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Americas leaders fail to end free-trade stalemate

Posted on: Saturday, 5 November 2005, 18:27 CST

By Mary Milliken and Kevin Gray

MAR DEL PLATA, Argentina (Reuters) - Leaders from around the Americas failed on Saturday to resolve key differences over how to create a hemisphere-wide free trade zone during a regional summit overshadowed by violent anti-U.S. protests.

Talks on creating the U.S.-proposed Free Trade Area of the Americas, or FTAA, have been stalled and the Bush administration had hoped to jump-start discussions here to establish the world's most populous free-trade bloc.

But Chilean President Ricardo Lagos said differing views over how to proceed persisted at the two-day summit in this Argentine seaside resort. Officials were still working on a final declaration and talks extended hours after a deadline.

"The point of contention is if the conditions are there for us to negotiate. A great majority said 'Yes' but others said 'Let's wait"' until an upcoming World Trade Organization (WTO) meeting, he said.

The United States and Mexico had been hoping to set an April date to move the trade talks forward, a move opposed by Argentina, Brazil, Paraguay and Uruguay.

Venezuelan President Hugo Chavez, Washington's most aggressive antagonist in the region for his self-styled socialist revolution, arrived at the fourth Summit of the Americas vowing to "bury" efforts to move FTAA forward and rallied 25,000 anti-free trade protesters on Friday.

Hours later, a separate anti-U.S. demonstration turned violent blocks from where Bush and the 33 other leaders were meeting.

Some 200 protesters battled riot police for more than two hours during the protest before torching a bank branch and shattering store windows along a major boulevard in this Argentine beach resort. Officials said 64 people were arrested but no major injuries were reported.

'A UNIQUE ACCORD'

U.S. National Security Advisor Stephen Hadley later told reporters aboard Air Force One, traveling with Bush en route to Brazil, that although no accord was reached, progress was still made in the bid to create a free-trade zone stretching from Alaska to Argentina.

"It's not deadlocked," Hadley said. "We went from a summit that was supposed to bury FTAA to a summit in which all 34 countries actually talked in terms of exchanged trade and the FTAA."

Hadley added: "There is nothing in stone that says any time leaders get together, they have to have a communique."

He said Bush listened as well as expressed the U.S. view.

"His approach is to not to try and dominate but to participate as one of equals and listen, and that's what he did," Hadley said. "At critical times he made his views obviously clear."

Bush and Chavez did not interact at the meetings. "Their paths did not cross," Hadley said.

Although not outrightly opposed to FTAA like Chavez, leaders from Latin America's big agricultural economies Brazil and Argentina have also voiced concern over any free trade deal, complaining about U.S. farm subsidies.

"Free trade is very important if we respect equality among nations," Brazilian President Luiz Inacio Lula da Silva told reporters. He added that it was "not opportune" to discuss FTAA before a crucial WTO meeting next month in Hong Kong where subsidies would be a key issue.

Bush's stop in Brazil is the second part of a Latin American trip that will also include a stop in Panama.

Ahead of his arrival, police in Sao Paulo fired tear gas and used batons to disperse a crowd of about 1,000 people protesting in the city center against Bush's visit.

The march began peacefully with protesters shouting "Go home Bush!" as they streamed along Avenida Paulista, the main business district boulevard, between two U.S. bank branches. Police responded after some protesters began throwing rocks.

In comments to reporters in Mar del Plata, Lagos suggested that talks between regional leaders had at times been tense.

"Something happened here that rarely happened in other meetings: the call to speak out loud was taken up by everyone," Lagos said. "At times, we all talked out loud, perhaps too loud, but it made the meeting that more interesting.

(Additional reporting by Paulina Modiano, Steve Holland, Tabassum Zakaria, Guido Nejamkis and Cesar Illiano in Mar del Plata)

Source: REUTERS

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