By IPS Correspondents
MEXICO CITY, Jan 4 2008 (IPS)

The elimination of all barriers to imported maize under the North American Free Trade Agreement (NAFTA) will ruin Mexico’s rural areas, according to activists and small farmers who are demanding that the measure be revoked. But the free market which opened on Jan. 1 has in fact been in effect for the past nine years.

Canada, Mexico and the United States agreed in 1994, when NAFTA came into force, that the final stage of the gradual freeing up of the region’s agricultural markets would take place in 2008, with the removal of tariffs and quotas for maize and beans – staple foods in Mexico – as well as sugar and powdered milk.

Calling Jan. 1, 2008 "a dire day for agricultural trade is an error or a trick," because the government has been authorising tariff-free imports of maize on a yearly basis since 1996, to cover the shortfall in local production, trade consultant Luis de la Calle told IPS.

If any harm has arisen from opening the market for maize, it has already happened and there will be no difference now that the tariffs have formally been eliminated, along with the need for authorisation before importing, said de la Calle, who was deputy minister of trade negotiations for Mexico during the administrations of Presidents Ernesto Zedillo (1994-2000) and Vicente Fox (2000-2006).

Some 200 opponents of NAFTA, who blame the free trade treaty for most of the ills that plague Mexico’s farming sector, closed one of the 15 border crossings into the U.S. intermittently on Tuesday. On Wednesday a similar number demonstrated outside the U.S. embassy in Mexico City.

Miguel Colunga, leader of the National Campaign in Defence of Food Sovereignty and the Revitalisation of Rural Mexico, told IPS that the 300 social and campesino (small farmer) organisations that make up the campaign will not rest until the agricultural chapter of NAFTA is renegotiated.

The campaigners, whose banner is "Sin maíz no hay país, sin frijol tampoco ¡Pon a México en tu boca!" (roughly: No maize means no Mexico, and so does no beans: Eat Mexican!), want the Mexican border closed to trade in maize and beans until the country has become competitive.

Freedom to import should only be allowed if local production cannot meet domestic demand, they insist.

"Our group is growing, and there is a good climate to press for renegotiation," said Colunga, after announcing that a number of campesino and social associations will mount a "huge" march in the Mexican capital on Jan. 31 to further their demands.

He also said that lawmakers have promised to issue a document defining their position in favour of urging the government to renegotiate NAFTA. Contacts have already been made with the authorities to arrange talks on the subject, he said.

But trade experts like de la Calle and lawyers who specialise in agricultural matters believe that renegotiations of the free trade agreement are unlikely.

The dismantling of tariff structures agreed by NAFTA has been carried out chapter by chapter, and all that remains is to eliminate restrictions on free trade in used cars, in January 2009.

The North American trade instrument does not include a commitment to do away with farm subsidies, an area in which the U.S. is a world champion.

The government of conservative Mexican President Felipe Calderón has announced that it is not in favour of renegotiating NAFTA, and in any case will help the campesinos with more programmes and resources to enable them to face the competition from abroad.

When NAFTA terms were agreed, the government of former President Carlos Salinas (1988-1994) was sure that there would be enough time to prepare the agricultural sector for full market opening in 2008.

But this was not so. "In fact, the governments left campesinos to their own devices and made cuts in all the support mechanisms, and emigration to the U.S. and to the cities increased," Colunga said.

Colunga, who raises sorghum on his 10-hectare property in the state of Chihuahua in northern Mexico, says he has had to make an enormous effort every year to avoid going bankrupt.

Twenty million people out of a total Mexican population of 109 million live in the rural areas, and 75 percent of them are poor. Barely one-third of rural labourers have employment benefits, and there is a steady flow of migrants towards Mexican cities and the United States.

Of the country’s 31 million hectares of cultivated land, less than one million produce crops for export. The rest is used to grow food largely for subsistence, with the surplus being sold on the domestic market.

In terms of overall farm productivity, Mexico cannot compete with the United States. However, it is the main exporter of certain products like tomatoes, lettuce, broccoli, avocadoes and mangoes to its northern neighbour.

Maize was originally domesticated in Mexico some 9,000 years ago and is still the staple food in the local diet. Mexico produces 19 million tonnes a year, compared to 300 million tonnes a year grown in the United States.

