Building Momentum but Problems Remain for the Colombia – U.S. Free Trade Agreement

On April 7, 2008, President George W. Bush delivered the American/Colombian Free Trade Agreement (FTA) to Congress with hopes that it would receive timely approval. Bush lamented that trade restrictions with Colombia were so asymmetrical that “our markets are open to Colombian products, but barriers exist to make it harder to sell American products in Colombia.” The trade treaty, agreed to by both Colombia and the Bush administration, has awaited congressional ratification since it was signed in November 2006. The treaty languished for years until 2011, when President Obama gave his State of the Union address which directly highlighted the pending FTA with Colombia as well FTAs with Panama and South Korea that Congress had also passed over. President Obama stated, “Before I took office, I made it clear that we would enforce our trade agreements, and that I would only sign deals that keep faith with American workers, and promote American jobs. That’s what we did with Korea, and that’s what I intend to do as we pursue agreements with Panama and Colombia.” 1

Following up on this promise, the White House has sent a delegation to Colombia to analyze the status of the human rights situation regarding the systematic murders of union members. Paramilitary murders of organized labor leaders in Colombia have been a major factor discouraging U.S. congressional support of the FTA.2 The U.S. trade representative ambassador Ron Kirk has stated that the FTA with Colombia “is not just related to market access; it goes to core values… That is something we won’t compromise on.”3 One of the “core values” Kirk is referring to is the Democratic Party’s hesitation to liberalize trade with a country that has become notorious for its labor abuses, which could alienate the party’s unionized base.

Opposition to the Colombia FTA is centered on its history of paramilitary labor abuses. Colombia is the world leader in the murder of trade union members; there have been 2,800 reported killings since 1986.4 Since his election in 2010, Colombian President Juan Manuel Santos has attempted to stem paramilitary violence against union leaders and root out corruption in the government. “President Santos has promoted legislation to restore land to displaced persons and compensate victims of abuses by state agents, publicly voiced respect for an independent judiciary, and denounced threats against human rights defenders,” states Human Rights Watch in its 2011 World Report. “However, it remains to be seen whether his approach translates into concrete results in light of serious ongoing abuses,” the report added.5 While there is a serious effort in Colombia to curb this violence, 36 people were still killed in 2010 as a result of paramilitary brutality.

Matthew Rooney, the State Department’s Deputy Assistant Secretary for Canada, Mexico and Regional Economic Policy stated, “It’s our objective to clarify the situation in Colombia, to do a fresh analysis of the situation in Colombia, and also in Panama. The objective is to have the FTAs transmitted to the Congress by around the middle of the year, with the objective of having them completed, approved by the Congress, maybe before the end of the year.”6 Whether or not the Obama administration consents to supporting the FTA rests on the discoveries of the delegation and the political climate created by the Democratic Party. If U.S. policymakers feel that the personal security of labor union members is still too threatened in Colombia, it will be unlikely that the FTA will be able to win the necessary congressional backing.

The recent action to move the FTA forward comes after the Andean Trade Preferences Act (ATPA) expired on February 12 and was deliberately not extended by Congress. This agreement, which essentially eliminated Colombian export tariffs on over 6,000 goods to Americans, is critical to many Colombian firms doing business in the United States.7 Yet the extension measure failed to pass largely because of congressional partisanship.8 Senator John McCain has been pushing for the ratification of the FTA and recently came out in support of extending the ATPA. In a recent bid to convince other congressional leaders, McCain asked fellow congressmen to “please consider at least a short-term extension of ATPA … People have laid down their lives in the war against drugs. It’s a sad, sad day for our dear friends in Colombia.”9 The domestic political maneuvering has some skeptics asking whether campaign contributions are playing a part in the FTA’s passage through Congress.

Despite U.S. sluggishness to act on either the FTA or the extensions, President Santos tried to reassure Colombian businesses about the expired act. “Don’t worry, possibly what will happen is that when [the U.S. Congress] passes [the extension] they will do it retroactively. That is, you will not have to pay any duties on any products, because they will give it back to you.”10 Although the Colombian president was confident that the ATPA extension would be passed, he appears tired of waiting for the U.S. to authorize the long overdue FTA, expressing the sentiment that “if the FTA isn’t approved this year, we will not continue to insist.”11 The president’s attitude of frustration with the U.S. has evolved since the near completion of the Canadian FTA and trade increases between Colombia and regional countries such as Argentina.12

The present Colombian government is making serious efforts to legitimize its practices and curb human rights violations within its borders. Provided that Obama’s delegation does not unearth any shocking new information, the president should put serious effort into ushering the FTA with Colombia through Congress. Further stalling the FTA—especially now that the ATPA has expired—will needlessly hurt both American and Colombian businesspeople with little to show for it. Luis Guillermo Plata, Colombia’s Minister of Trade, once expressed in 2008 that, “One could make an argument that not having an FTA could be equivalent to having trade sanctions imposed on Colombia…..And in our opinion, you don’t do that to an ally.” Plata acknowledged that union murders are the central issue halting the agreement. President Santos’ recent efforts have reduced the number of union members killed from 196 in 2002 to 26 in 2010. “The only right number is zero,” said Plata. Nevertheless, he asked, “if it wasn’t 26 union members killed but it was 13, would that mean that the FTA would be approved immediately? Probably not.”13

Eliminating trade barriers between Colombia and the U.S. could be a win-win situation. The U.S. should not wield its trade policy as an imprecise diplomatic tool as it has done in the past with countries like Cuba. The administration’s move to send a delegation to Colombia is ponderous considering that the state of human rights abuses in Colombia is well known by both governments. It is likely that this is merely a political or symbolic move to buy time to shore up congressional support to enact the bill, or it’s a precursor to justify shelving the FTA if the domestic political climate turns unfavorable.

There is no reason to believe that postponing the Colombia FTA will help alleviate human rights issues, which appears to provide grounds for the only real opposition to the agreement. The Colombian government’s support of the FTA and its efforts to strike out its domestic problems might highlight the new administration’s dedication to human rights issues if Santos stands steadfast. In the eyes of Colombian and American businessmen and officials, continuing to stall trade agreements because of unrelated political issues only damages commerce and relationships between these two hemispheric partners in the long run. Considering that Colombia maintains FTAs with other countries, continuing the American policy of trade protectionism for the sake of political pressure would accomplish very little other than killing potential mutually profitable economic interactions. However, what is fundamental here is that human rights values must take precedence over trade, and that Colombian officials must understand that a “good society” is the key that will open the door to the bonanza of free trade.

References for this article are available here.