January 11, 2005
News Release 05-009
Inv. No. TA-2104-18
Contact: Peg O'Laughlin, 202-205-1819

MEDIA ADVISORY

The U.S. International Trade Commission has terminated its investigation U.S.-Central America Free Trade Agreement: Potential Economywide and Selected Sectoral Effects (Inv. No. TA-2104-18). The public hearing scheduled for January 18, 2005, is canceled.

The Commission took this action following its receipt of a letter from the Office of the U.S. Trade Representative on January 5, 2005, stating that the USTR has withdrawn his request for the assessment.

BACKGROUND:

An FTA was signed by the United States, five Central American countries (Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua), and the Dominican Republic on August 5, 2004. The Trade Act of 2002 requires the ITC to prepare a report that assesses the likely impact of proposed trade agreements on the U.S. economy as a whole and on specific industry sectors and the interests of U.S. consumers. The ITC's report is due to the President and the Congress no more than 90 days after the President signs the agreement, which he can do 90 days after he notifies the Congress of his intent to do so. The Commission issued its report on the U.S.-Central America-Dominican Republic FTA on August 27, 2004.

The ITC instituted the current investigation following receipt of a request from the USTR on November 17, 2004. In that letter, the USTR stated that the Dominican Republic had enacted a tax on beverages sweetened with high fructose corn syrup (HFCS) that the United States regarded as incompatible with the Dominican Republic's obligations under the FTA signed on August 5, 2004. He stated that, as a result of that action, the Administration would take steps to move forward with an FTA with the Central American countries.

The USTR's letter dated January 4, 2005, noted that the Dominican Republic repealed the HFCS tax on December 29, 2004, and accordingly, the USTR was withdrawing his request for the investigation.

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