It's a hefty to-do list, and Administration critics charge that Bush's recent tilt toward protectionism will make it tough to complete. After all, negotiators from across the Atlantic to south of the border question whether the U.S., which recently imposed steel tariffs and approved massive new farm subsidies, is willing to open its markets further. "You can't preach free trade and apply trade restrictions at the same time," says Alfredo Thorne, J.P. Morgan Chase & Co.'s chief Latin America economist.
Yet even if the President only ticks off a few items on his list, he could very well emerge a big winner in the global trade sweepstakes. "Steel tariffs and ag subsidies were a detour," says Robert D. Hormats, managing director of Goldman Sachs International. "President Clinton couldn't get fast-track, but President Bush is about to. This gives him a leadership role the U.S. hasn't had since 1994" when the last fast-track law lapsed.
One reason Bush may surprise his critics is that the European Union, which can't seem to agree with the U.S. on anything these days, sees fast-track approval as a positive sign of U.S. intentions. "The credibility of the U.S. has gone up," says Steven Everts, director of the transatlantic program for the Center for European Reform, an independent think tank. "Trade liberalization stands and falls on agreement between the U.S. and Europe."
For Bush to succeed, he'll have to bring two of the most important players, Brazil and China, back to the negotiating table. While Bush was busy bartering for votes to win a fast-track deal, Brazil lost interest in talks to establish a Free Trade Area of the Americas (FTAA). It's also feeling stung by U.S. limits on imports of Brazil's orange juice, sugar, and other farm products. China, too, is unhappy with the U.S.'s protectionist moves. With Beijing competing against Japan for influence in the region, its priority is to set up its own regional pact, an Asian Free Trade Area with 10 other Southeast Asian nations.
Yet, despite the increasingly anti-U.S. tone permeating Latin America and China these days, many business and political leaders in those regions know that increased exports are their best hope for emerging from the current economic slump. Sooner or later, says Calman J. Cohen, president of the industry-backed Emergency Committee for American Trade, other countries will calculate that it's in their own self interest to liberalize trade. Hor?cio Piva, president of the S?o Paulo State Federation of Industries, agrees: "We get disheartened because of farm bills and measures against our steel, but we could make more effort in the talks over the FTAA. [It] has a future."
Indeed, if Bush uses the fast-track process to quickly complete a free-trade deal with Chile, and finalizes another pending agreement with a group consisting of Peru, Bolivia, Ecuador, Colombia, and Venezuela, then Brazil could find itself out in the cold. Negotiations over U.S. antidumping laws, which have been a thorn in Brazil's side, could also prove fruitful. "Fast track could be an extraordinary vehicle for reengaging Latin America," says Peter Hakim, president of the Inter-American Dialogue, a Washington think tank. Adds William Lane, Washington lobbyist for Caterpillar Inc.: "The bottom line is, the Administration won the game and few people are going to look back." That will only be true, however, if Bush pushes hard to make the most of his new fast-track powers. By Paula Dwyer
With Geri Smith in Mexico City, Julie Forster in Chicago, and Andy Reinhardt in Paris