The initiative aims to promote broad prosperity and solve some of the Western Hemisphere’s toughest problems, including mass immigration to the United States.
But the American Partnership for Economic Prosperity (APEP) President Biden The deal, which was launched at a summit with regional leaders in June, lags behind traditional trade deals the US has negotiated in the past.
“It’s reasonable for people to be skeptical about how much of a real impact this will have,” said Matthew Goodman, a former White House official in the Obama administration and now at the Center for Strategic and International Studies.
The APEP reflects the administration’s desire for stronger regional ties to reconcile efforts with congressional opposition to greater trade liberalization, which many lawmakers – and the president’s union allies – blame for the loss of millions of American manufacturing jobs. Biden’s aides are pursuing the Indo-Pacific Economic Framework for Prosperity, a similar agreement in talks with 12 countries in Asia.
The Latin American edition of the administration comes in: Chinese significantly expanded its influence in the region. Chinese customers buy almost 15 percent of the region’s exports, up from just 1 percent in 2000. International Monetary Fund. A total of 21 Latin countries, including eight APEP members, are participating in Beijing’s global infrastructure investment programme, known as the belt and road initiative.
The United States already has trade agreements with nine countries that have agreed to participate in the initial APEP negotiations. The APEP group includes Barbados, Canada, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, Mexico, Panama, Peru and Uruguay.
Brazil and Argentina, two of the region’s largest economies, are experiencing notable shortcomings in the first round of talks.
No date has been set for the start of official talks, although US officials have said that negotiations will begin soon.
“We will act very quickly,” said an administration official, who insisted on anonymity to brief reporters before the official announcement.
Officials said the partnership was designed to promote labor standards, supply chain resilience, decarbonisation and pandemic recovery, rather than provide greater access to the US market.
The administration also hopes to bring a breath of fresh air to the Inter-American Development Bank, a multilateral financial institution that has been criticized for making ineffective lending.
Briefing journalists, officials offered a few details about the partnership, which they described as a “flexible framework” to include “high standard agreements”.
Regional officials and analysts said they were stunned by the lack of concrete results after Biden’s statements last summer.
“Of course we are happy to participate,” said a senior official from a participating country. “But it’s an invitation to speak. If you compare it to, for example, when trade deals are negotiated, there is no offer. It’s much more modest and limited.”
The official, who asked not to be quoted to be candid, said many countries are asking for more investment.
But it is unclear how the US will pressure this to happen in this very competitive world. “The Chinese are everywhere and the Europeans are very active in Latin America today,” he said.
The Biden administration’s proposal contrasts sharply with previous US efforts to increase trade with its southern neighbors. In 1994, 34 countries agreed to start negotiations aimed at the Free Trade Area of the Americas (FTAA). The agreement would gradually reduce tariffs and other trade restrictions over a large region stretching from northern Canada to the southern tip of Argentina.
After the negotiations failed, the United States turned to negotiating smaller deals with countries like Colombia.
Jose Fernandez, undersecretary of state for economic growth, energy and the environment, recently defended the Biden administration’s approach to trade deals in a speech at CSIS.
“What we’re trying to do is create new rules for the road, create rules of the road where our workers can compete – not a race to the bottom,” he said. “Our agreements seek to establish a new global code of conduct.”
If Biden’s new business approach ultimately supports corporate interests, voters will hold management accountable, according to Lori Wallach, a trade expert at the American Economic Liberties Project, a nonprofit that opposes concentrated economic power.
“It can have a huge political and political impact because millions of Americans who have been scolded by companies in the past for fraudulent trade deals hear that this administration has created a new trade policy to help them, and this creates expectations that can turn to anger,” he said.
Unlike a traditional trade agreement, whatever comes out of the negotiations with the countries of the region will not require congressional approval. According to Goodman, such an executive agreement would not be legally binding and would lack the mutual benefits of a full trade agreement.
“This kind of deal doesn’t have the credibility and durability of a trade deal,” he said.
