Charles Rangel, the Democratic representative from Brooklyn, NY, better known as Charlie to his friends, told the press that President George W Bush was employing pressure tactics that he would not use against other important commercial partners. Rangel was referring to the possible exclusion of the Dominican Republic from the Free Trade Agreement between Central America, the United States and the Dominican Republic that is currently awaiting ratification. Rangel’s comments appear in Hoy and the entire situation is also reported in El Caribe, where US Trade Representative Robert Zoellick is portrayed as having started the moves to remove the DR from the DR-CAFTA. Rangel’s comments came on the heels of a letter from Zoellick to Senator Charles Grassley, informing him that the US was negotiating a free trade accord with Guatemala, El Salvador, Honduras and Costa Rica, with no mention made of the Dominican Republic.
In Rangel’s opinion, the Bush administration is trying to force the DR to cave in on the 25% tax to be assessed on imported HFCS (corn syrup) and in the future possibly to be used locally in the production of soft drinks. The HFCS would enter the DR duty-free, but the soft drink or any other product with the syrup as an ingredient would be taxed 25%.
“This was not the just and moral method that a world leader should employ with a friendly country,” said Rangel. He added that if the US has a problem with the tax on soft drinks made with HFCS, they should not exclude the DR from the Free Trade Agreement, but should rather “take the case to the World Trade Organization, just as they did in a similar case with Mexico.” Rangel recalled how in that instance “they did not reject the NAFTA treaty ? they took the case to the WTO.”
Among Zoellick’s strategies to drive the DR to capitulate has been the issue of the treaty’s text to the Central American countries that does not include any of the provisos that were added for the Dominican Republic.
Following this move, Zoellick asked the International Commerce Commission to study the impact of free trade with the Central American countries on the American economy, thereby demonstrating that the US will go forward with the CAFTA without the DR. Grassley, the head of the powerful Senate Finance Committee, and Bill Thomas, the head of the House Ways and Means Committee, said that they were in agreement with Zoellick’s methods and were prepared to proceed with a CAFTA vote next year.
Zoellick did leave a door open for the Dominican Republic, and in his letter he says, “We will continue to work with the Dominican Republic on the issue of the corn syrup in such a way as to permit this government to join the Central American partners and (the US) in a regional agreement.”
El Caribe reports that both President Fernandez and Senate leader Andres Bautista received letters from Grassley on the subject. The US rejected an offer made by President Fernandez that would have reduced the Dominican sugar quota in exchange for keeping the syrup tax intact.