For a Mexican farmer, the cost of growing a hectare of maize is 300 times higher, and the yield 3.5 times lower, than for a farmer in the U.S., according to the non-governmental National Campesino Federation (CNC).

Every farmer in the U.S. is subsidised to the tune of an average 20,000 dollars a year, while in Mexico government subsidies are no more than an annual 770 dollars per farmer, the CNC says.

In the U.S., 32 million hectares are devoted to maize, used for human and animal consumption, and also to produce ethanol, a biofuel. In Mexico maize is grown on 8.5 million hectares.

A study by the Organisation for Economic Cooperation and Development (OECD), to which Mexico and the world’s most powerful economies belong, says that state support for Mexican agriculture during the years NAFTA has been in force was too low, and was distributed mainly in the rich northern states.

Total support for the Mexican agricultural sector between 1991 and 1993 was estimated at 3.3 billion dollars. For the period 2003-2005 it was higher, at seven billion dollars.

However, this was a nominal increase rather than a raise in real terms, says the OECD in its study Agricultural and Fisheries Policies in Mexico.

As a percentage of gross domestic product (GDP), government support for Mexico’s rural areas tumbled from three percent of GDP in the 1991-1993 period to 0.9 percent in 2003-2005, the OECD report says.

Although most organisations that oppose free trade in farm products attribute Mexico’s agricultural and livestock problems to NAFTA, studies by the Economic Commission for Latin America and the Caribbean (ECLAC) claim that backwardness in the rural sector is due to a number of factors, such as lack of state support, migration and climate problems.

Colunga said that unlike some of his fellow-campaigners, he does not think that NAFTA is the cause of all the country’s rural problems.

"The problems we have in Mexico’s rural areas date from the 1980s, before NAFTA, when our governments turned their backs on farming. Then during the opening of the markets they didn’t do their job in terms of supporting us, and that’s how we’ve got to where we are," he said.

The Calderón administration says that the liberalisation of the market should not be seen only as a threat but also as an opportunity, because just as Mexico has eliminated its agricultural trade barriers, so have Canada and the United States.

Excerpt:

By IPS Correspondents
MEXICO CITY, Dec 19 2007 (IPS)

On Jan. 1, the Mexican market will be thrown wide open to imports of maize, beans, powdered milk and sugar from the United States, completing a process that began 14 years ago, in which its impoverished rural sector must compete with a powerful and heavily subsidised foreign rival.

The freeing up of Mexico’s agricultural markets has been happening gradually since 1994, when the North American Free Trade Agreement (NAFTA) between Canada, Mexico and the United States came into effect.

The date agreed for the final stage of this process was 2008. It was expected that by then Mexico would be able to cope with the removal of quotas and tariffs for imported maize and beans, the staple foods of most people in this country and an important part of their ancestral traditions.

However, with just a few days to go before the last trade barriers are dismantled, there is obvious asymmetry between the markets, especially with that of the United States, with which Mexico does 90 percent of its trade.

Maize originated in Mexico, which produces 19 million tonnes a year, compared to 300 million tonnes a year grown in the United States.

For a Mexican farmer, the cost of growing a hectare of maize is 300 times higher, and the yield 3.5 times lower, than for a farmer in the U.S., according to the non-governmental National Campesino (small farmer) Federation (CNC).

But every farmer in the U.S. is subsidised to the tune of an average 20,000 dollars a year, while in Mexico government subsidies are no more than an annual 770 dollars per farmer, the CNC says.

In the U.S., 32 million hectares are devoted to maize, used for human food and animal feed, and also to produce ethanol, a biofuel. In Mexico maize is grown on 8.5 million hectares.

"The claws of free trade will grab us by the throat in 2008 and strangle us, and the government is doing nothing about it. It just says it has to fulfil its pledge, but that will be at the expense of poor farmers who can’t compete," Mariano Sánchez, a medium-sized bean grower in Mexico state, near the capital, told IPS.

In actual fact, NAFTA is not so much a free trade treaty as an agreement to eliminate tariff barriers. Dismantling domestic subsidies is an issue that continues to be negotiated at the World Trade Organisation (WTO), where talks are blocked because of the refusal of rich nations to stop subsidising their farmers.

