santiago, Chile |
3-4 November 1999 |
Fifth
Trade Ministerial Meeting |
Toronto, Canada |
Action Taken on the FTAA between the Summits
(January 1995 - March 1998):
Upon the completion of the Miami Summit, the
Hemisphere's Trade Ministers took steps to ensure concrete progress.
Adhering strictly to the schedule mandated by Heads of State and
Government at Miami, Ministers held four major meetings to advance
the FTAA agenda. They took place in:
- Denver (June, 1995)
- Cartagena (March, 1996)
- Belo Horizonte (May, 1997)
- San Jose (March, 1998)
1995 Denver Trade Ministerial:
Held in June, the first Trade Ministerial meeting
established several fundamental principles for an FTAA (Words
into Deeds, p. 67):
- That it be consistent with the provisions of the World Trade
Organization;
- That is be balanced and comprehensive, covering all areas in
the Miami Summit document; and
- That all countries would adhere to all of the FTAA
obligations.
Trade Ministers found that access to detailed
information on each other's trade regimes and hemispheric working
groups would allow them to make progress toward concluding FTAA
negotiations by 2005. To do so, they created seven working groups to
be chaired by separate countries. They are:
- Market Access (chaired by El Salvador)
- Customs Procedures and Rules of Origin (Bolivia)
- Investment (Costa Rica)
- Subsidies, Anti-dumping, and Countervailing Duties (Argentina)
- Standards and Technical Barriers to Trade (Canada)
- Sanitary and Phytosanitary Measures (Mexico)
- Smaller Economies (Jamaica)
At the meeting, ministers asked each working
group to identify and examine trade-related measures in its
respective area with a view to identifying the possible approaches
to negotiations in that area. In order to do so, groups shared
information on tariffs, private sectors goals and objectives, market
access, customs, investment, anti-dumping, smaller economies and
other topics. Country participation was strong and significant
progress was made.
1996 Cartagena Trade Ministerial:
Smashed between the Second Americas Business
Forum and the Vice Ministers meetings on working group guidance was
the second Trade Ministerial meeting. Convened in Cartagena in March
1996, its main accomplishments was the Ministers' creation of five
additional working groups (Word into Deeds, p. 68):
- Services (chaired by Chile)
- Competition Policy (Peru)
- Intellectual Property Rights (Honduras)
- Government Procurement (United States)
- Dispute Settlement
The groups examined and identified trade-related
measures and made new recommendations on approaches to FTAA
negotiations. Ministers also assigned the Vice Ministers of Trade
greater leadership and considered establishing study groups on the
protection of the environment and workers' rights.
1997 Belo Horizonte Trade Ministerial:
The third Trade Ministerial meeting set out a
well-defined work program for the twelve Working Groups and
established a Preparatory Committee of Vice Ministers. The VPs were
charged with recommending that Heads of State and Government
initiate FTAA negotiations at the Summit of Americas meeting in
April 1998 in Santiago, Chile. The Preparatory Committee was
directed to make recommendations on the negotiations for decision by
Ministers at the March 1998 San Jose meeting too. The
recommendations of working groups and the input of civil society,
including labor and other groups, were to be included in their
deliberations.
A Business Forum again preceded the Ministerial
meeting and provided an opportunity for the private sector to make
its views known to Trade Ministers. The Tripartite Committee was
asked to prepare a feasibility study on the creation of a temporary
administrative secretariat to support the FTAA negotiations.
Significant progress has been made in defining objectives and
principles to guide the negotiating phase of the FTAA. They are
evident in documents laid out in the fourth meeting at San José (Words
into Deeds, p. 68).
