The initiative aims to promote broad prosperity and address some of the Western Hemisphere’s most pressing challenges, including mass migration to the United States.
But the American Partnership for Economic Prosperity (APEP), which President Biden It falls short of traditional trade deals negotiated by the US in the past at a summit of regional leaders in June.
“It’s reasonable for people to be skeptical about how much real impact this will have,” said Matthew Goodman, a former White House official in the Obama administration who is now at the Center for Strategic and International Studies.
APEP represents an effort to reconcile a desire for stronger regional ties with congressional opposition to further trade liberalization, which many lawmakers and the president’s union allies blame for the loss of millions of American manufacturing jobs. Biden aides are negotiating a similar agreement with 12 Asian countries, the Indo-Pacific Economic Framework for Prosperity.
Here comes the administration’s Latin American push demon has greatly expanded its influence in the region. In 2000, Chinese customers bought 15 percent of the region’s exports. International Monetary Fund. A total of 21 Latin countries, including eight APEP members, are participating in Beijing’s global infrastructure investment program known as the Belt and Road initiative.
The United States already has trade agreements with nine of the countries that agreed to participate in the initial APEP negotiations. The APEP group includes Barbados, Canada, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, Mexico, Panama, Peru and Uruguay.
Among the notable absentees from the first round of talks are Brazil and Argentina, two of the region’s largest economies.
No date has been set for formal talks to begin, although US officials have said talks will begin soon.
“We’re going to move very quickly,” said one administration official, who spoke on condition of anonymity to brief reporters before the official announcement.
Instead of offering greater access to the U.S. market, the partnership is designed to promote labor standards, supply chain resilience, decarbonization and pandemic recovery, officials said.
The administration also hopes to breathe new life into the Inter-American Development Bank, a multilateral financial institution criticized for inefficient lending.
Officials briefed reporters offered few specifics about the partnership, which they described as a “flexible framework” that includes “high-standard agreements.”
Regional officials and analysts said they were baffled by the lack of concrete results since Biden’s remarks last summer.
“Of course, we are happy to participate,” said a senior official of the state party. “But this is an invitation to talk. There is no suggestion, for example, if you compare it to when trade agreements are being negotiated. It is more modest and limited.”
Many countries want more investment, said the official, who asked not to be quoted for confidentiality.
“However, it is not clear how the United States will insist on this happening in this very competitive world. The Chinese are everywhere, and the Europeans are very active in Latin America today,” the official said, questioning whether the partnership would meet the region’s investment needs.
The Biden administration’s proposal stands in stark contrast to previous efforts to increase US trade with its southern neighbors. In 1994, 34 countries agreed to begin negotiations on the Free Trade Area of the Americas (FTAA). The agreement would gradually lower tariffs and other trade restrictions in a large area stretching from northern Canada to the southern tip of Argentina.
After the negotiations failed, the United States moved to negotiate smaller deals with countries such as Colombia.
Speaking recently at CSIS, Under Secretary of State for Economic Growth, Energy and Environment Jose Fernandez defended the Biden administration’s approach to trade deals.
“What we’re trying to do is create new rules of the road, create rules of the road where our employees can compete — not a race to the bottom,” he said. “Our agreements seek to create a new global code of conduct.”
Voters will hold the administration accountable if Biden’s new approach to trade favors corporate interests, according to Laurie Wallace, a trade expert at the American Economic Freedom Project, a nonprofit that opposes concentrated economic power.
“This could have a larger policy and political impact as millions of Americans criticized by past corporate-rigged trade deals hear that this administration is creating new trade policies to help them, raising expectations that could turn into outrage,” he said.
Unlike a traditional trade agreement, whatever comes out of negotiations with countries in the region will not require congressional approval. According to Goodman, such an executive agreement would have no legal effect and would lack the mutual benefits of a full trade pact.
“This kind of agreement lacks the credibility and sustainability of a trade agreement,” he said.
