BRITAIN TO BE SIZED UP FOR NAFTA ENTRY

by Charlotte Denny
Wednesday March 15, 2000

A team of Washington officials is due to arrive in the UK today to size up
the British economy for possible membership of the North American Free Trade
Area.
Joining the multi-billion-dollar free trade zone which encompasses Canada,
the US and Mexico would almost certainly require Britain to leave the
European Union and the government has ruled it out as an option. Last month,
Keith Vaz, the minister for Europe, described the proposals as
"far-fetched".

But the inquiry is proceeding at the request of the American senate, where
influential members believe there may be advantages for the US if Britain,
the world’s fourth-largest economy, were to become part of Nafta.

The team, from the International Trade Commission, an independent federal
agency, will meet officials from the cabinet office and the foreign office
as well as the TUC and CBI.

Michael Fabricant, the Conservative MP who has tabled two private members
bills on the costs and benefits of Nafta versus the EU, said it was a
"tempting" alternative.

"I think our economic interests lie more with the United States than with
the EU," he added.

Mr Fabricant said the government ought to set up a royal commission to
investigate the costs and benefits of Nafta in parallel with the US
investigation.

Members of the pro-European Britain in Europe lobby group said joining Nafta
would be against Britain’s interests. "Leaving the EU is the real agenda of
those who propose joining Nafta," said Kitty Ussher, chief economist at
Britain in Europe. "But to do that would be cutting our economic nose off to
spite our political face. We do 53% of our trade with the EU and only 17%
with Nafta."

The ITC will present its report to the US senate in the autumn. Although
individual senate members, such as Phil Gramm of Texas, a leading member of
the senate finance committee, back British membership, the proposal has
failed to attract any enthusiasm from the White House and an invitation to
join is not thought to be on the cards.