1998 San José Trade Ministerial:
The fourth Trade Ministerial in Costa Rica
concluded the three-year long preparatory phase of the FTAA. At the
meeting, the Ministers Responsible for Trade recognized the 34
countries' hard work, progress achieved in trade liberalization, and
implementation of the obligations assumed by their Governments. In
addition, they approved and forwarded to the Hemisphere's Leaders
recommendations on a framework defining objectives, principles,
structure and organization for FTAA negotiations. After reiterating
their recognition of the Miami Declaration of Principles and Plan of
Actions' broad social and economic agenda, taking into account the
differences in the levels of development and size of economies, and
reviewing the Committee of Vice-Ministers' proceedings, they set out
a bold 'Initiation of the Negotiations' and 'Structure and
Organization of the Negotiations' agenda (Words into Deeds,
p. 69 and Official Documents, p. 342 and 343).
Initiation of the Negotiations (1998 San José):
In the 'Initiation', they simply recommended that
the Heads of State and Governments initiate negotiation of the FTAA
during the II Summit of the Americas, and reaffirmed the principles
and objectives that guided their work since Miami (Official
Documents, p 342).
Structure and Organization of the Negotiations
(1998 San José):
In San José, the Ministers also laid out a
flexible structure for the negotiations, which they expected to
modify over time as required to assist the FTAA. Meetings were set
to be scheduled at least every 18 months, and the particulars of the
Trade Negotiations Committee (TNC) at the Vice ministerial level
were determined. The TNC is to take the overall responsibility of
ensuring the full participation of all the countries in the FTAA
process. Meeting at least twice a year, it is also to take into
account the concerns of the smaller economies and concerns related
to countries with different levels of development.
Directly borrowing from previous Ministerial
meetings, the Ministers established nine negotiating groups on:
market access; investment; services; government procurement; dispute
settlement; agriculture; intellectual property rights; subsidies;
antidumping and countervailing duties; and competition policy.
Chairmen and Vice-Chairmen would be selected taking into account the
need to maintain geographic balance among countries. After
determining the logistics, setting meeting sights, and assigning
Chairs and Vice-Chairs for these negotiating groups, the Ministers
mandated the TNC to develop a working program for the negotiating
groups in order to ensure that they began their work no later than
the 30th of September, 1998 (Official Documents, p
343 and 344).
The Negotiating Groups, as conceived in San
José, are as follows (Official Documents, p. 344):
Negotiating Group |
Chair |
Vice-Chair |
1. Market Access |
Colombia |
Bolivia |
2. Investment |
Costa Rica |
Dominican Republic |
3. Services |
Nicaragua |
Bahamas |
4. Government Procurement |
United States |
Honduras |
5. Dispute Settlement |
Chile |
Uruguay-Paraguay |
6. Agriculture |
Argentina |
El Salvador |
7. Intellectual Property Rights |
Venezuela |
Ecuador |
8. Subsidies, Antidumping and
Countervailing Duties |
Brazil |
Chile |
9. Competition Policy |
Peru |
Trinidad and Tobago |
The Chairman and Vice-Chairman of each group were
selected with the need to maintain geographic balance in mind. The
groups involved will report their results to the TNC no later than
December 2000
All negotiating group meetings will be held in a
single venue, which will rotates among three countries according to
the following schedule:
Location of Working Group Meetings |
Date |
Miami, United States |
May 1, 1998 to February 28, 2001 |
Panama City, Panama |
March 1, 2001 to February 28, 2003 |
Mexico D.F., Mexico |
March 1, 2003 to December 31, 2004 |
The extensive preparatory work that was done
between 1995 and early 1998, including that of the TNC and the 12
working groups, allowed the Heads of State and Government to
officially launch FTAA negotiations in April of 1998 at the Santiago
Summit.
