US, Panama nearing agreement on trade deal

“We are pleased that Panama has taken action on labor and tax transparency issues,” USTR spokeswoman Nkenge Harmon told The Hill.

“These are important steps that show the government’s commitment to close cooperation.”

Harmon said U.S. trade officials will soon begin consulting with Congressional leadership on the next steps for the U.S.-Panama trade agreement and the Obama administration’s larger trade agenda. 

U.S. trade officials completed an agreement with South Korea in December and announced a deal with Colombia last week. 

Congressional Republicans and Democrats have urged quick completion of the three trade deals so that they can be sent to Congress and wrapped up sometime this summer. 

House Ways and Means subcommittee on Trade Chairman Kevin Brady (R-Texas) told to The Hill on Thursday that he’d like to see all of the trade agreements arrive on Capitol Hill so they can be completed in quick succession. House Republicans, including Ways and Means Chairman Dave Camp (R-Mich.), are still pressing for a July 1 deadline. 

At least one group, Public Citizen, was livid about the deal, saying politicians in Panama are already discussing a constitutional challenge to the tax agreement in the country’s Supreme Court, according to a Thursday statement.

“The tax agreement ratified yesterday by Panama’s legislature allows the country’s government to refuse a tax information request ‘where the disclosure of the information requested would be contrary to the public policy’ of Panama,” said Todd Tucker, research director of Public Citizen’s Global Trade Watch. “Given Panama’s longstanding public policy of encouraging tax-haven activities, this loophole is big enough to keep its offshore economy alive and kicking.

“We simply have no idea how and if Panama will cooperate with its tax commitments and other longstanding congressional demands for tax haven reforms.”

U.S. Trade Representative Ron Kirk has said once Panama is ready to go, he’ll press for passing elements of a broader trade agenda by asking Congress to reauthorize the Trade Adjustment Assistance program, which helps U.S workers who have lost their jobs because of foreign trade, and the Andean Trade Preferences Act as part of an effort to stop the illegal narcotics trade. Officials also intend to begin talks on lifting trade restrictions with Russia as it seeks to join the World Trade Organization.

The United States and Colombia completed an agreement last week when Colombian President Juan Manuel Santos met with President Obama at the White House and sealed the deal. 

The plan “significantly expands the protections of labor leaders and organizers,” U.S. Trade Representative Ron Kirk said during a conference call with reporters. “It bolsters efforts to punish those who have perpetrated violence against union members and, we think, substantially strengthens their laws and enforcement.”