Chile and US agree on accord

WASHINGTON -- Chile and the United States reached an agreement Wednesday for a free trade accord that will allow more than 85 percent of Chilean goods into the country tariff-free in the first year.\nCongress still must approve the agreement, which trade officials said could happen as early as January.\n"This is a partnership for growth, a partnership for creating economic opportunities for both countries," Trade Representative Robert Zoellick said.\nHe said the agreement could serve as a template for other agreements, specifically with Central America, which he said he hopes to pursue at the first of the year.\nWhite House spokesman Ari Fleischer said President Bush was pleased that the "long-sought" agreement had finally been reached -- but made it clear that the White House was nowhere near finished promoting free-trade pacts with South American nations.\n"It's important to America's economy and to the economy of Chile," he said. "This agreement with Chile will mean higher, better-paying jobs for Americans and it's important to our outreach in the hemisphere with our friends and allies."\n"The president looks forward to other initiatives in the hemisphere," Fleischer added.\nIn the fourth year of the agreement, 97 percent of Chile's products will come into the United States tariff-free. By the 12th year, all tariffs will be phased out.\nA National Association of Manufacturers study said that the lack of a trade agreement with Chile costs U.S. exporters $800 million per year in sales and a loss of 10,000 U.S. jobs.\nZoellick said that the U.S. exporters who will benefit include manufacturers of agriculture and construction equipment, automobiles, computers, medical equipment and paper products. More than three quarters of U.S. farm goods will enter Chile tariff-free within four years.\nThe agreement will protect intellectual property rights, labor and the environment, said Zoellick, who did not immediately provide details.\nThe agreement "levels the playing field" for U.S. companies, Zoellick said, citing the example of an American-made Caterpillar tractor.\nChilean President Ricardo Lagos, announcing the agreement earlier in Santiago, noted it was reached after 11 years of negotiations.\n"We started with President Bush the father, and we finished with President Bush the son," Lagos said.\nHe said the agreement "will mean more jobs, more work, more development, more growth for our country."\nEarlier this year, Chile struck free trade accords with the European Union and with South Korea.\nSources in Chile said that the 14th round of bilateral talks in Washington finally solved discrepancies in several key matters, including intellectual property, labor policies, environment protection and mutual market access to agricultural products.\nAnother subject of negotiations was Chile's insistence on controls over the flow of capital, according to Chilean officials.\nThe talks were scheduled to end last Friday, but both parties agreed to extend them. Lagos sent Foreign Minister Soledad Alvear and Finance Minister Nicolas Eyzaguirre to Washington over the weekend to reinforce the Chilean negotiating team.\nChile's main exports to the United States include copper, cellulose, fruits and salmon and other fisheries products. Imports include automobiles, machinery and electronics.\nBilateral trade between the countries currently stands at $6 billion a year, and a free trade agreement could increase that figure by one-third in five years, Chilean experts say.