This is the Cato Daily Podcast for Wednesday, October 10th, 2007. I'm Caleb Brown. Kafta is approved in principle. on Juan Carlos Idalgo is Project Coordinator for Latin America at the Cato Institute's

Center for Global Liberty and Prosperity.

He says there are reasons to be encouraged by the vote to lower trade barriers across

Central America.

Khafti is a filtray agreement between the United States and six Central American countries and the Dominican Republic.

And it basically liberalizes trade between these countries, abolishing all tariffs in the long run

up to a period of 20 years and establishing new rules

for this relationship, this commercial relationship between these countries.

Costa Rica recently approved KAFTA in principle.

What was surprising about that vote?

Well, it was surprising that given the fact that the United States is the major,

the largest trading partner of Costa Rica, the boat was so close.

We have a long history of trading with the United States.

We are a very successful exporter in the water economy for giving our small size.

So it was surprising that the vote was so close that actually like 48% of the country voted against this agreement, which means that there is a large

segment of the population that remains skeptical about free trade and is very antagonist to the idea of having a close relationship with the United States.

In the positive side, it was very pleasant to find out that the province that actually

deliver KAFTA, deliver the vote to approve KAFTA, was province that

the province of Kartago, which is a small province, but is

mainly agricultural.

And you know that during the debate, opponents of KAFTA kept repeating that

farmers in Costa Rica were going to be the most harmed if KAFTA passed and

...