No Free Trade Agreement At Summit

Negotiators debating whether to revitalize talks on a free trade zone spanning the Americas ended their two-day meeting Saturday without an agreement.

Argentine Foreign Minister Rafael Bielsa said the summit's declaration would state two opposing views: one in favor of the proposed Free Trade Area of the Americas, and another that says the topic should wait until after World Trade Organization talks in December.

The decision came after hours of wrangling that delayed the summit's close for eight hours. Almost all of the leaders — including U.S. President George W. Bush — left during the discussions and put high-level negotiators in charge of resolving the prickly subject.

"Predictable as it was, President Bush walked into a political hornets' nest at the Summit and walked out with no agreement, mainly as a consequence of Venezuela's president rallying opposition," says CBS News foreign affairs analyst Pamela Falk. "But, Brazil -- the President's next stop on the trip -- also opposed setting a firm date for trade talks."

The summit was the latest international meeting to fall victim to regional divisions over free trade.

World Trade Organization talks broke down in Seattle in 1999 and in Cancun in 2003. Negotiators trying to set up a Free Trade Area of the Americas in Miami in 2003 also couldn't agree, forcing officials to scale back the ambitious plan to create a free trade zone from Canada to Chile.

On Saturday, Mexico, the United States and 27 other nations wanted to set an April deadline for talks, a proposal opposed by Brazil, Argentina, Uruguay, Paraguay and Venezuela.

In the declaration, the five dissenting countries stated: "The conditions do not exist to attain a hemispheric free trade accord that is balanced and fair with access to markets that is free of subsidies and distorting practices."

The United States says the trade zone would open up new markets for Americans while bringing wealth and jobs to Latin America, but Venezuelan leader Hugo Chavez came to the summit in this seaside resort vowing to "bury FTAA."

CBS News chief White House correspondent John Roberts reports that Chavez has been angry since what he saw as a U.S.-backed attempt to remove him from power in 2002. Since then, he has positioned himself as an effective counterweight to Mr. Bush in this region, spending billions of Venezuela's oil wealth to win friends and influence people.

This week, Chavez threatened to give Venezuela's American-made F-16s to Cuba and China – so they could have a good look inside, Roberts reports.

The last minute haggling at the summit of 34 Latin American and Caribbean nations came after Brazil — a key regional player with Latin America's largest economy — hedged at setting a firm date because it wants to focus for now on ongoing World Trade Organization talks aimed at cutting tariffs around the world and boosting the global economy.

"Anything we do now, before the WTO meeting, could confuse the facts and we'd be creating an impediment to the WTO," Brazilian President Luiz Inacio Lula da Silva told reporters on the sidelines of the summit at Argentina's most renowned summer resort city.

Mar del Plata was calm Saturday after protesters opposed to the FTAA and Mr. Bush's presence clashed in street battles with riot police, burning and ransacking businesses just 10 blocks from the theater where the leaders opened the summit.

But overnight, the violence spread to Buenos Aires, where a U.S.-based bank, a McDonald's and Burger King were targeted by leftist activists bent on causing trouble, Robert reports.

Protests have become commonplace at summits, especially those dealing with free trade and U.S. policies. Friday's violence was on a much smaller scale than massive clashes in 2001 during the Americas Summit in Canada, when police detained 400 people and scores were injured.

The most vocal critic of the FTAA, Chavez declared the deal dead at a peaceful rally Friday attended by more than 20,000 protesters.

"What became obvious at the Summit was that what began with a tense relationship with Venezuela's president has escalated into a problem for the Administration," adds Falk, "with a Chavez proposal to sell arms to adversaries, his threat to divert U.S. oil exports to China and other countries, and rallying support with the poor in the region."

On Saturday, Mexican President Vicente Fox expressed irritation with his Venezuelan counterpart, saying: "This is a personal position of the Venezuelan president."

The Mexican president also denied allegations by Chavez that Washington is trying to strong-arm the region into a free trade agreement.

"No one has ever been forced into a free trade deal," Fox said.

Fox argued that the 29 countries that want to forge ahead should form the trade zone on their own — even though that would leave out Argentina, Brazil, Paraguay, Uruguay and Venezuela and dash hopes of creating a bloc that would eclipse the European Union.

The summit declaration was also expected to address key issues for Latin America — including job creation, immigration and disaster relief for an area that is often devastated by hurricanes and earthquakes.

But the battle over the future of the FTAA dominated the summit, with Chavez saying an anti-FTAA based on socialist ideals should be formed exclusively for Latin America and the Caribbean.

Though there were no immediate signs that protests would re-ignite on Saturday, security remained tight at the summit site, where a huge downtown section of Mar del Plata remained closed by metal barriers and police and soldiers toting semiautomatic weapons.

The violence was front-page news Saturday across Latin America, with dramatic photos of young masked rioters smashing the glass storefronts of at least 30 businesses in Mar del Plata, setting a bank ablaze and battling riot police with slingshots and sharpened sticks.

Sixty four people were arrested, but police reported no deaths or major injuries.

Leftist activists also protested Friday in Uruguay, Venezuela and Brazil — where Mr. Bush is headed for a much-anticipated visit with Silva after the summit ends.

From Argentina, Mr. Bush will fly to Brasilia to stay the night. He will be Silva's guest at a barbecue Sunday before heading to Panama.

Mr. Bush makes this Latin America tour in a weakened political position. His trip comes as he faces the lowest job approval ratings of his presidency back home.

The American president's visit to Brazil is aimed at strengthening relations with Silva, who was distrusted by Washington after becoming the first elected leftist leader of Latin America's largest country in 2003.

But Silva — a former shoeshine boy, grade-school dropout, lathe operator and radical union leader — abandoned his leftist rhetoric and has stabilized Brazil's economy.

Protesters who participated all week in a peaceful "People's Summit" demonstration in a sports complex one 1 mile from the oceanfront hotel where the leaders stayed were gone Saturday, after leaving Mar del Plata in caravans of buses and minivans.

As children skateboarded in a shady park, workers dismantled a tent that hosted a delegation from Cuba, whose communist government was not allowed to participate in the Americas Summit. Argentine security guard Sebastian Lopez, 30, hoped the leaders would denounce the violent protests because they unfairly overshadowed both events.

"What I saw with my eyes all week at the People's Summit was a joyful and peaceful celebration," he said.