Colombia signs trade pact with China

Colombia’s government, unable to
attain a free-trade agreement with the U.S., signed a bilateral
investment treaty with China, granting most favored nation status
to each other’s companies. 

Colombian President Alvaro Uribe, speaking today at the
Asia-Pacific Economic Cooperation forum in Lima, said he wants to “deepen immensely relations with China and its government,”
according to an e-mailed transcript sent by his office.

Colombia, after lobbying unsuccessfully for the U.S.
Congress to approve a free-trade agreement reached in February
2006, is broadening its trade agenda to catch up with regional
neighbors that have been rushing to embrace Asia. Echoing
Democratic lawmakers’ concerns over Colombia’s human-rights
record, President-elect Barack Obama has said he opposes a trade
accord with the U.S. ally in the fight against drugs.

“The single-minded obsession with the U.S. trade deal has
taken its toll on Colombia’s broader trade agenda,” Michael
Shifter, vice president of the Washington-based think tank Inter-
American Dialogue, said in an interview. “They haven’t read the
tea leaves right about the changing economic balance in the world
or the growth of anti-trade sentiment in the United States.”

Uribe came to Lima invited by Peruvian President Alan Garcia
to push for a lifting of a moratorium on new membership that
would allow them to join Mexico, Peru and Chile as a member of
APEC. Peru this week followed Chile in signing a free-trade
agreement with China. Both already have accords with Singapore
and Thailand, as well as the U.S.

Colombia’s economy is one of the most closed in Latin
America, with average tariffs of 12.5 percent, more than double
those of Chile, according to World Trade Organization data. Friday, it signed a free-trade agreement with Canada,
extending to 13 the number of countries it has reached accords
with. By contrast, Guatemala, whose economy is one-fifth the
size, has agreements with 23 countries and Chile with 44,
according to Colombian trade ministry statistics.

Democrats in Congress earlier this year delayed a vote on
the trade accord with Colombia, denying Uribe a chance at his
most significant foreign policy victory. Uribe said he would
continue to pursue the U.S. accord “with urgency and patience.”

“I come here to ask that you intervene before your American
friends so that the U.S. votes on the trade agreement,” Uribe
said in a separate speech today to applauding business leaders. “`We need to hear the same noise in the U.S. House of
Representatives.”

The U.S.-Colombia agreement, which would be Washington’s
biggest in the Western Hemisphere since the North American Free
Trade Agreement in 1994, has languished over Democrats’ concerns
that Uribe isn’t doing enough to stamp out violence against labor
organizers. The U.S. is Colombia’s biggest trading partner and
source of over $700 million in annual anti-narcotics aid.

The agreement with China, announced last month, puts
investors from each country on a level footing with national
companies, banning expropriation without fair compensation and
providing for international arbitration in case of commercial
disputes. (Bloomberg)

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