IHS Global Insight Daily Analysis

The U.S. Senate yesterday approved a six-week extension of the Andean Trade Preferences and Drug Eradication Act (ATPDEA), a measure that grants Colombia, Peru, and Ecuador trade preferences in return for counter-narcotics co-operation. The lower house last week approved extending the application of the measure—scheduled to expire by the end of the year—until the end of June 2012 (see Colombia: 16 December 2010: ). Such a long extension, however, was not supported in the upper house, where Republican Senator for Alabama Jeff Sessions has been attempting to turn down a provision contained in the same bill that would have given duty-free access to sleeping bags made in Bangladesh, a move that would have hurt a manufacturer in Alabama. Significance: Private-sector lobbies in the Andean region have noted the failure of Congress to approve the 18-month extension with disappointment. The six-week extension that did pass is no more than a stop gap, although it is better than nothing.

In particular, flower exporters in Colombia and Ecuador will continue to benefit from duty-free access to the U.S. market during the crucial period in the run-up to St Valentine's Day on 14 February. Governments and the private sector now hope that a longer extension of the ATPDEA will be passed by the incoming U.S. Congress. In Colombia, the renewed uncertainty linked to domestic politics in the United States will also increase pressure on the government to renew efforts to nudge the U.S. Congress into the long-delayed ratification of a Free-Trade Agreement.You".

Compartir: