WITHOUT A HUMAN FACE

Oppressive competition without social criteria. Resistance grows against the Regional Free Trade Agreement CAFTA in Central America and the US.

By Markus Plate

[This article published in: Junge Welt, April 27, 2005 is translated from the German on the World Wide Web, http://www.jungewelt.de/2005/04-27/008.php.]




Opposition against the planned Central American Free Trade Agreement (CAFTA) grows in Central America and in the US. Particularly in Guatemala, unions, small farmers-, indigenous- and human rights- organizations call to demonstrations almost daily. After the Guatemalan parliament approved the free trade agreement between Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, the Dominican Republic and the US on March 10, 2005, Guatemala witnessed the greatest wave of protests since the signing of the free trade treaty in 1996. The rightwing liberal government of President Oscar Berger sets out against free trade opponents with uncompromising severity and the deployment of the army. In the middle of March, a street blockade was broken up and a demonstrator was shot dead.

RESERVATIONS IN THE US

Reservations against the agreement are also growing in the US. Powerful interest groups like farmers and unions fear for jobs and agricultural subsidies. Politicians also voice their doubts. After the first hearing in the US Congress in the middle of April, Daniel Britto, a representative of the Democratic Party, declared there would be strong opposition against the agreement. Unlike other bi- and multi-lateral trade agreements, Britto said, both democratic and republican representatives oppose ratification of CAFTA. Particularly in the area of “labor,” the intended regulations do not correspond to international standards as to wages, the right to union organizing and protection against unlawful termination, Britto said.

At the first hearing in the US Congress, the Guatemalan bishop and human rights activist Alvaro Ramazzini journeyed to Washington. He urgently asked the representatives not to approve the agreement. A “human side” is lacking in the drafted agreement. He fears further social polarization of the population and increased violence in his country.

The framework for a CAFTA agreement was already signed by the participating governments in May 2004. Up to now the parliaments in Honduras, Guatemala and El Salvador have approved the agreement. Decision is imminent in Nicaragua, Costa Rica and the Dominican Republic. The free trade agreement should make easier the export of goods and services from the US to Central America and the Caribbean. In the future 80 percent of US exports of consumer- and industrial goods could enter Central American and Caribbean countries duty-free as well as half of all agricultural products. The US government ensures the security of its markets against Asian countries and the European Union (EU).

PRESSURE ON WAGE COSTS

Guatemala’s president Berger pretends to be optimistic. His government promises 50,000 new jobs. Guatemala will “lose all connections” if the country does not join the free trade agreement. Guatemala’s businessmen hope for a positional advantage if they can export to the US duty-free in the future with trifling transportation costs unlike China. The local textile industry sees “the last chance in CAFTA for maintaining a competitive clothing industry” given the competition from China, the chairperson of the textile association, Carla Caballeros, explains. Wage costs in Guatemala are presently “twice as high as Asian competitors.”

A “flexibility of working conditions” was urged at the beginning of the CAFTA negotiations to force down wage costs. The Guatemalan union organization CGTG sees an attack on the rights of employees in a country where the average wage of $100 a month is hardly enough for survival. The general secretary of the CGTG, Rigoberto Morales, criticizes businesses for only raising their competitiveness by lowering wage costs.

DANGER FOR SMALL FARMERS

For a long time four-fifths of Guatemala’s population have lived from small-scale agriculture. The farmers fear the overwhelming competition from the US with the CAFTA agreement. For Daniel Pascual, spokesperson of the small farmer association CNOC, the existence of hundreds of thousands of families are at risk. With CAFTA the import duties will be completely removed. Guatemala’s small farmers will not be able to compete with the heavily subsidized products of the US agricultural industry, Pascual explains.

Negotiations for the free trade agreement were conducted by president Berger and by his predecessor Alfonso Portilio behind closed doors without openness for dialogue. For Ileana Alamilia, chairperson of the journalist association APG, this shows that the 1996 peace treaties that ended a 36-year civil war have “become obsolete.” The rector of the national university of Guatemala city, Luis Alfonso Leal, even condemns the government’s negotiations for the peace treaty as a violation of the constitution whose Article 171 provides for the integration of all social groups in “essential decisions.” Leal will file a complaint against the Guatemalan government on April 1 in the constitutional court, representatively for social organizations.