Dominican Republic-Central America-United States Free Trade Agreement Implementation Act

DOMINICAN REPUBLIC-CENTRAL AMERICA-UNITED STATES FREE TRADE AGREEMENT IMPLEMENTATION ACT -- (Senate - June 30, 2005)

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Mr. CORNYN. Mr. President, I rise today to lend my voice and my support for the Dominican Republic-Central America-United States Free Trade Agreement. CAFTA would be a great benefit to the United States and all countries involved. Momentum continues to build for this important accord which will, notwithstanding what some have said on the floor today, actually grow jobs in the United States and grow jobs in Central America. It will boost opportunities for exporters in the United States and provide additional market access for our products in Central America. Congress should pass this important agreement for the good of both our economy and our national security, as well as those of our neighbors.

Economic growth brought about by free trade and free markets creates new jobs and raises income. This growth lifts people out of poverty, even as it spurs positive economic development. Free trade supports sustainable development and strengthens private property rights while encouraging competition, transparency, regional integration, and the open flow of technology. And a strong world economy based upon free trade and transparency advances not only the prosperity of nations but the cause of peace and liberty around the world.

A vibrant, free market that values innovation and competition is one of the vital components of American success. For consumers here in the United States and the DR-CAFTA countries--Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, and Nicaragua--free-trade will provide real and tangible benefits. It will demonstrate our commitment to the economic prosperity of that region, and it will also encourage the spread of democracy, transparency, and respect for the rule of law.

DR-CAFTA countries are our 12th largest export market, with nearly 44 million consumers. Currently, nearly 80 percent of products from these countries enter the U.S. duty-free, but the average tariff on our goods is between 7 and 9 percent. DR-CAFTA would eliminate this imbalance and provide instead for reciprocal trade between all parties to the agreement--this means the playing field would be leveled for American exporters.

The benefits of this agreement are clear: When CAFTA is implemented, 80 percent of U.S. products will enter DR-CAFTA countries duty-free, with the remaining 20 percent being phased in over 10 years. Currently, the average tariff imposed on U.S. exports to Central America is between 7 and 9 percent--and some farm products being taxed as much as 16 percent.

Key U.S. export sectors stand to significantly benefit from the agreement, including medical and scientific equipment, information technology products, construction equipment, and paper products.

As well, agriculture exports will be allowed to expand: More than half of current U.S. farm exports to Central America will become duty free immediately, including cotton, wheat, soybeans, fruits and vegetables, high-quality cuts of beef, processed food products, and wine. It is estimated that U.S. agriculture producers will increase their exports by $900 million as a result of the DR-CAFTA agreement. Finally, after tariff liberalization has been fully implemented, and all economic adjustments have occurred, overall U.S. welfare is likely to increase in the range of $135.31 million to $248.17 million. As well, the U.S. International Trade Commission has found that the effect of the agreement would be to reduce the overall U.S. trade deficit by $756 million.

Furthermore, over half of current U.S. farm exports to Central America will become duty-free immediately, and other U.S. exports, such as information technology products, agricultural and construction equipment, paper products, chemicals, and medical and scientific equipment will immediately gain duty-free access.

Workers in Central America and the Dominican Republic support the agreement. They recognize that it will help create more and better paying jobs. This in turn will help fight poverty, lifting these workers out of circumstances where they currently survive on only a few dollars a day. Enhanced opportunities for economic growth will provide these governments with additional resources for much-needed health care, education, and basic infrastructure.

By working to alleviate poverty in Central America, we increase the likelihood that would-be immigrants would instead choose to stay and work in their own countries. We have seen the flow of immigrants who flock across our borders--they come here to work hard so they can send money home to support their families and relatives. They may be well-intentioned, but these hard workers are doing little to help the economy of Central Amerixa.

The young democracies of Central America still face resistance from those opposed to the spread of democracy and economic freedom. In supporting DR-CAFTA, the United States will stand alongside those who support these ideals--those who believe in the rule of law, and will demonstrate that America does not merely view Central America as a trading partner, but that we intend to support the continued democratic development of our neighbors.

Congress should promptly pass DR-CAFTA, as agreements that remove unnecessary barriers to free markets are good for America, and it is in our economic and national security interests to support a prosperous Central America. DR-CAFTA will encourage economic prosperity, stability, transparency, and respect for the rule of law throughout the region. I ask that my colleagues join me in supporting this important agreement.

Mr. President, let me focus, in the time I have remaining, on immigration. I heard the Senator from Illinois claim that if we pass CAFTA, it will somehow displace Central American workers and they will be caused to immigrate--illegally, perhaps--to the United States. I could not disagree with him more.

About a year ago, I traveled to Central America to five of the countries involved in this agreement, and in each and every one of those Central American countries we were told that their new democracies' future depends on ratification of these free-trade agreements. To a man, the leaders of those countries asked us to do everything we can to see that this free-trade agreement passes.

While certainly we want to be a friendly neighbor if we can, I would not support this agreement if it weren't in the best interests of the United States on a number of bases. There is one conversation I remember in particular that relates to the comments we just heard from the Senator from Illinois about immigration. In Guatemala, at the Ambassador's residence, a gentleman told me, ``We want to export goods and services, not people.''

Mr. President, that stuck with me because what he was saying is that by our ratifying CAFTA, we create jobs and opportunities for the people of Central America where they live, so they don't have to come to the United States--illegally or otherwise--to be able to support their families. That is one of the reasons I am so strongly for this agreement.

I am also for this agreement because these new democracies, many of which were engaged in civil war not that many years ago--and countries such as Nicaragua, where Daniel Ortega is hoping and praying that we will somehow turn our back on that country and these other new democracies--there are literally people waiting to take advantage of America if we turn our back on these countries, and to claim that instead we should align our interests with people like Fidel Castro, Daniel Ortega, and others.

It is in our best interest to make sure that these new and fragile democracies flourish, that people who live there can also find work there and support their families. The irony is that we hear people argue that unless we have stronger labor provisions or environmental provisions for these agreements--this agreement in Central America--that we somehow should not pass it. The fact is, there are strong labor provisions and environmental provisions in this agreement. But do you know what. The best guarantee for a good environment is democracy. The best guarantee for good labor laws and the rule of law in these countries is democracy.

If we turn our backs on Central America and these countries in this free-trade agreement, critics and enemies of this country will point to us and our actions and our rejection of this agreement and claim victory and say that America was not serious about helping; America does not care about anyone but itself, when in fact the opposite is true.

We know, further, that the avenues used for illegal immigration up from South America, Central America, through Mexico's southern border, through seaports, and in the air are being used by organized criminals who smuggle human beings, who traffic in persons, who smuggle weapons, and who smuggle illegal narcotics. In other words, they are organized criminals who care only about making money, and they don't care one whit about the human suffering that they cause.

It is simply in America's self-interest that we enter into this agreement which provides new markets for our producers in this country. It opens our markets further to those fragile democracies and market economies in Central America. It gives democracy a root in a way that cements our interest and reinforces our national interest, not only in this country, but in this hemisphere in Central and South America, an area that could sorely use the attention after what has been called a period of benign neglect.

I urge my colleagues to vote with me in promptly passing CAFTA as agreements that remove unnecessary barriers to free markets which is in the economic and national security interest of the United States and a prosperous Central America.

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