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Free trade provokes discussion

Marcela Berrios and Janice Flynn | Friday, September 29, 2006

With the free trade agreements awaiting ratification in Congress and the world watching, Notre Dame has invited scholars and policymakers from around the globe to convene Friday and Saturday to discuss the controversial issue of trade integration in Latin America.

The conference, titled “The Sequencing of Regional Economic Integration: Issues in the Breadth and Depth of Economic Integration in the Americas,” will be held at the Mendoza College of Business, sponsored by Mendoza, the Kellogg Institute for International Studies, The Coca-Cola Company and the Inter-American Development Bank.

In both lecture and discussion formats, the conference will enable scholars and economic specialists to examine the Free Trade Agreement for the Americas (FTAA) and other trade agreements in progress.

Jeffrey Bergstrand – a professor of finance at Notre Dame, Kellogg faculty fellow and organizer of the event – affirmed the goal of the conference is to “ideally, help find guidelines for policymakers for progress in the economic integration that can enhance the economic welfare of members of the societies in the Americas, which will eventually advance the democratization, security, and peace of these nations.”

Currently, the governments of El Salvador, Guatemala and Honduras have approved the Central American Free Trade Agreement (CAFTA), and are awaiting the treaty’s ratification in the United States Congress.

The agreement aims to eliminate trade barriers such as tariffs between the five Central American countries and the United States.

Though many large industries in both countries would immediately benefit from the liberalization of the market, critics have shown concern for the small farmers and entrepreneurs in Latin America who will be unable to compete against subsidized U.S. exports.

In recent months, there have been numerous riots and violent protests against CAFTA throughout Central America, some even resulting in several casualties.

Political science professor and Kellogg fellow Scott Mainwaring agrees that “regional economic integration is one of the most important yet controversial issues regarding the future of economic development for our planet.”

“Advocates claim that economic integration boosts efficiency and will lead to improvements in the standard of living,” he said. “Foes claim that it is bad for the environment, employment, and equity, and that it will not boost economic development.”

Speakers from four different continents, including the former Foreign Commerce Minister of Costa Rica, will address issues such as the benefits and costs that may arise from the globalization process. Other conference participants include prominent academic trade economists, political scientists and policymakers from the International Monetary Fund, Inter-American Development Bank, World Bank and other internationally renowned institutions.

Bergstrand said the intent of the Kellogg Institute is for the conference to promote research in major themes of development and democracy in today’s world. He also said he believes it is important for students to inform themselves of the economic situation affecting both the United States and Latin America.

As such, the conference will include a question and answer session for those unfamiliar with the subject Saturday at 2 p.m. in the Hesburgh Library Auditorium. Also, the $100 fee to attend the conference has been waived to allow Notre Dame faculty and students to participate.