US Congressional approval of the free-trade treaty between United States and Central America is likely to help pave the way for similar regional accords and contribute to the success of WTO negotiations.
Although it just squeezed by 217 to 215 in the House of Representatives, early Thursday amid a vicious partisan battle, the CAFTA trade agreement represents a significant victory for President George W. Bush who personally visited the Lower House highlighting the treaty's contribution to economic prosperity and democratic governance in the hemisphere.
"CAFTA helps ensure that free trade is fair trade" president Bush said in a statement following the vote.
The treaty involves El Salvador, Honduras, Guatemala, Nicaragua, Costa Rica and the Dominican Republic consolidating the second strongest market for US goods and services behind Mexico.
Once the treaty becomes effective next January it will immediately eliminate trade barriers on 80% of U.S. goods including 50% of farm products gradually working towards a complete elimination of all barriers.
"By lowering trade barriers to American goods in Central American markets to a level now enjoyed by their goods in the U.S., the agreement will level the playing field and help American workers, farmers and small businesses" added Mr. Bush in the statement.
CAFTA approval coincided with U.S. Trade representative Robert Portman trip to Geneva to push for the World Trade Organization Doha round negotiations currently stalled mainly over agriculture issues such as subsidies and market access.
CAFTA should also help boost the Free Trade Area of the Americas talks which are currently frozen.
US are currently negotiating other similar free trade agreements with Peru, Ecuador and Colombia, with Panama and with several Middle East countries.