November 23, 2005

US and Peru make progress on trade deal

By Doug Palmer

WASHINGTON (Reuters) - The United States and Peru could
meet again soon to finish work on a free-trade agreement, both
countries said on Wednesday as they adjourned eight days of
talks for the U.S. Thanksgiving holiday.

"We're making good progress. We still have some tough
challenges," said Neena Moorjani, a spokeswoman for the U.S.
Trade Representative's Office. "We're going to continue to talk
over the next couple of weeks and might get together (for a
formal meeting) before (the December 13-18) Hong Kong" World
Trade Organization meeting.

The United States is closer to reaching a deal with Peru
than with its two neighbors, Colombia and Ecuador, she said.

"We're adjourning the negotiations for Thanksgiving and for
consultations with Congress and industry," Moorjani said.

Peru had been considered the farthest along when the three
countries began a 13th round of negotiations with the United
States early last week. President Alejandro Toledo said earlier
he wanted Peru to finish the deal during this round.

Peru remains optimistic a deal can be agreed on soon and
expects talks to restart at the beginning of next month,
Peruvian Prime Minister Pedro Pablo Kuczynski said in Lima.

The two most difficult areas of the talks are agriculture
and intellectual property rights, a broad category covering
protections for patents and copyrights, both sides said.

"We consider the conditions are still not right to close a
balanced deal that would benefit Peru," Peruvian Trade Minister
Alfredo Ferrero told Peruvian radio. "We're negotiating some
quotas so as not to affect local (farm) production here."


The Andean countries have large farm populations and have
been reluctant to liberalize their agriculture sectors as much
or as quickly as the United States wants.

Colombia has argued it needs special treatment for several
farm products -- including rice, chicken leg quarters and corn
-- to keep its farmers from turning to coca, a lucrative crop
used to make cocaine.

Colombia and its Andean neighbors supply more than 90
percent of the cocaine sold in the United States.

The proposed U.S.-Andean free-trade agreement would replace
a one-way U.S. trade preference program intended to help create
Andean jobs outside the illegal drug sector.

Colombian negotiators said they still hoped to reach a deal
with the United States by the end of the year, while Ecuadorean
officials did not expect talks to resume before January.

"We continue to engage intensively with both countries,"
Moorjani said, without confirming Colombian comments the two
sides could get together after the Hong Kong meeting.

Colombian President Alvaro Uribe said Andean nations should
keep pressing for a deal with the United States.

"If our Andean neighbors and the U.S. government are
willing, we should not leave the negotiation table but look at
fair options," Uribe told reporters in Bogota.

The Andean countries also have been concerned that patent
provisions pushed by the United States in the negotiations
could increase the price of medicines.

At the same time, they want intellectual property rights
rules to cover the region's vast biodiversity so they can share
in the profits of any products made from local plant life or
based on the knowledge of indigenous peoples.

(Additional reporting by Javier Mozzo Pena in Bogota and
Marco Aquino and Teresa Cespedes in Lima)