| SPECIAL
REPORTS: |
|
|
|
TRADE:
U.S. Reaches Pact With Central American
Nations
Emad Mekay
WASHINGTON, (IPS) - The United
States and four Central American
countries reached a so-called free trade
agreement (FTA) on Wednesday, a deal
critics say will cost U.S. jobs and
transfer wealth from the already
impoverished Latin nations to U.S.
corporations.
"Negotiations began last January, and
today we have fulfilled that vision with
a cutting edge, modern FTA designed to
tear down the tariff walls that block
trade between the United States and
Central America, between friends and
neighbours," said U.S. Trade
Representative Robert B. Zoellick.
U.S. partners in the deal are El
Salvador, Guatemala, Honduras and
Nicaragua. Washington plans to include
the Dominican Republic in the FTA in
2004.
Costa Rica, however, withdrew abruptly
from the talks on Tuesday, a setback to
the ambitious U.S. trade agenda. That
country's officials said they still had
concerns over the fate of
telecommunications and insurance
industries, and agricultural and
textiles sectors.
A statement from Zoellick's office
described the CAFTA (Central American
Free Trade Agreement) plan as a step in
the push for "trade liberalisation
hemispherically through the Free Trade
Area of the Americas (FTAA) and globally
in the Doha talks in the World Trade
Organisation (WTO)".
The United States wants to set up a free
trade area in the western hemisphere
that would include all countries except
Cuba. But talks last month in Miami
aimed at advancing the FTAA were only
partially successful, stalling over
Washington's refusal to discuss
subsidies to U.S. farmers, among other
issues.
"Step by step, country by country,
region by region, the United States is
opening markets with top-notch,
comprehensive FTAs that set the
standard," Zoellick said.
Washington already has FTAs with Israel,
Jordan, Singapore, Canada and Mexico,
and is angling for future deals in the
Middle East, southern Africa and Latin
America, among others.
"The United States is committed to
opening markets around the world because
American farmers, workers, consumers and
businesses want to sell our world-class
goods and services," Zoellick added. "CAFTA
will streamline trade."
Even though the draft text of the
agreement will not be released until
January, the deal is known to be
modelled after the North American Free
Trade Agreement (NAFTA) among Mexico,
Canada and the United States.
But some recent research has shown that
NAFTA did not improve the lives of
millions of poor Mexicans and has cost
the jobs of workers in Canada and the
United States.
Last month the Carnegie Endowment for
International Peace, a Washington-based
think-tank, said foreign direct
investment in Mexico led to the creation
of 500,000 manufacturing jobs from 1994
to 2002, but that the country lost at
least 1.3 million jobs in the
agricultural sector alone, where
one-fifth of Mexicans still work.
Activist groups opposed to CAFTA say it
is similarly flawed and would carry
hefty social costs.
Last week, Oxfam America, the American
Federation of Labour-Congress of
Industrial Organisations (AFL-CIO), the
Washington Office on Latin America (WOLA),
World Vision, Health GAP and more than
two dozen U.S. church groups vowed to
fight the trade deal.
Much of their opposition stems from the
United States' history of protecting
U.S. farmers to the detriment of other
nations' agricultural sectors, imposing
its own corporate-backed agenda and
failing to protect the environment,
public health and labour rights in trade
deals it negotiates.
"CAFTA is deeply flawed," said Vicki
Gass of WOLA. "It is not the development
strategy needed in a region where 62
percent of the people live on less than
two dollars a day."
"CAFTA will hurt small farmers, who are
the poorest and most vulnerable people
in the region. After NAFTA was signed,
1.3 million farmers in Mexico lost their
livelihoods. We are concerned that
something similar will happen in Central
America," she added.
Gass also warned that CAFTA could weaken
the burgeoning democracies of the region
by forcing governments into what she
called "economic and policy
straitjackets".
According to the plan, more than 80
percent of U.S. exports of consumer and
industrial goods will become duty-free
in Central America immediately, with
remaining tariffs phased out over 10
years.
Key U.S. export sectors will benefit,
such as information technology goods,
agricultural and construction equipment,
paper products, chemicals and medical
and scientific equipment.
The Central American countries will also
give substantial market access to
services, including in lucrative areas
like telecommunications, express
delivery, computers, tourism, energy,
transportation, construction and
engineering, finances and insurance.
The deal would offer protection and
non-discriminatory treatment to digital
products, such as U.S. software, music,
text and videos, while beefing up
protection for U.S. patents and
trademarks.
Despite the benefits to powerful U.S.
multinational companies, activists are
still hopeful they will be able to beat
the deal in the U.S. Congress, where
some members have already expressed
concerns over labour issues in the deal
and the possible transfer of jobs from
the United States to low-paying markets
in Central America.
Democrats in Congress, which must
approve CAFTA before it comes into
effect, are concerned the deal lacks
provisions to protect workers and the
environment, while some Republicans who
represent areas with substantial
textile, sugar and dairy industries --
to name a few vulnerable sectors -- that
have suffered job losses under previous
trade deals fear even more unemployment.
"People in this country are already
losing their jobs," said Gretchen
Gordon, director of Citizens Trade
Campaign. "We've lost 760,000 jobs to
NAFTA already. In an election year, is
this Congress really going to jeopardise
thousands more actual jobs and job
opportunities by voting for this
agreement?"
The U.S. presidential election is
scheduled for November 2004.
WOLA's Geoff Thale said Costa Rica's
withdrawal could alert more members of
Congress to the deal's weaknesses.
"CAFTA won't have an easy time in the
U.S. Congress," he said. "Costa Rica's
decision not to finish the negotiations,
even under enormous pressure from the
United States, will make it more
difficult to present a bill before the
U.S. Congress in 2004, and (will)
highlights areas of real concern in the
agreement."
Email
this page to a Friend
|
|
|
|
|
