United States Of America : Bush Administration to Negotiate Separate FTA with Dominican Republic

The Bush Administration said it plans to negotiate a separate free trade agreement with the Dominican Republic and eventually integrate the country into the current trade pact being negotiated with five Central American countries. U.S.

Trade Representative Robert Zoellick notified Congress Tuesday of the administration''s intent to negotiate a bilateral deal and include the Caribbean''s largest economy into the Central American Free Trade Agreement. It is still unclear how the administration will attempt to integrate the Dominican Republic into a CAFTA trade pact. One possibility is to have parallel negotiations. Once the two separate trade deals are completed, the administration could try to link the Dominican Republic to the CAFTA through a provision that would allow it to receive the same benefits as El Salvador, Guatemala, Costa Rica, Nicaragua and Honduras. All five Central American countries would have to agree on the inclusion of the Dominican Republic, according to industry experts.

The Dominican Republic, which exported $2.17 billion worth of apparel and textiles to the U.S. in 2002, has been clamoring to get into the CAFTA negotiations since the launch of the talks. Trade officials originally excluded the Dominican Republic from the talks because it did not belong to an existing customs union between the five Central American countries. Importers and domestic textile groups alike applauded the announcement but divisions run deep in how much market access the U.S. should grant to Central America.

In 2002, imports from the five countries totaled 2.86 billion square meters equivalent with a combined value of $6.98 billion, according to the Commerce Department. Total U.S. textile exports to the five countries amounted to more than $4 billion last year.