"The farming sector in Mexico was never ready for NAFTA and is still not ready, in spite of all the support the authorities say they have given," said Sánchez, who produces beans on 15 hectares of land, and sells them to local markets. He says he has steady buyers, but fears he will lose them if lower priced imported beans become available.

Twenty million people out of a total Mexican population of 109 million live in the countryside, and 75 percent of them are poor. Barely one-third of agricultural labourers have employment benefits, and there is constant migration of the work force towards Mexican cities and the United States.

Of the country’s 31 million hectares of cultivated land, less than one million produce crops for export. The rest is used to grow food largely for subsistence, with the surplus being sold on the domestic market.

Even so, more than 50 percent of the cucumber and 90 percent of lemons and mangoes consumed in the U.S. come from Mexico.

One out of six watermelons, one-quarter of melons and asparagus and one-third of the tomatoes bought by consumers in the U.S. are also from Mexico, according to government figures.

About 50 campesino organisations and groups of activists opposed to free trade have joined forces in the National Campaign in Defence of Food Sovereignty and the Revitalisation of Rural Mexico, under the banner "Sin maíz no hay país, sin frijol tampoco" (roughly: no maize means no Mexico, and so does no beans).

They have carried out a number of actions aimed at stopping the opening of the market for these essential agricultural products, so far without success.

Over 1,100 agricultural products from the U.S. and Canada can already be imported duty-free into Mexico, and the same is true of the vast majority of Mexican products sold to those countries.

Nearly all quotas and tariffs have been removed. All that remain are the protective barriers for the most sensitive products – maize, beans, powdered milk and sugar – which were left until last.

The government of conservative President Felipe Calderón says that Jan. 1 will not in any way be a dire day for Mexico.

Mexico already imports increasing amounts of maize and beans from the U.S., because it ceased to be self-sufficient in both products almost a decade ago. Therefore the regional open market is already a fact, some observers say.

The elimination of Mexico’s tariff barriers for maize is due to occur at a time when there is high international demand and high world prices for the commodity. Experts say that Mexicans will have no difficulty selling their maize, locally or for export.

Mexico produces an annual surplus of 200,000 tonnes of sugar, and the imminent change in trade rules is not expected to have a major impact on this sector.

The U.S. imports sugar, and could buy it from Mexico, says governing National Action Party (PAN) lawmaker Francisco Domínguez, an agricultural expert.

The local dairy industry, however, cannot fully satisfy local demand, and is at a technological disadvantage compared to producers in the U.S., so it could face stiff competition.

Marco Ramos, an agricultural researcher at the National Autonomous University of Mexico (UNAM), says that all Mexico’s rural problems should not be blamed "on NAFTA and free trade."

"That’s an overly simplistic view that leaves out hard data indicating that failure in the rural sector is due to several causes," he said.

A study published in 2005 by Braulio Serna, of the local office of the Economic Commission for Latin America and the Caribbean (ECLAC), says that NAFTA has not had a quantitatively significant impact on Mexico’s rural sector.

Analyses claiming that opening the market has been the determining factor in Mexican agricultural performance are biased, according to Serna.

The problems of the rural sector, poverty and migration are more directly linked to misguided public policies, global and national economic crises, climatic factors, low levels of technical training among farmers, and the low international commodity prices seen until a few years ago, among other things, the ECLAC expert said.

Government support for the Mexican countryside has increased in the past few years and comprises subsidies, technical support, preferential prices and investment in rural infrastructure.

This year, government spending amounted to some 16 billion dollars, 1.5 billion dollars more than in 2006. And in 2008 funding for rural areas is expected to reach 19 billion dollars.

However, most of the rural areas remain in poverty and overall production has not improved, although there are some successful export sectors.

The backing given by the Mexican state to its farmers does not match the 22 billion dollars that the U.S. gives its producers in direct subsidies alone, without taking into account the substantial additional aid they receive for marketing, technology and infrastructure.

NAFTA opponents organising the National Campaign in Defence of Food Sovereignty complained that, from January, "campesinos will have to defend themselves on their own against U.S. products which are subsidised at a level 30 times higher than the average amounts granted by the Mexican government."

