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Last Updated: Friday, 1 July, 2005, 07:05 GMT 08:05 UK
US senators back Latin trade pact
Sugar plantation
The US sugar industry fears the deal could spark job losses
A Central American free trade agreement signed a year ago has been approved by the US Senate despite much opposition.

The US textile and sugar industries and US trade unions have opposed the deal.

But President George W Bush insisted it is "good for American workers, good for our farmers and good for small businesses".

Five countries in the region have signed up to Cafta, which will aim to help ease poverty, foster development and strengthen democracy in the region.

"The agreement is also a strong boost for young democracies in our own hemisphere whose success is important for America's national security and for reducing illegal immigration," Bush added.

Weak labour laws

The US Senate voted 54-45 in favour of the trade agreement which will next be considered by the US House of Representatives.

Those in favour say US exports of both agricultural produce and manufactured goods to the region should rise.

Cafta signatories
Costa Rica
El Salvador
Dominican Republic

Yet the US sugar and textile industries fear job losses could result from tough competition from countries where workers' rights are poorly protected.

"There is only one labour provision in Cafta that is enforceable; a nation's commitment to enforce its own laws," said Senator John Kerry.

"That sounds good," he said, "but in reality this provision does nothing to protect workers."

The Bush administration has responded to such criticism by pledging extra funding to help Cafta countries protect workers and the environment.

The participating countries are Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic.

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