Central American Trade Deal Is Signed by Bush

President Bush signed a free trade agreement with Central American countries Tuesday, celebrating a victory in Congress so narrow and grueling that it cast doubt on the future of other trade-opening pacts the administration is negotiating.

“Strengthening our economic ties with our democratic neighbors is vital to America’s economic and national security interests,” Bush said at an East Room ceremony in the White House.

Bush’s signature on the Central American Free Trade Agreement capped a bruising political battle.

The deal, which Bush had first approved more than a year ago, passed the House last week by a two-vote margin, obtained only after the president and House Republican leaders cajoled and made side promises to wavering lawmakers.

The agreement -- with Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic -- eliminates tariffs and opens up the region to U.S. goods and services. It also lowers obstacles to investment in the area and strengthens protections for intellectual property.

“CAFTA is more than a trade bill,” said Bush, suggesting national security implications.

He said the agreement would help buttress Central American democracies to help them better defend against “forces that oppose democracy, seek to limit economic freedom and want to drive a wedge between the United States and the rest of the Americas.”

Only 15 Democrats voted for the agreement in the House, a break from the bipartisan support that major trade legislation has received in the past in Republican and Democratic administrations.

The pact was approved by a vote of 54 to 45 in the Senate, which is more favorable to trade agreements.

Critics said the measure would cost U.S. jobs, particularly in the sugar and textile industries, a claim supporters disputed.

The closeness of the 217-215 House vote raised questions about other free trade agreements the Bush administration is negotiating, including ones with Bahrain, Thailand and the Andean countries of South America.

It also cast a cloud over the fate of U.S.-backed trade talks being undertaken by the World Trade Organization to reduce global trade barriers, known as the Doha round.

Early in his first term, Bush talked grandly of a free trade agreement encompassing the Western Hemisphere and another one linking the U.S. with Pacific Rim countries. But the administration now speaks in more modest terms.

Joining Bush at the signing ceremony were congressional sponsors, House and Senate committee leaders and ambassadors from the five Central American countries and the Dominican Republic.

The East Room was packed with guests, and an overflow crowd watched the proceedings on a large-screen television in an adjacent hall.