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CAFTA Will Cost Tennessee Jobs, Opponents Say

Jul. 26--Opponents to the Central American Free Trade Agreement said Monday that Tennessee wages and jobs could be lost if the trade pact is passed by the U.S. House of Representatives this week.

"It lowers the margins of the remaining American companies so low that they cannot continue to invest in new plants, new equipment and new technologies. It's a race to the bottom," said Ernest Baynard, executive director of the nonprofit group, Americans for Free Trade.

Mr. Baynard said CAFTA is a sequel to the North American Free Trade Agreement, or NAFTA, which he said cost 1 million U.S. jobs, particularly in manufacturing, textiles and agriculture. He said 20,000 of those lost jobs were in Tennessee.

Last week, U.S. Department of Commerce Deputy Assistant Secretary Walter Bastian dismissed such claims, however, insisting that CAFTA would offer the United States duty-free access to goods made in Central America and the Dominican Republic. Mr. Bastian said NAFTA and other free trade agreements had helped the U.S. economy to continue to grow over the past two decades, nearly tripling Tennessee exports to Canada and Mexico since 1993.

The U.S. Chamber of Commerce, which is pushing for more free trade, estimates CAFTA will generate at least 522 jobs in Tennessee in its first year by boosting the state's exports.