Prospects for CAFTA passage remain murky

Food & Drink Weekly, May 30, 2005

The Bush administration and many U.S. agriculture groups and firms have begun a concerted push for approving DR-CAFTA. Proponents of the Dominican Republic-Central America Free Trade Agreement (DR-CAFTA) had a meeting at the White House last week and it was made clear that many in the agriculture community, and President Bush himself, will fight hard for the agreement to be approved by Congress. President Bush talked at the meeting held in the Roosevelt Room in the White House. Deputy Chief of Staff Karl Rove and Commerce Secretary Carlos Gutierrez also attended the meeting.

U.S. sugar groups and some lawmakers from sugar cane and sugar beet states are opposed to DR-CAFTA. Proponents of the trade agreement discussed the sugar policy matter in a letter last week sent to President Bush. A similar letter is expected to be sent to lawmakers this week. Senate Finance Chairman Chuck Grassley (R-Iowa) last week said he would hold a mock markup of draft implementing legislation regarding DR-CAFTA the week of June 13. If so, the agreement should reach the Senate floor in July. DR-CAFTA proponents say they will not rewrite the agreement to satisfy sugar industry opponents of the measure, but there are some administrative ways of dealing with any concerns that the industry may have.

Meanwhile, Rep. Bill Thomas (R-Calif.), chairman of the House Ways and Means Committee, said May 24 that he will call for an initial committee vote on DR-CAFTA as soon as the Senate Finance Committee has acted. "We're ready to move forward," Thomas said, adding that he believes there will be enough committee votes to clear a "mock mark-up" of legislation to implement the agreement. Thomas also said that he does not think it will be necessary to cut any special deals with members on sugar to win their support. "I don't think so," he said. "I think the agreement is a very fair agreement." He said that the "relative strength" of those who would "walk the plank [on sugar] isn't as great as you would think."

Thomas said he is also not concerned that the administration will seek to make concessions to members of Congress on the sugar issue to ensure passage of the agreement. "That's not my primary concern or even my secondary concern," he said.

DR-CAFTA is a top priority for President Bush, and he said he hopes the agreement will see passage in Congress this summer. Administration officials, including U.S. Trade Representative Rob Portman, Commerce Secretary Gutierrez, National Security Adviser Stephen Hadley and Karl Rove, have indicated they want to see the agreement passed in the House before the Fourth of July recess. During a recent radio address, President Bush called on Congress to approve DR-CAFTA, saying that it will help U.S. long-term economic security. The President also said DR-CAFTA "would help the new democracies in our hemisphere deliver better jobs and higher labor standards to their workers, and it would create a more level playing field for American goods and services."

The tide is beginning to turn somewhat in Congress from one of certain defeat to one of too-close-to-call. If the White House and the pro-agreement industry lobbyists continue their aggressive support, our sources think the votes could be there for eventual passage. But should the agreement be put to a vote and fail, it would be a major political defeat for President Bush. USTR Rob Portman says he thinks that educating uncertain lawmakers about the strengths of the agreement is the best approach to getting it approved by Congress.