The first round of negotiations leading to a possible bilateral free trade agreement between the Dominican Republic and United States took place yesterday behind closed doors. Trade negotiations are government-to-government dealings, to which the authorities should bring to the table a previously agreed upon position of the private sector. In the Dominican Republic, while the agriculture sector has advanced on reaching a consensus, the industrial sector remains divided. The discussions in the farming sector focus on the special treatment sought for rice, beans, meats, milk, sugar, garlic and onion imports. The strongest opposition to free trade is expected to come from the rice sector. On the other hand, some farming experts say that, looking at the positives, imported rice would reduce the cost of the leading food stable for the population, and the reduction of rice plantations would be a plus for the Dominican environment in many areas, of particular benefit to organic agriculture. The industrial sector is divided on the position the DR should maintain in the talks. The president of the AIRD has even gone so far as to propose that the country postpone the signing of a free trade agreement until 2007, arguing that conditions are currently adverse to competitiveness in this country – high power tariffs, high interest rates, excessive government taxes, etc. The FTA talks have the support of the free zone manufacturing and tourism sectors.
The meetings are taking place at the Hotel Jaragua. Industry & Commerce Minister Sonia Guzman, who is in charge of the negotiations, told the press that “all is going well.” Heading the US delegation is Regina Vargo, Assistant United States Trade Representative for the Americas. Local economists say that the signing of the FTA is a fait accompli, as it is being imposed by the US administration now, in order to dock it to the Central American Free Trade Agreement that needs to go to US Congress now, prior to the US electoral period. FTA advocates say that on the positive side, the DR could gain from the strengthening of its institutions that would come with the signing of the treaty. While, the DR will be required to open up its market – the largest in the Caribbean – the country stands to gain through the imposition by the treaty in terms of improvements in police, environment, justice, government purchasing, and with the elimination of many privileges currently in place to provide artificial bonanzas to some local companies for years. US Trade Representative Robert Zoellick is expected to join in the final day of the first round of talks tomorrow and it is thought he will meet President Hipolito Mejia at the Presidential Palace early tomorrow morning. Mejia returns today from Mexico, where he attended the Special Summit of the Americas organized by the Organization of American States. The US-DR free trade talks are set for three rounds, the first this week in Santo Domingo, a second in Puerto Rico from 9-12 February and a third in Washington from 12-15 March. Regina Vargo will be the guest speaker at the American Chamber of Commerce on Thursday, 15 January at the Hotel Jaragua. During the event, Industry & Commerce Minister Sonia Guzman will be the keynote speaker.