FTA  partner countries were selected for a variety of foreign and economic  policy reasons. Since 2002, the United States Has Pursued Negotiations of 17 FTAs with 47 Countries

In the 5-year period that TPA was granted to the President, from 2002- 2007, the administration pursued negotiations toward 17 FTAs with 47  countries. Six FTAs have  been approved and are in force. This is in addition to the FTAs the United States  already had with Israel and Jordan. 1.) FTAs Pursued Account for Limited Share of U.S. Trade and Investment but Include Diverse Markets for U.S. Exports

Trade with countries for which FTAs were pursued under TPA accounted  for about 16 percent of U.S. trade in 2006 and about 16 percent of U.S.  foreign direct investment in 2005. Of the remaining 84  percent of U.S. trade, 27 percent was with countries for which the U.S. had  an FTA prior to TPA (e.g., Canada and Mexico) and 56 percent was with  countries not pursued under TPA, including the EU, Japan, and China. There are several reasons why the United States has chosen not to pursue  some of the largest trade partners for FTA negotiations. USTR Consulted Extensively with Congressional Staff, but Staff Have Mixed Views about Having a Meaningful Opportunity for Input

Although USTR consulted frequently with Congress, some congressional  staff said that both the nature of the consultations and issues such as  timing of the consultations limited congressional input into FTAs. During negotiations, or before entering into (signing) trade agreements,  the President must:    consult with the House Ways and Means, Senate Finance, other  committees with jurisdiction over legislation involving matters affected by  the trade agreement, and COG, with respect to the nature of the  agreement, how it achieves congressional objectives set forth in TPA, and  the effect the agreement may have on existing laws; report to the House Ways and Means and Senate Finance committees on  any changes to U.S. trade remedy laws that an agreement would require at  least 180 days before entering into the agreement;   notify Congress of intent to enter into the agreement at least 90 days    submit private sector advisory committee reports to Congress within 30  days of notifying Congress of intent to enter into an agreement; and    provide the ITC, at least 90 days before entering into the agreement, with  the details of the agreement and request that ITC conduct an assessment  of the likely economic impact of the agreement; the ITC must then present  this assessment to the President and Congress no later than 90 days after  the President enters into the agreement. 4.) Thus, about two-thirds of USTR’s consultations were  with these four committees. However, slightly more than half of the congressional  committee staff with whom we spoke felt that they did not have any real  input or influence on the trade negotiations. Current reporting by the administration on  the trade advisory committee status does not provide sufficient  transparency, so Congress may be unaware of some committees’ inability  to meet and how statutory representation requirements are achieved. To assure Congress that it is receiving the private sector advisory opinions  that it intended in the Trade Act of 1974, we recommend that the  Secretaries of Agriculture and Labor work with the U.S. Trade  Representative to take the following two actions:    Start the advisory committee rechartering and member appointment  processes with sufficient time to avoid any lapse in the ability to hold  committee meetings, and   Notify Congress if a committee is unable to meet for more than 3 months  due to an expired charter or a delay in the member appointment process. Appendix I: Objectives, Scope, and Methodology

To determine how Trade Promotion Authority (TPA) has been used in  negotiation of free trade agreements (FTA), we reviewed: (1) What FTAs  have been pursued under TPA and why? (2) Overall, what is the economic  significance of these agreements to the United States? (3) What is the  nature of the consultation process for Congress, and how well has it  worked in practice? (4) What is the nature of the consultation process for  trade advisory committees and other stakeholders, and how well has it  worked in practice?
Why GAO Did This Study

Congress granted the President Trade Promotion Authority (TPA) to negotiate agreements, including free trade agreements (FTA) in 2002. TPA stipulated negotiating objectives and procedural steps for the administration, including consulting with Congress and trade advisory committees. TPA lapsed in July 2007 amidst questions about its use. GAO was asked to review: (1) What FTAs have been pursued under TPA and why? (2) Overall, what is the economic significance of these agreements for the United States? (3) What is the nature of the consultation process for Congress and how well has it worked in practice? (4) What is the nature of the consultation process for trade advisory committees, and how well has it worked in practice? GAO interviewed staff of the Office of the U.S. Trade Representative (USTR), the International Trade Commission (ITC), congressional committees with jurisdiction, trade advisory committees, and others, and reviewed USTR documents.

What GAO Found

In the 5-year period thatTPA was granted to the President, from 2002-2007, the United States pursued 17 FTAs with 47 countries for a variety of foreign and economic policy reasons. Six FTAs have been approved and are in force, and negotiations for another 4 FTAs have been concluded. The United States has simultaneously pursued comprehensive, high-standard trade agreements on the bilateral and multilateral levels. Trade with countries for which FTAs were pursued under TPA comprises about 16 percent of U.S. trade and foreign direct investment. Twenty-seven percent of U.S. trade is with countries with FTAs in force prior to TPA (e.g., Canada and Mexico); 56 percent is with countries with which the United States does not have FTAs. The largest U.S. trade partners not pursued under TPA are the European Union, Japan, and China; the rest account for relatively small shares of U.S. trade. USTR held 1,605 consultations with congressional committee staff from August 2002 through April 2007, but satisfaction with the consultations was mixed. About two-thirds of these meetings were with the House and Senate trade and agriculture committees. Almost all the congressional staff GAO contacted viewed the consultations as providing good information, but slightly more than half said that they did not provide opportunities for real input or influence. These staff often said that they were not given sufficient time to provide meaningful input. The trade advisory committee chairs GAO contacted said that USTR and managing agencies consulted with their committees fairly regularly, although process issues at times hindered some from functioning effectively. For example, about half said that the 30-day deadline for reporting on the likely impact of FTAs can be difficult to meet, and the ITC had a similar problem. In addition, adherence to statutory representation requirements is not always transparent. Several committees have not been able to meet while their charters were expired, or members had not been reappointed. However, USTR and managing agencies are not required to report to Congress such lapses in a committee's ability to meet.