The Trade Front: Combating Terrorism with Open Markets

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In May 2003 President Bush announced plans to create aU.S.-Middle East free-trade area within a decade. The new tradeinitiative aims to combat terrorism, and the Islamist extremismthat underlies it, by promoting economic and political developmentin the Muslim world. The administration moved quickly to beginputting its plans into action by announcing that the United Statesand Bahrain would soon commence negotiations for a free-tradeagreement (FTA). Meanwhile, negotiations for an FTA with Moroccoare already under way, and a U.S.-Jordan FTA, now in its secondyear, has produced a boom in Jordanian exports.

The Bush administration should be congratulated for opening atrade front in the war on terrorism. With the proper commitment andfollow-through, a major U.S. trade initiative in the Muslim worldcan give real encouragement to desperately needed growth and reformin that troubled region.

The fact is, though, that negotiating FTAs will take time.Relatively few countries in the region are ready to begin serioustalks. Hammering out all the details of a mutually acceptableagreement with those that are prepared to take the plunge-and thenguiding that agreement through approval by Congress-will be acomplex, contentious, and time-consuming process. A U.S.-MiddleEast free-trade area, however desirable, is a policy goal for thelong term. Meanwhile, the administration's initiative fails toinclude Turkey, Afghanistan, or Pakistan-all countries with obviousgeopolitical significance.

Accordingly, the Bush administration should supplement itspursuit of FTAs with an initiative that is simultaneously broaderin scope and capable of generating immediate results. Specifically,the administration should endorse and actively support legislationto grant temporary duty-free, quota-free access to the U.S. marketfor exports of selected Muslim countries. The unilateralelimination of U.S. trade barriers would give tangible, dramaticproof of U.S. commitment to the region, thereby providing ajump-start for the longer, arduous process of negotiating FTAs.

Brink Lindsey

Brink Lindsey is director of the Cato Institute's Center for Trade Policy Studies.