PERSPECTIVE ON FREE TRADE : Clinton Gives Mexico Little to Quarrel With : The further negotiations he asks cover changes needed to reform a poor country into a modern economy and society.

Two years ago the free trade agreement negotiations that Mexico and the United States were about to embark upon met their first challenge. The negotiations required that the U.S. Congress grant the Administration authorization to negotiate with Mexico (and later with Mexico and Canada), under the so-called “fast-track” provisions of the Omnibus Trade Bill. There was a bitter fight where all sorts of allegations were made: a combination of lies, half truths and lots of rhetoric. That battle was difficult to wage on either side; everything that could be said about the proposed trade agreement and of its impact were suppositions. There was no actual document on which to base a judgment.

Two years later the situation is altogether different. To begin with, the agreement that was finalized a few weeks ago is undoubtedly exceptional. Mexico commits itself to adopt trading rules that only the most industrialized nations abide by. In fact, while the country’s economic strategy a decade ago matched that of the most protectionist nations of the developing world, economic reforms of the past several years have brought Mexico very close to the U.S. economy. Just like the United States, through ongoing economic reform, Mexico is aiming to maintain levels of economic growth high enough to rapidly increase its standard of living.

Though Mexico negotiated with the United States, and not with any one political party, perhaps it was inevitable that the free trade agreement would be thrown into the arena of partisan politics.

Prominent Democrats began to condition the agreement on any number of amendments, while President Bush planned to help his campaign by turning the ceremony where the agreement is to be initialed on Wednesday into a campaign rally. From Mexico’s vantage point, domestic politics is a legitimate game, but the relationship between Mexico and the United States should not be subject to ever-changing electoral tactics. The free trade agreement should be assessed on its own merits.

Gov. Bill Clinton has now publicly acknowledged that the proposed agreement is a good one for the United States. In a speech in North Carolina on the weekend, Clinton stated that no amendments to the agreement would be necessary for him as President to be willing to send it to Congress. He did say that he would need further negotiations on two critical parallel issues with Mexico--labor standards and the environment--as well as on funding for retraining of workers. Mexicans could hardly object to negotiating issues as important as the environment and labor standards. As long as those negotiations do not aim at creating new non-tariff barriers, Mexicans would be the first to welcome proper agreement on these issues.

Mexico’s problem is not one of refusing to negotiate on such issues, but how to finance them. After all, Mexico is still a poor country and addressing costly problems such as the environment constitutes a difficult choice when poverty, for instance, is still overwhelming.

Yet it appears to be quite clear that if Mexico’s government is willing to commit itself to maintain transparent, non-discretionary and non-discriminatory trade policies, it will have to commit itself equally to similar frameworks for the environment and for labor. The free trade agreement represents the last stage of a radical change in Mexico’s economy, below which lies a true intellectual revolution. For those advocating the reforms of the last few years, as well as supporting the free trade agreement, the environment and labor could not be excluded. Indeed, Mexico cannot pretend to have a modern economy and society without improving its current conditions; as elsewhere, Mexico will have to find a way to change.

As Clinton said in his North Carolina speech on free trade with Mexico, we must always remember why we are doing this. Mexico and the United States share an enormous potential together, but are also hindered by a large number of difficulties that are the product of our differences in wealth, history and culture.

No one in either nation can change the fact that we are neighbors, nor can anyone change the other, equally relevant fact, which is that the world economy is changing at the speed of sound. The free trade agreement constitutes a crucial anchor for both nations together to make the best of these two circumstances.

If we compare the U.S.-Mexico border with the only other two cases in the world in which similar disparities in wealth, history and culture come together--South Africa and its neighbors and Israel and its neighbors--we can be relieved to see that we are neither at war nor attempting to do everything possible to damage each other’s interests. At least Mexicans and Americans are trying to do something constructive about our proximity and about our future.