Andean nations’ trade benefits lapse

? It was promoted as a low-cost way for the United States to help Colombia and its neighbors fight drugs: Lower trade barriers to boost their economies, create jobs and give people an alternative to the drug trade.

President Bush liked the idea, as did top lawmakers from both parties. But by the end of last year, not only did Colombia, Peru, Ecuador and Bolivia not get any new trade benefits, they lost some advantages they had enjoyed for 10 years.

Colombia’s flower industry, for example, lost duty-free access to the United States and has reported a 12 percent drop in revenues this year.

About 70 percent of the flowers sold in the United States come from the Andes. Wholesalers and retailers have had to absorb the added costs, said Jennifer Sparks of the Society of American Florists.

On Tuesday, foreign ministers from the four Andean countries will visit Washington to urge lawmakers to restore the old trade benefits for flowers as well as oil, minerals, coffee and bananas. They are also seeking lower barriers for such exports as textiles, leather products and tuna, hoping to compete with countries that already have easy access to U.S. consumers.

“It’s critical,” said Luis Alberto Moreno, the Colombian ambassador. “There’s a lot of expectation in our country from the business community.”

Prospects are unclear. The Andean benefits are being lumped together in the Senate with broader and more divisive proposals. They include trade promotion authority, which would prevent Congress from modifying trade agreements negotiated by the president.

Sen. Bob Graham, D-Fla., one of the main supporters of the Andean trade bill, said the Andean trade proposals are likely to be considered in March. He is optimistic they will be approved.

The proposals “represent a strong statement of U.S. commitment to the expanded international trade and they will reinforce each other in congressional support,” he said.

The Andean Trade Preferences Act was approved in 1991, cutting tariffs for flowers, ceramics and other products from Colombia, Peru, Ecuador and Bolivia.

As the December 2001 deadline approached, Andean nations sought an expanded version to give textiles, tuna and other products access to U.S. markets, similar to that enjoyed by Mexico under the North American Free Trade Agreement and Caribbean nations under a 1998 trade law.

The U.S. textile industry, arguing it was already hurt by imports, fought against the bill.

“The textile industry right now is going through its worst economic crisis since the Depression, so we are extremely concerned when bills like this come up which would throw more U.S. textile workers out of their jobs,” said Cass Johnson of the American Textile Manufacturers Institute.

Concerns were also raised that American Samoa’s tuna industry would lose jobs because of imports from Ecuador.

In the face of this opposition and a crowded agenda, Congress did little on Andean trade until the end of the year.

The bill easily passed the House in November. It was approved by the Senate Finance Committee in December, but never made it to the full Senate. A last-ditch effort to extend the old Andean preferences failed, and they expired on Dec. 4.

Graham said it was better to let the act lapse to keep up pressure for broader trade benefits.

“It was important enough to not just continue the 1991 program, but to have a 21st century improvement … even if it entailed the pain and disruption of a hiatus in the special trade preferences,” he said.