Not so fast, Costa Rica says of free trade pact

WASHINGTON — The Bush administration’s drive to reach a free trade agreement with five Central American countries suffered a setback Tuesday when Costa Rica balked at U.S. demands and said it needed more time before it would be ready to complete a deal.

U.S. trade officials said efforts would continue to reach agreement with the other four countries. The president of one of those nations, Nicaragua, told reporters that his nation was ready to proceed without Costa Rica.

"One country is dragging its feet," Nicaraguan President Enrique Bolanos told reporters, referring to Costa Rica.

Bolanos said although Costa Rica may decide to stay outside of the pact for a time, it was his view that the rest of the countries should move ahead because "Central America cannot wait for more time. Central America needs to advance rapidly."

Abel Pacheco, the president of Costa Rica, told reporters in San Jose that "we are not in a hurry to close negotiations." He said he expected his country would return to the negotiating table in January.

Trade officials working on the proposed Central American Free Trade Agreement, or CAFTA, worked late into the night Tuesday, trying to resolve issues holding up an agreement.

Carlos Sequeira, chief trade negotiator for Nicaragua, said an agreement was within reach, but he said discussions were continuing in two of the most sensitive areas, agriculture and textiles.

The Bush administration hopes to use a successful free trade deal with Central America to re-energize discussions over a bigger goal — creation of the world’s largest free trade area covering the 34 democracies in the Western Hemisphere. Those talks have snagged over disputes between Brazil and the United States on how comprehensive the free trade agreement should be.

The Central American negotiations have raised concerns among various politically powerful forces in the United States including textile makers, sugar growers and unions.

They fear a free trade deal with the region would subject them to unfair foreign competition. Costa Rica withdrew from the bargaining Tuesday over U.S. demands that it open up various service sectors, including telecommunications and insurance, to foreign competition.