In the face of US threats to downgrade Ecuador's trading privileges over Edward Snowden, Quito has hit back by waiving its preferential trade rights with Washington.

President Rafael Correa's government on Thursday renounced the Andean Trade Preference Act, citing US "blackmail" over an asylum request by the fugitive former NSA contractor, the Guardian reported.

The small South American nation has enjoyed generous trading circumstances with the US via the ATPA agreement. Initially signed by President George H.W. Bush in December 1991, the APTA allows signatories Ecuador, Bolivia, Colombia and Peru to sell goods to the United States without paying import duties, as an incentive to stop cocaine production.

However, Quito has now accused the US of using the pact for imperialism and interference, after the head of the US Senate Foreign Relations Committee said Wednesday that granting asylum to Snowden could severely damage the preferential trade treatment Ecuadorian products receive.

Sen. Robert Menendez said in a statement:

"If Snowden is granted asylum in Ecuador, I will lead the effort to prevent the renewal of Ecuador's duty-free access under the Generalized System of Preferences."

Ecuador went even further in its defiance, also offering a $23 million donation for human rights training in the US.

It was seen as a retort to recent US criticism of Ecuador's human rights record.

Meanwhile, President Barack Obama struck a seemingly dismissive tone over the Snowden affair on Thursday.

Speaking from Senegal, the president said he would not engage in "wheeling and dealing and trading and a whole host of other issues, simply to get a guy extradited so he can face the justice system here in the United States."

The tone seemed at odds with America's actions in launching an international manhunt for the man who leaked details of two top-secret government data-gathering programs, a manhunt that now involves the governments of China, Ecuador, and Russia.

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