Guatemala approves CAFTA
Guatemala has approved legislation to implement the U.S.-Dominican Republic Central America Free Trade Agreement (CAFTA). It is the third country after El Salvador and Honduras to do so.
Guatemala also repealed a law that contravened a key obligation regarding the intellectual property of pharmaceuticals.
Kevin M. Burke, president and chief executive officer of the American Apparel & Footwear Association (AAFA), said that Guatemala's endorsement of CAFTA was 'welcome news. This action paves the way for consideration (of CAFTA) in the U.S. Congress. It is absolutely imperative that we secure swift approval and seamless implementation of this agreement to ensure that U.S. textile and apparel companies operating in this country and in partnership with Central American companies can remain competitive.
'As we are already seeing with preliminary trade data from Asia, the new trading dynamics of a quota-free environment have put tremendous pressure on U.S.-Central American supply chains that the current one-way unilateral preference program is simply not able to withstand,' Burke said in a statement.
CAFTA will take a one-way trade preference program 'and make it permanent, flexible and reciprocal, helping U.S. companies diversify sourcing away from Asia,' he explained.
The U.S. Congress could approve CAFTA by the beginning of summer, Linda Menghetti, vice president of the Emergency Committee for American Trade in Washington, D.C., told a Guatemala trade conference in New York on Thursday. 'I am confident of that but not complacent,' she said, 'because opponents of CAFTA will make their voices heard.'
Guillermo Castillo, Guatemala's ambassador to the United States, told the group that 'speed-to-market is the major advantage our region has over the Orient.'