"The ingenuousness, incompetence and collusion of the federal government and many legislators have prevented them from discerning that, hidden behind this new stage of the trade agreement, a true war is being waged against our survival as an independent country," the members of the National Campaign said in an open letter released on Dec. 10.

Delegates from the groups involved in the campaign went on a four-day hunger strike in mid-December, calling for a renegotiation of NAFTA, and announced that they would blockade border crossings to the U.S. from Jan. 1 if their demands are not addressed.

"The campaign against open markets will not change the situation. The best thing to do is to put regrets aside, and look within to find out what can be done so that rural areas in Mexico can develop," said Ramos.

Excerpt:

By IPS Correspondents
KINGSTON, Aug 17 2005 (IPS)

Recent developments in international trade highlight the difficulties facing the 15-member Caribbean Community (Caricom) as it prepares for a key World Trade Organisation (WTO) ministerial meeting in Hong Kong this December.

The continued floundering of the Free Trade Area of the Americas (FTAA), coupled with the United States’ recent passage of the Central American Free Trade Agreement (CAFTA) and ongoing concerns about the European Union’s banana and sugar pricing regimes are some of the major challenges facing this grouping of small developing countries.

The FTAA would unite the economies of the Americas (except Cuba) into a single free trade area, while CAFTA lifts barriers between the United States and Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua and the Dominican Republic.

Negotiations on the FTAA were supposed to have been completed by Jan. 1 this year, but disputes over intellectual property rights and farm subsidies, combined with vehement opposition from civil society groups throughout the hemisphere, have stalled consensus.

The contentious issue of subsidies by developed countries is likely to be high on the agenda at the Hong Kong meeting, as well.

“In Hong Kong, what we need to do is to press for defensive and offensive objectives,” said Richard Bernal, the head of Caricom’s Regional Negotiating Machinery. “On the defensive end, we want to keep the preferences as long as possible and get special and differential treatment.”

“On the offensive side, we want to be sure that the goods and services we can produce competitively now and in the future, that we secure the best possible terms and conditions for those.”

Bernal acknowledged the pessimism many feel about the upcoming WTO meeting, but believes there is room for hope.

“Remember that each round of trade liberalisation gets more difficult because you have done the easier things before, and you are now into areas which are very sensitive or very complex,” he said.

“You shouldn’t be discouraged by the fact that this is taking longer than was anticipated when the Doha developmental agenda was decided on. These things take a while – for example, the last round of negotiations went for nearly 10 years but it produced a useful result, so while the outlook for the Hong Kong ministerial is not very encouraging, we shouldn’t lose confidence in the process,” he said.

“It simply means that it will go on longer than we expected, but it is better to take the extra time to ensure that we get a good agreement, rather than get any agreement by a particular date.”

In the meantime, Caricom is continuing to lobby for favourable treatment for its exports to the EU, and charting the best way to proceed in the absence of progress on the FTAA.

This need for simultaneous engagement in critical negotiations has always been a challenge for the resource-strapped countries of Caricom. It is compounded by the fact that many believe the FTAA is now dead in the water, increasing the focus on negotiating new bilateral deals.

Regional trade consultant Rosalea Hamilton says it is important to determine the extent to which United States trade agreements such as CAFTA will create special conditions of market access that exclude Caricom countries.

“The question for all countries that are not part of these special arrangements, including Caricom, is whether those special terms will negatively impact our trade relations with the U.S.,” she said, noting the “the experience of NAFTA with respect to textile and clothing is a case in point”.

NAFTA, the predecessor to deals like CAFTA and the FTAA, groups Canada, the United States and Mexico.

“We saw very actively the flight of a lot of (manufacturing) activity into Mexico because of that arrangement, so it begs those questions,” she told Radio Jamaica.

Bernal says that while the new CAFTA agreement will not in itself place Caricom at a significant disadvantage, the controversy surrounding the agreement in the U.S. Congress was cause for concern.

“The agreement passed by just two votesàif an agreement that involves such a minute share of U.S. trade had such a difficult passage, what would be the prospects of an agreement that involves a substantial amount of U.S. trade, such as the Free Trade Area of the Americas, if and when those negotiations are completed, or the WTO Doha development agenda?” he asked.

