Lawmakers criticize Obama for delay in free-trade pacts

(WASHINGTON) - US President Barack Obama's administration came under bipartisan fire Wednesday in Congress for dragging its feet on implementing three key free-trade pacts, warning of competition from the European Union.

The agreements with Colombia, Panama and South Korea were signed during the administration of Obama's predecessor George W. Bush but were held up as officials moved to address various issues with governments including market access and labor union rights.

"This delay in implementation hurts US credibility around the world, not just economically, but geopolitically as well," Republican Senator Chuck Grassley told Obama's top trade envoy Ron Kirk at a Senate finance committee hearing Wednesday on the administration's 2010 trade policy agenda.

"On top of that, it creates some confusion with respect to the administration's own trade initiatives," he said, also warning that while the agreements were held up, the European Union was moving rapidly to forge pacts with the US trading partners.

"South Korea has already concluded a trade agreement with the European Union, and Colombia has reportedly just done the same. Such erosion to global US competitiveness concerns me," said Grassley, the senior Republican on the Senate panel.

Senator Max Baucus, the panel's Democratic chairman, stressed that the United States "should approve the trade agreements that we have already negotiated and signed."

"We must address the remaining obstacles to these agreements. But we must also recognize the consequences of further delay," he said.

Also noting the EU trade agreement with South Korea as well as Canada's free-trade deal with Colombia, Baucus said, "Once implemented, these agreements will give European and Canadian farmers and businesses a competitive advantage, unless we act."

South Korea is the US's fourth-largest trading partner, Colombia is its largest agricultural market in South America and Panama is a center of global commerce.

The US International Trade Commission estimates that the three free-trade agreements, once implemented, would increase annual US exports of goods alone by about 12 billion dollars.

US Trade Representative Kirk told the hearing that the Obama administration gives "priority" to approval of the free-trade agreements.

Obama said last week that his Democratic administration was working to resolve the outstanding issues with the three nations.

Washington is trying to resolve issues relating to market access for US autos and beef in South Korea, while labor reform and tax transparency matters had to be addressed in Panama, Kirk said.

With Colombia, efforts are being made to strengthen the country's labor code and to address violence against labor union officials to ensure that union rights in that country can be fully and freely exercised, Kirk said.