Latin Inc
Trade
Calderón fears US special interests
Felipe Calderón has warned that the US is falling short of the pledges on open trade made during the first meeting of the G20 in Washington last year. In an interview with the Financial Times, Mexico's president said that pressure from powerful interests in the US had hindered government policy and, unless overcome, would ensure a much slower recovery. "The administration of President Obama is suffering very, very strong pressure from sectors affected by the US economic recession, and that is preventing it from acting correctly," Mr Calderón said.
Trade Wars: Will Protectionism Win out over Recovery?
The $787 billion stimulus plan that U.S. President Barack Obama signed on February 17 contained a provision that was hardly unexpected but nevertheless worrisome to proponents of global free trade. It was a requirement that projects funded by the bill buy American-made goods whenever possible. When governments around the world spend vast sums to stimulate their economies, it seems only reasonable for each to invest at home. After all -- or so the argument goes -- why should American taxpayers pay for steel from Canada when U.S. steelmakers are struggling? Economists and political leaders in the U.S., Europe and elsewhere worry that this simple logic is spurring protectionist sentiment around the world, threatening free-trade principles that are crucial to any global economic recovery. This comes on top of concerns about the decline in trade from shrinking consumer demand and credit problems caused by the financial crisis. In the U.S., Democrats in the House wrote strong "Buy American" provisions into their economic stimulus bill, though the terms were eased in the Senate at the urging of the Obama administration. The final bill requires use of U.S. iron, steel and manufactured goods in projects funded by the stimulus plan. Exceptions are allowed in the "public interest," or if using U.S materials would increase project costs by 25% or more.
Obama's Plans for Latin America: ISN Security Watch's Sam Logan talks with leading experts to find out how Obama's policy toward Latin America will change relations with the US' southern neighbors
When Barack Obama takes office in 2009, Latin America may see a renewed effort from the White House and State Department to reconnect with the region. Among the numerous concerns for the incoming administration, Latin America will remain a mid- to low-level agenda item, but the Obama team will most certainly engage with Cuba, Mexico and Brazil, significantly changing policy in some cases, according to a number of experts.