Ecuador rejects US trade preferences, rattles exporters, in fight over NSA leaker

The escalating struggle over the fate of NSA whistleblower Edward Snowden may have claimed its first victims: tuna, roses, socks and broccoli.

Ecuador announced Thursday that it is unilaterally rejecting U.S. trade benefits on 247 products, and said it will give $23 million a year for human rights programs in the United States.

“Ecuador does not accept pressure or threats from anyone and does not negotiate its principals or submit to commercial pressure — as important as it might be,” Minister of Communications Fernando Alvarado said at a news conference. “Ecuador renounces, unilaterally and irrevocably, those trade preferences.”

Under the Andean Trade Promotion and Drug Eradication Act, or ATPDEA, Ecuadoran goods worth $223 million enter the United States tax free. The deal is up for renewal in July and members of the U.S. Congress had said it might be at risk if Ecuador granted Snowden the political asylum he’s requesting.

But Ecuador beat Congress to the punch.

“They’re threatening to take the trade preferences away because of the Snowden case,” President Rafael Correa told cheering supporters. “Our dignity doesn’t have a price.”

Correa said the long-running trade deal was meant to compensate Andean nations for their efforts in the drug war, but has turned into a tool for “blackmail.”

The trade preferences save exporters about $23 million a year, and Alvarado said the country will send the same amount to the United States to train the country on how to avoid “espionage, torture, extrajudicial killings and other acts that denigrate humanity.”

Ecuador doesn’t have money to spare. The country ran a 2012 budget deficit equivalent to 3 percent of GDP. The United States, by comparison, had a deficit of about 7 percent of GDP.

In a statement, Rep. Ileana Ros-Lehtinen, R-Miami, called the training offer “laughable.”

“This unilateral act is further proof that [Correa] does not want close ties with the United States and only wishes to sabotage our bilateral relationship in order to save face following pressure from our government for Correa to refuse asylum to Edward Snowden,” she said. “I urge the Obama administration to send a clear message to Correa that his ill-considered actions will not go without consequences and reexamine all foreign aid that goes directly to this reckless government.”

The trade announcement has sent a chill through the business community here. The United States is Ecuador’s largest trading partner, buying some $9 billion in goods in 2012.

“We don’t have the luxury to give up a single dollar of trade,” said Felipe Ribadeneira, the executive director of the Federation of Exporters. “This decision worries us greatly.”

Even so, it’s U.S. Congress that unilaterally provides the trade benefits, so goods should keep flowing tax free through July 31, when the deal expires, he said.

Exporters had been lobbying Congress to have goods that benefit from ATPDEA be reclassified under the Generalized System of Preferences. “Unfortunately, I think all the work we did to try to make that happen is now at risk,” Ribadeneira said.

Come August 1, canned tuna will face a 15.6 percent tariff, roses will be slapped with a 6.8 percent tax and broccoli and cauliflower will face a 14.9 percent tariff. But everything — from socks to ceramics — will take a hit, the Federation of Exporters said. But Correa said he would send bills to the Ecuadoran Congress to compensate exporters.

Snowden, 30, has been in a Moscow airport terminal since Monday as he tries to elude capture by U.S. authorities who want him on criminal espionage charges. A former National Security Agency contractor, Snowden has unveiled government programs that intercepted Internet and telephone communications worldwide. Alvarado called those programs a clear violation of international laws.

“We understand that there should be mechanisms to fight terrorism,” he said. “But we cannot allow that to be an excuse to trample human rights and the sovereignty of nations.”

The government also denied reports that Snowden was carrying Ecuadoran identification documents. WikiLeaks had said that Snowden was traveling with Ecuadoran refugee papers after the United States had revoked his passport. But Betty Tola, this country’s political secretary, said any Ecuadoran documents Snowden might be carrying “have no validity whatsoever.” She also said the country cannot begin processing his asylum request until he’s in Ecuadoran territory.

Without legal ID, Snowden may have trouble flying out of Moscow, at least commercially.

Ecuador is the only country that has acknowledged receiving Snowden’s asylum request. But on Wednesday, Venezuelan President Nicolás Maduro said his country would “most likely” give Snowden refuge if he asked for it. Maduro plans to visit Moscow in July, generating speculation that Snowden may try to hitch a ride back on the presidential aircraft.

The Snowden affair has fueled tensions across the globe, particularly with China — where Snowden began revealing his secrets — and Russia, which has said it cannot legally extradite him.

On Thursday, President Barack Obama said he had not called his counterparts, in the interest of not further damaging ties.

“I have not called President Xi personally or President Putin personally,” Obama said at a news conference in Senegal. “I shouldn’t have to. This is something that routinely is dealt with between law enforcement officials in various countries. And this is not exceptional from a legal perspective.”

He also ruled out a military-style extraction for Snowden.

“I’m not going to be scrambling jets to get a [30]-year-old hacker,” he said. “I get why it’s a fascinating story from a press perspective. I’m sure there will be a made-for-TV movie.”

McClatchy Newspapers correspondent Anita Kumar contributed to this report.

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