U.S. Rep on Free-Trade Pacts

As the U.S. Trade Representative, Susan Schwab is the point person on international trade issues at the Bush White House. The 52-year-old ambassador has negotiated free-trade agreements (FTAs) with four key commercial partners of the U.S. since she was named to the position in April 2006. Earlier this month, Schwab and Acting Agriculture Secretary Chuck Conner took U.S. legislators on a fact-finding mission to Colombia as part of the administration's ongoing effort to obtain congressional approval of the FTA with that South American country. Schwab spoke with NEWSWEEK's Joseph Contreras during the two-day visit. Excerpts:

NEWSWEEK: Democratic Party leaders in both houses of the U.S. Congress have expressed serious reservations about the FTA with Colombia in light of continuing violence and human-rights violations there. What are the odds of Congress approving the treaty before President Bush steps down in January 2009?
Susan Schwab:
I am not a betting man. But I have great faith in the American political process, and I ultimately see every one of these free-trade agreements being enacted into law before the end of the term.

Why should Congress approve this particular trade agreement?
By any measure, the administration of President Alvaro Uribe, the Colombian judiciary and local governing structures have made tremendous progress in bringing peace and justice. All of them admit there's a ways to go. [But] there is a compelling case to be made that enacting the trade agreement into law will contribute to that progress in terms of new jobs and investment in this country.

On this trip you have repeatedly described Colombia as a good friend and ally of the United States. Since it shares a border with Venezuela and that country's left-wing president Hugo Chávez is an outspoken foe of Washington, might concerns about regional stability help sell the Colombia FTA on Capitol Hill?
If you want good neighbors you need to be a good neighbor, and Colombia is an unbelievably important ally for us in a region where there are some countries that are certainly not allies of the U.S. Colombia is in a rough neighborhood, [but] it is such a positive story, and the more members of Congress understand it, the more compelling the argument for enhancing bilateral ties.

How concerned are you about the increasingly protectionist mood in the U.S. Congress and among some of the leading presidential candidates in both major political parties?
There are some very disturbing signs of increasing economic isolationism. But I have to place my hopes in the American electorate, that they will be electing individuals who are forward-looking.

Are you upbeat or pessimistic about the outlook for free trade worldwide?
If you take a look around the world, there are over 100 FTAs, regional and bilateral, that are under negotiation as we speak. There are a lot of countries that have figured out that it's in their national economic interest to build these commercial ties.

Does that optimism extend to the Doha Round of talks to promote free trade on a global scale?
The Doha Round is our top trade-policy priority, and it's been a real struggle for us. There are a lot of countries--including some rapidly growing, advanced developing countries--that don't seem to want to make a contribution to a round that is so important for development.

Do some of those reluctant developing countries come from Mercosur, a South American trading bloc that includes Brazil and Argentina?
We have a lot of trade with a number of Mercosur members, [but] I would like to see Mercosur playing a more positive role in the Doha Round than is currently the case.

Earlier this year you finalized an FTA with South Korea that has been portrayed as the trade deal with the greatest potential for the United States since the successful negotiation of the North American Free Trade Agreement in the early 1990s.
South Korea has a $1 trillion economy, and a recently published study says that this FTA would contribute at least $10 billion annually to the U.S. gross domestic product. It's the most significant FTA that's been negotiated by the U.S. in 15 years, and it's very, very important for American agriculture and manufacturing.

The Bush administration has signed FTAs with Chile, Colombia, Panama, Peru, the Dominican Republic and five Central American countries. Has Washington exhausted the possibilities for negotiating new bilateral trade accords in Latin America?
It's definitely not exhausted. There are a couple of countries that have expressed interest in a free-trade agreement. And of course we've got the Caribbean countries, some of which are interested either as a bloc or individually. Unfortunately, we have got a number of countries that are clearly shutting down their economies in many ways, and it's very, very sad for citizens and businesses in those countries.