May 17, 2006

US door not shut on Ecuador trade deal: Portman

WASHINGTON (Reuters) - The United States has not completely
shut the door on free trade talks with Ecuador, but recent
actions by that government make a deal much harder to reach,
U.S. officials said on Wednesday.

U.S. Trade Representative Rob Portman told reporters that
Ecuador's seizure of oil fields operated by a U.S. company was
"unfortunate" because the United States still had some hopes of
reaching a free trade agreement with the Andean country.

"We are very eager to engage with Ecuador but it's
difficult to engage while they are taking certain actions with
regard to legitimate U.S. investment," Portman said.

Asked directly if the United States had closed the door on
future talks, Portman said "no."

But Christin Baker, a spokeswoman for the U.S. Trade
Representative's office later added: "The United States is not
calling the talks off, but a date has not been set to resume
them either."

Ecuador terminated its contract with U.S. firm Occidental
Petroleum earlier this week and officials said they would
complete the takeover of Occidental oil fields in less than 60

The United States and Ecuador have been negotiating a free
trade agreement since May 2004, but the talks were hung up on
agriculture and investment issues before Quito's latest move.

"It's unfortunate because I think we had the opportunity to
come together with a good agreement for Ecuador and for U.S.
exporters and service providers. We'll see what happens,"
Portman said after a Senate confirmation hearing to consider
his nomination as the next U.S. budget director.

A spokeswoman for the U.S. Trade Representative said on
Tuesday the U.S. was pressing Ecuador to clarify its actions,
including whether it intended to compensate Occidental.

Ecuador plans to carry out an independent audit to
determine whether the state oil company Petroecuador or foreign
operators will run the oilfields taken from Occidental, a
presidential spokesman said on Tuesday.