Bush says US and Panama close to free trade accord

Bush says US and Panama close to free trade accord

Mon Nov 7, 2005

By Steve Holland

PANAMA CITY (Reuters) - President George W. Bush said on Monday the United States and Panama were close to completing a free trade agreement as he ended a Latin American tour that fell short of his goal of reviving talks on a hemispheric-wide trade zone.

Bush wrapped up his trip to Argentina, Brazil and Panama with a visit to the Miraflores lock of the Panama Canal, nearly 99 years after Theodore Roosevelt came in 1906 to see the canal construction in the first visit abroad by a U.S. president.

In a Canal-related issue straining U.S.-Panama relations, Bush offered no hope of a resolution soon on a Panamanian demand that the United States do more to clean up thousands of unexploded weapons strewn across jungle firing ranges in the Canal zone.

At a joint news conference with Panamanian President Martin Torrijos, Bush said Washington felt it met its obligations under the 1977 Panama Canal Treaty that turned the key artery over to Panama.

"There is a difference of opinion. And so we have a disagreement that we will continue to discuss," Bush said.

The Panama-U.S. free trade talks started in 2003, but in February this year they faltered over Panamanian concerns that greater U.S. access to its agricultural markets could hit farmers — particularly pork, chicken and rice producers.

U.S. businesses are pushing for a package that would give them an opportunity to participate in anticipated expansion work on the Panama Canal, which is too narrow for some ships.

While Panama is considering expanding the canal, a national referendum has not yet been set. The United States remains the biggest user of the canal. Bush did not offer that Washington would pay for the project, estimated at $10 billion.

Asked how Washington would view China’s participation in widening the canal, Bush said he and Torrijos did not discuss how the project should be financed but that those who run the canal must recognize that "it is to be used by everybody."

"It’s in the interest of those who run the canal not only to modernize it, but to make sure it’s used properly," he said.

In the absence of a hemispheric-wide trade zone, Washington has been focusing on bilateral agreements with individual countries and already has a free trade pact with neighbors Canada and Mexico, and is close to clinching a similar deal with Central American nations.

"We are in the midst of negotiating a free trade agreement with Panama," Bush said. "And I told the president this free trade agreement is important for America, as he told me it’s important for Panama. And we’re close to coming to an agreement, and we’ll continue to work on that agreement for the good of our respective peoples."

Bush said his drive for increased free trade within the Americas was not dead despite the failure of leaders at the 34-nation Summit of the Americas to reach an accord to push ahead with a U.S.-backed Free Trade Area of the Americas.

"Twenty-nine nations said loud and clear, ’It’s important for us to continue to advance a trade agenda that is positive for the people of this hemisphere,’" Bush said.

Dissenting countries at the Mar del Plata summit called for any future talks to begin after a World Trade Organization meeting in Hong Kong in December.

Bush was met with protests against U.S. policies and the Iraq war throughout his Latin America visit.

In Panama City, demonstrators outside a church on Sunday chanted anti-American slogans and burned effigies of Bush. They were unhappy at Bush’s visit because his father authorized the U.S. invasion of Panama in 1989 that ousted dictator Manuel Noriega and killed many Panamanians.

(Additional reporting by Tabassum Zakaria and Mike Power)

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source: Reuters