October 4, 2006

October 4, 2006 | WebMemo on Trade, Economic Freedom

U.S. Trade Policy Tracker: An Update

The signing of the U.S.-Oman free trade agreement (FTA) last month marks the tenth FTA between America and its trade partners. With more than 90 percent of the world's consumers living outside of the U.S., seizing the opportunity to further expand free trade is vital. Currently, an FTA with Peru and the establishment of permanent normal trade relations (PNTR) with Vietnam await congressional approval. FTA negotiations with South Korea, Malaysia, the United Arab Emirates, and Panama are moving forward.

 

Status of Trade Agreements (as of October 2006)[1]

 


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Major Trade Agreement Negotiations

 

  • Malaysia: Since Congress was notified in March 2006, two rounds of negotiations have been completed.
  • Panama: Congress was notified in November 2003, and the first round of negotiations started in April 2004.
  • South Korea: Since Congress was notified in February 2006, three rounds of negotiations have been held.
  • Thailand: Congress was notified in February 2004, and formal negotiations started in June 2004. Currently, political turmoil in Thailand has halted formal negotiations.
  • United Arab Emirates: Congress was notified in November 2004, and the first round of negotiations started in March 2005.

Congressional Approval and Implementation

 

  • Peru: The Administration initiated FTA negotiations in May 2004, and an agreement was concluded in April 2006.
  • Colombia: The Administration initiated FTA negotiations in May 2004, and an agreement was concluded in February 2006. On August 24, 2006, President Bush formally notified Congress of his intention to sign the trade pact with Colombia, and Congress is likely to consider the FTA next year at the earliest.

In addition, the U.S. has recently concluded and signed a bilateral market access agreement with Vietnam. This agreement is an important step toward normalizing bilateral relations and is required for Vietnam's accession to the World Trade Organization. In order for the agreement to take effect, Congress must approve Permanent Normal Trade Relations (PNTR) status for Vietnam, authorizing trade advantages that the United States grants to most countries. In order to authorize PNTR, Congress must rescind the application of the Jackson-Vanik amendment to the Trade Act of 1974 to Vietnam.[2] 

 

Continued American leadership on international trade depends not only on the intensive efforts of U.S. trade negotiators, but also on con­gressional support for free trade. The successful conclusion of negotiations and swift congressional implementation of beneficial free trade agreements will afford America a chance at a brighter future.

 

Anthony Kim is Research Data Specialist and Daniella Markheim is Jay Van Andel Senior Trade Pol­icy Analyst in the Center for International Trade and Economics at The Heritage Foundation.



[1] For more detailed information on the FTA process, see Anthony Kim and Daniella Markheim, "U.S. Trade Policy Tracker," Heritage Foundation Backgrounder No. 1949, July 2006, at http://www.heritage.org/Research/TradeandForeignAid/bg1949.cfm.

 

[2] The Jackson-Vanik provision denies normal trade relations to certain countries with non-market economies or restrictions on emigration rights.

 

About the Author

Anthony B. Kim Research Manager, Index of Economic Freedom, and Senior Policy Analyst
Center for Trade and Economics (CTE)

Daniella Markheim Jay Van Andel Senior Analyst in Trade Policy
Center for Trade and Economics (CTE)

Related Issues: Trade, Economic Freedom