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Last Updated: Thursday, 28 July 2005, 06:51 GMT 07:51 UK
Latin trade pact wins US backing
President George W Bush
President Bush has pushed hard for agreement on Cafta
The US House of Representatives has narrowly approved the controversial Central American Free Trade Agreement, bringing the pact a step closer to law.

Cafta will lower trade barriers between the US and six Central American countries, with the aim of fostering prosperity and democracy in the region.

The House voted 217 to 215 in favour of the pact, despite opposition from Democrats and a number of Republicans.

President Bush welcomed the decision, which he said would boost US business.

US Senators last month voted in favour of the agreement, which now goes to the President for his signature before becoming law.

Job fears

The free trade pact brings together the US and Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and the Dominican Republic.

"Cafta helps ensure that free trade is fair trade," President Bush said in statement following the vote by Representatives.

"By lowering trade barriers to American goods in Central American markets to a level now enjoyed by their goods in the US, this agreement will level the playing field and help American workers, farmers and small businesses."

However, opposition to the deal had remained strong ahead of the vote.

Several senior White House aides, including Vice President Dick Cheney and Secretary of State Condolezza Rice, were drafted in shortly before the vote to help shore-up support in the Republican-controlled House of Representatives.

Democrats were overwhelmingly opposed to the agreement, but 27 Republicans also voted against it.

US textile and sugar industries and trade unions had opposed the deal, arguing heavy job losses in the US could result because of competition from countries where workers' rights are poorly protected.

But supporters said Cafta would eventually eliminate tariffs currently imposed on US sales in Central America.

"We cannot claim to be fighting for American jobs and yet turn our backs on 44 million new customers in Central America," said Republican Representative Kevin Brady of Texas.

Along with the six new nations within Cafta - and the Nafta agreement with Canada and Mexico - the US currently has free trade agreements with Australia, Chile, Singapore, Jordan and Israel.

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