Washington, D.C. ? Congressional Democratic leaders announced Thursday that they had forged new trade policy guidelines with the administration that will elevate labor and environmental rights to key components in future free trade agreements.

House Speaker Nancy Pelosi, flanked by Treasury Secretary Henry Paulson and U.S. Trade Representative Susan Schwab, said the agreement signaled “a giant step forward” in advancing U.S. economic interests without sacrificing American workers and the environment.

The new policy will apply immediately to pending free trade agreements with Peru and Panama. It also will become a part of trade accords with South Korea and Colombia, although lawmakers said other issues, such as violence in Colombia, must be dealt with before Congress can consider those agreements.