DR-CAFTA Agreement Off To Slow Start

Although the US free trade agreement
with six Central American countries is off to a slow start, US trade officials are optimistic it
will continue to move forward “as quickly as possible.” The agreement was scheduled to go into
effect January 1, but at this point, only El Salvador appears to be close to implementing
procedures that will enable it to benefit from the pact. The office of the US Trade Representative
said the US government is “working intensively” with all of the Central American partners but the
agreement will be implemented “on a rolling basis” as countries make sufficient progress to
complete their commitments under the agreement.

The Dominican Republic-Central American Free Trade Agreement (DR-CAFTA) was signed by
President Bush last August, but the governments of each of the participating countries must ratify
it. Participating countries — the Dominican Republic, El Salvador, Guatemala, Honduras and
Nicaragua — constitute a $16 billion market for US goods, making them the second-largest US export
market in Latin America, behind Mexico. Both textile manufacturers and importers expect to expand
that trade significantly. 

January 1, 2006