CAFTA Delayed for
Costa Rica's Neighbors

Tegucigalpa (ACAN-EFE) – The New Year began yesterday with a delay for the Central American Free-Trade Agreement with the United States (CAFTA). Though it was scheduled to take effect Jan. 1 among the countries that have ratified it, U.S. leaders announced Friday that its launch date has been postponed, most likely until February.

This gives Costa Rica, the only signatory country that is still debating the agreement, at least one more month before the United States, Nicaragua, Honduras, El Salvador, Guatemala and the Dominican Republic, put in place mutual trade benefits including the elimination of tariffs on most products.

Stephen Norton, spokesman for the U.S. Trade Representative, said Friday that CAFTA will be put in effect “as the (signatory) countries make enough progress to meet the commitments set forth in the agreement.”

While leaders from most signatory nations agreed they expect it to take effect in February, Guatemalan Economy Minister Marcio Cuevas told ACAN-EFE his country has been prepared “ever since CAFTA was signed for it to take effect Jan. 1, as was initially agreed.”

He added that U.S. authorities have asked Guatemala to modify laws related to “the topic of intellectual property rights, telecommunications and government purchases, but we consider this unnecessary… It's the United States that's not prepared for CAFTA to take effect Jan. 1, because we've always been ready.”

However, Norton said no signatory country “has completed the internal procedures” necessary before the agreement can be officially launched.

Reforms pending in other Central American countries include laws to protect the environment and vulnerable sectors such as professionals and small businesses in Nicaragua, according to Wilfredo Navarro, vice-president of that country's legislature; and presidential approval in El Salvador of recent changes, approved last month in the legislature, to that country's public administration, customs and tax laws, according to President Elías Antonio Saca. Honduran Industry and Trade Minister Irving Guerrero said his country has progressed “a great deal” and that “we'll (join) when we're ready.”

Costa Rican President Abel Pacheco submitted CAFTA to the Legislative Assembly Oct. 21; in December, the International Affairs Committee began reviewing the text of the pact. Business leaders here say once the agreement takes effect between the United States and the other signatory countries – if not before that event – local enterprises will lose business, and foreign corporations will look elsewhere.

Many of the pact's opponents criticize the changes the United States requires Costa Rica to make to take part in the agreement – similar to the reforms delaying the pact in other signatory countries. Costa Rica 's commitments, should the pact be ratified, include the gradual opening of the state-owned telecommunications and insurance monopolies to competition.