Labor and Tax Issues Key to Panama Agreement

Challenges remain for all three pending trade agreements.

Published on: Mar 12, 2009

House Ways and Means Trade Subcommittee Chairman Sander Levin, D-Mich., says labor and offshore tax issues must be resolved before Congress can consider a stalled free trade agreement with Panama. The Panama agreement was finalized by the Bush administration in late 2006. In a speech to the Washington International Trade Association, Levin promised a far more robust congressional role on trade issues than during the Bush years.

"Panama is a country of small size but an important ally," Levin said. "Right now, 96% of their exports come to the U.S. duty-free, while our exports face significant barriers. An agreement would change that."

Levin said he expected the Obama administration to take a tougher line on enforcing international trade rules, including bringing more cases at the World Trade Organization against countries like China. He said Congress would move enforcement legislation strengthening trade remedy laws against unfair imports, such as products enhanced by export subsidies.

Levin insisted that the United States will continue to lead in the era of international economics and globalization. He said this is not the time to turn inward but that trade is not an end in and of itself. He says he plans to go on fact finding trips to Panama as well as Colombia, with which another free trade agreement is pending in Congress, and hopes to move these deals toward completion. However he is greatly opposed to a third pending agreement with South Korea.

"We made it clear to USTR before they started the negotiations that they had to effectively address the issue of one-way trade with Korea," Levin said. "They failed to do it. And unless that's remedied, the Korea FTA cannot proceed."