Caricom is already involved in several bilateral agreements with countries like Colombia, Venezuela, Costa Rica, the Dominican Republic and Cuba, and is preparing for negotiations for an enhanced bilateral agreement with Canada, and the South American trade bloc Mercosur, he notes.

Although the possibility of a bilateral agreement between Caricom and the United States is being mooted now in the region, there has been no decision at the level of the heads of government in the Caribbean.

Bilateral arrangements have advantages and disadvantages that wider, multilateral agreements like the FTAA do not have, says University of the West Indies lecturer Patsy Lewis.

“Bilateral arrangements tend to zero in on areas of specific interest to the people negotiating, so if the U.S. is interested in getting access to a particular sector of the economy, they’re in a stronger position to do so,” Lewis told IPS.

“On the positive side, they may be more willing to offer you concessions on a bilateral level than they’re willing to do on a multilateral level or a broader regional level,” she added.

Whatever course of action is taken, it is important that a decisions be taken soon, says Rosalea Hamilton.

“At the last Caricom heads of government meeting, the heads decided that we ought to study having a bilateral arrangement with the U.S., so already the question is ‘what would such a bilateral arrangement look like?’. Part of my concern, my anxiety, is that we’re moving much too slow,” she said.

“It’s not clear whether we are truly ready as a region, (or) as individual countries to take on this challenge, and my fear is if we don’t wake up very quickly we’re going to be overwhelmed,” Hamilton warned.

Excerpt:

By Jim Lobe
WASHINGTON, Mar 14 2005 (IPS)

To consolidate North American integration, the region’s leaders must reverse the growing development gap between Canada and the United States on the one hand, and Mexico on the other, according to a "Chairmen’s Statement" by an influential task force released here Monday.

The Statement, which was issued by the New York-based Council on Foreign Relations (CFR), also calls for the establishment of a North American Advisory Council (NAAC) that will prepare and monitor moves to further integrate the region over the next five years, including the holding of annual summit meetings between leaders of the three nations.

"To build on the advances of the past decade and to craft an agenda for the future, we propose the creation by 2010 of a community to enhance security, prosperity, and opportunity for all North Americans," the Statement, which was signed by the three task force co-chairs, declared.

"The boundaries of the community would be defined by a common external tariff and an outer security perimeter. Within this area, the movement of people and products would be legal, orderly, and safe," it asserted.

The task force’s three co-chairmen – former Canadian Deputy Prime Minister and Minister of Finance John P. Manley, former Mexican Finance Minister Pedro Aspe, and former Massachusetts Gov. William Weld – signed the statement as heads of the Independent Task Force on the Future of North America of the CFR in association with the Consejo Mexicano de Asuntos Internacionales and the Canadian Council of Chief Executives.

The 12-page Statement was released in advance of the next tri-national summit to take place Mar. 23 in Texas where U.S. President George W. Bush, Canadian Prime Minister Paul Martin, and Mexican President Vicente Fox are expected to review recent progress made under the 1993 North American Free Trade Agreement (NAFTA) and consider next steps.

Lauded by free trade advocates, NAFTA’s numerous critics say it has launched a race-to-the-bottom in wages, undermined democratic control of domestic policy-making and threatened health and environmental standards.

But despite the explosive growth in trade and investment among the three NAFTA countries over the past 12 years, North American affairs have generally been gotten surprising little attention from the Bush administration which has been far more focused since the Sep. 11, 2001, attacks on New York and the Pentagon on the "war on terror", the Middle East, and relations with Europe.

Mexico’s Fox has been particularly disappointed by Bush’s lack of interest. Fox had been hoping for a major breakthrough on immigration that would have made it easier for Mexicans to enter the U.S. and to remain there to work when the 9/11 attacks took place, but since then immigration reform has been put on the back burner, while the political climate inside the U.S. has generally become more hostile to immigration.

Indeed, Bush’s failure to deliver substantial immigration reform is often cited as one of the major causes for the steady decline in the public standing of Fox and his PAN party. Many analysts here now believe that the 2006 presidential elections will be won by the PRD, Mexico’s most left-wing mainstream party and one that has been most sceptical about the benefits of NAFTA and North American integration.

Ties between the U.S. and Canada have also become somewhat more strained, largely due to overwhelming opposition by Washington’s northern neighbours to its 2003 invasion of Iraq and the Bush administration’s antagonism toward the UN and multilateralism in general.

