Also, the continuing instability in the international economic system, coupled with lack of political will among the governments has put a question mark on whether the FTAA will come into force by the 2005 deadline, which was proclaimed at the 1994 Summit of the Americas in Miami.
The idea of a hemispheric free trade area was proposed initially by President Bush. The general plan was that it would include all sub-regional trade groups in the region. Hemispheric regionalism would impact on the workings of sub-regional blocs like Mercosur and the Andean Pact.
What further complicates the situation is that hemispheric regionalism would impact differently on different sub regions and would even have varying effects on individual countries of Latin America.
Another fundamental issue is the tremendous difference between the North American economy and that of Latin America. Several sections of the US economy, most notably, the workers, have reservations about the provisions of FTAA. For them, it means loss of jobs as companies from Latin America are allowed to enter the North American markets, and with them workers who are willing to work for much lower wages than their American counterparts.
As it is, illegal immigration is a contentious issue in the American politics. As more companies compete for the same markets, corporate downsizing could increase even further.
Nevertheless, FTAA’s proposals cover almost every facet of economic processes in the region. Its nine negotiating groups deal with intellectual property rights, investment services, competition policy, market access, agriculture, subsidies, anti-dumping, countervailing duties, government procurement, and dispute settlement.
These negotiations through working groups have been opposed by several Mercosur countries. Their approach is based on building upon the existing bilateral and multilateral accords in the region. It also reflects the view that the NAFTA model might be imposed on the FTAA, as opposed to the one that is more in tune with Latin America.