Chairmanship of the FTAA (1998 San José):
In San José, Ministers also determined the
peculiarities of chairing the FTAA. The Chairmanship of the FTAA
process will rotate among different countries at the end of each
Ministerial Meeting. The country that will chair the FTAA process
will host the Ministerial Meeting and will also chair the TNC. The
countries that will hold the Chair and Vice-Chair of the FTAA
process will be:
|
May 1, 1998-Oct. 31, 1999 |
Nov. 1, 1999-April 30, 2000 |
May 1, 2001-Oct. 31, 2002 |
Nov.1, 2002-conclusion of negotiations |
Chair |
Canada |
Argentina |
Ecuador |
Co-chair between Brazil and the U.S. |
Vice-chair |
Argentina |
Ecuador |
Chile |
|
Consultative Group on Smaller Economies (1998 San
José):
Ministers also created a Consultative Group with
the following instructions: a) follow the FTAA process, keeping
under review the concerns and interests of the smaller economies,
and b) bring to the attention of the TNC the issues of concern to
the smaller economies and make recommendations to address these
issues.
Administrative Secretariat for the Negotiations
(1998 San José):
The Administrative Secretariat for the
negotiations will report to the TNC and will:
- Provide logistical and administrative support to the
negotiations;
- Provide translation services for documents and interpretation
during deliberations;
- Keep the official documents of the negotiations; and
- Publish and distribute documents.
The Tripartite Committee Institutions will fund
the Administrative Secretariat, and the TNC will determine the size
and composition of the staff.
Tripartite Committee (1998 San José):
After thanking the Tripartite Committee for their
logistical support, the Ministers requested that appropriate
resources, such as allocation and technical assistance, be given to
them by respective institutions. The Ministers also expressed their
appreciation and reiterated their interest -- that the pertinent
multilateral, regional and sub-regional institutions continue to
offer additional contribution in response to specific requests from
the TNC and the negotiation groups.
Other Issues discussed in San José:
The Ministers did not exclude civil society from
their discussions on the FTAA. Instead, they reaffirmed their
commitment to the principle of transparency of the negotiation
process, which would facilitate the constructive participation of
the different sectors of society. By encouraging business and other
sectors of production, labor, environment and academic groups to
participate, they were able to establish a committee of government
representatives to receive civil society's inputs, analyze them and
present the range of views for their consideration.
Commitments to concrete progress by the year
2000, an invitation to Caricom to lead a joint government-private
sector committee of experts that will make recommendations to us at
their next meeting, and acknowledgement of Costa Rica's
contributions were also made.
The General Principles and Objectives for the
Construction of the FTAA laid out in Annex I (1998 San José):
General Principles:
- Decisions in the FTAA negotiation process will be made by
consensus.
- Negotiations will be transparent and benefit all participants
of the FTAA.
- The FTAA Agreement will be consistent with the rules of the
WTO.
- FTAA should improve upon the WTO rules and disciplines.
- The negotiations will begin simultaneously in all the issue
areas.
- The FTAA can co-exist with bilateral and sub-regional
agreements.
- Countries may negotiate and accept the obligations of the FTAA
individually or as members of a sub-regional integration group
negotiating as a unit.
- Special attention to be paid to the needs of smaller
economies, to insure their participation.
- The rights and obligations of the FTAA will be shared by all
countries.
- Measures agreed upon to facilitate the integration of smaller
economies in the FTAA process shall be transparent, simple and
easily applicable.
- All countries shall insure that their laws, regulations and
administrative procedures conform to their obligations under the
FTAA agreement.
- Differences in each countries level of participation should be
taken into account.
General Objectives:
- To promote prosperity, raise standards of living, improve
working conditions and protect the environment through increased
economic integration.
- To establish a Free Trade Area by 2005.
- To maximize market openness through a balanced and
comprehensive agreement.
- To facilitate the integration of smaller economies.
- To strive to make our trade liberalization and environmental
policies mutually supportive.
- To further secure worker rights and renew Governments
commitment to the observance of internationally recognized core
labor standards.
Annex II
To view objectives by issue area, please visit
the CICE web site. They have information on market access;
agriculture; rules of origin; customs procedures; investment;
standards and technical barriers to trade; subsidies, antidumping
and countervailing duties; government procurement; intellectual
property rights; services; competition policy and dispute
settlement.
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