Peru deal would usher in new path to trade

— -- The House approved a trade deal with Peru Thursday, giving a new boost to U.S. efforts to spur global trade.

Trade between the U.S. and Peru last year amounted to just $8.8 billion — less than 10 days' worth of U.S.-China trade.

The vote was 285-132, a comfortable margin of victory in the House. But it represented the first test of a new approach to trade, hammered out in May between Democratic leaders and the White House, which added labor and environmental safeguards to future treaties.

"It is evident we need to change our trade strategy," said Rep. Doris Matsui, D-Calif., as the debate began Wednesday.

Senate passage of the measure also is expected later this year. Congress is unlikely to consider other pending agreements with Panama, Colombia and South Korea until 2008.

As the vote neared, most attention centered on a split in Democratic ranks between leaders who backed the deal and opponents, including two dozen freshman lawmakers who were elected last year after campaigning against Bush administration trade policies.

"Ultimately, we're saying to Americans: We're sending your jobs overseas," said freshman Rep. Carol Shea-Porter, D-N.H.

If a majority of Democrats vote against the deal, then "that's the end" of approving new trade deals negotiated by the Bush administration, says Lori Wallach of Public Citizen's Global Trade Watch.

Today, 98% of goods imported from Peru enter the USA on a duty-free basis. The pact would eliminate most tariffs on U.S. exports to Peru, including manufactured goods, textiles and farm products. "This is about our access to the market," says William Reinsch, president of the National Foreign Trade Council, a business group.