January 5, 2006

US preparing to sign trade pact with Peru: USTR

WASHINGTON (Reuters) - The Bush administration could sign a
free trade agreement with Peru before it finishes negotiations
on companion pacts with Colombia and Ecuador, a U.S. trade
official said on Thursday.

"We're working on finalizing ... the next step, which is to
notify Congress on the intent to sign the (Peru) agreement
within 90 days," said Christin Baker, a spokeswoman for the
U.S. Trade Representative's office.

The United States and Peru reached a free trade agreement
in early December after more than 18 months of talks.

Colombia and Ecuador had been negotiating alongside Peru
but were unable make enough progress in November on several
tough issues to close a deal before the end of 2005.

U.S. trade officials would prefer to send pacts with all
three countries to Congress for approval as a single package.
That has been the goal since talks began in May 2004.

But Senate Finance Committee Chairman Charles Grassley, an
Iowa Republican, has urged the Bush administration to formally
notify Congress as soon as possible of its intention to sign
the Peru agreement.

"I do not believe that consideration of the Peruvian free
trade agreement should be delayed in the event that
negotiations with Colombia or Ecuador are delayed," Grassley
said in a letter to U.S. Trade Representative Rob Portman.

U.S. trade officials are working with Colombia and Ecuador
to set dates for the next round of talks, Baker said.

The agreement with Peru and the proposed pacts with
Colombia and Ecuador would lock in trade benefits they already
receive from the United States and which are set to expire at
the end of 2006. The countries hope the pacts also will create
jobs by expanding export opportunities in the U.S. market and
attracting more business investment.

Trade experts believe Colombia is in a better position to
finish the talks than Ecuador but say both countries face
politically difficult decisions to open their agricultural and
other markets as part of the deal.

Grassley said he strongly supported free trade pacts with
Colombia and Ecuador that include the same "broad market access
commitments on agriculture" that Peru has made.

"Should negotiations with Colombia or Ecuador conclude in
the short-term, a second notification of intent could be sent
and the agreements could be considered together," he said in
his December 22 letter.