Indeed, Canadian public opinion has become so disenchanted with Washington that Martin, who was seen as more pro-U.S. than his predecessor, Jean Chretien, was forced earlier this month to withdraw from Bush administration’s plans to build a missile defence shield for both countries.

None of these developments alters the fact that the economies of all three nations have become increasingly integrated. U.S. trade with its North American neighbours is much greater than its trade with the European Union (EU), Japan and China combined, while Canada and Mexico are now the two largest exporters of oil to the United States.

All three nations are now "liberal democracies, committed to protecting individual rights, upholding the rule of law, ensuring equality of opportunity for our citizens, and achieving a reasonable balance between the market and the state."

Further integration thus promises "enormous benefits" to citizens of the three countries, according to the report, which warns, however, that "these benefits are neither inevitable nor irreversible."

The three countries face three common challenges, including security threats from terrorists and criminal activity; threats to the region’s trade competitiveness as a result of global competition from China to India and expanded EU membership; and the widening of the "development gap" between the two northern members and Mexico.

"Low wages and lack of economic opportunity in parts of Mexico stimulate undocumented immigration and contribute to human suffering, which sometimes translates into criminality and violence", according to the report.

"AS A MATTER OF THEIR OWN NATIONAL INTERESTS (emphasis in original), all three countries should do more to encourage broad-based economic development in Mexico."

In addition to the importance of Mexico implementing publicly supported policies that will attract investment, the U.S. and Canada should establish a North American Investment Fund to create infrastructure that links the poorer parts of the Mexico to the markets in the north and support education and technical training for Mexican states and municipalities, the report urges.

Other steps to promote further integration include adopting a common external tariff on a sector-by-sector basis at the lowest rate consistent with international trade obligations, according to the report, which stresses that "unwieldy rules of origin" and regulatory differences among the three countries are raising the costs of trade rather than reducing them.

On the immigration front, the chairs called for creation of a border pass with biometric indicators that would expedite passage through customs and immigration throughout the region and the adoption of a unified Border Action Plan to boost regional security.

Such a plan would mean harmonising visa and asylum regulations, joint inspection of container traffic entering North American ports; syncronised screening and tracking of people, goods, and vessels, the establishment of a trinational threat intelligence centre and joint training for law-enforcement officials, and closer military cooperation.

The Statement also calls for the development of a North American energy and natural resource security strategy to protect energy infrastructure, fully exploit regional reserves, and reduce emissions and the expansion of educational exchange programmes among the three countries.

Excerpt:

By IPS Correspondents
NEW YORK, Jan 12 2005 (IPS)

Activists from the United States are heading to Brazil for the upcoming World Social Forum, determined to refute the widespread belief that their country has “gone Republican”. They’re also in search of fresh inspiration for the fight against the exploitation of people, and natural resources.

“With the re-election of George Bush, a lot of people around the world washed their hands of the United States,” says Timi Gerson, the field director for Global Trade Watch – a division of the Washington-based group, Public Citizen.

The U.S. president’s second term in office has been greeted with dismay by many. Bush’s critics disagree with several policies adopted by Washington, from the decision to wage war on Iraq, to the U.S. failure to endorse the Kyoto Protocol – an agreement for cutting down on global warming.

Gerson will soon be leaving to participate in the World Social Forum (WSF), a meeting of non-governmental groups that is held in counterpoint to the World Economic Forum. This will be the fourth time that she is attending the WSF.

The World Economic Forum, which takes place in the Swiss town of Davos, gathers together the political and business elite. In contrast, the WSF gives a voice to those who feel marginalised by governments and multilateral institutions – and who seek greater respect for human rights in their communities.

“Part of our role is to show that there is resistance here, and to look at what four more years (of government under Bush) will mean for all of us,” says Gerson. “It’s important to feel that you’re part of an international movement, especially for a lot of activists in the U.S. who feel isolated right now.”

During her time at the WSF, Gerson will focus on strategies to counter controversial trade deals in North and South America, such as the Free Trade Area of the Americas and the Central American Free Trade Agreement. She says the effects of these deals constitute a “crossover issue that…affects working people no matter where they live, whether it’s a laid-off American steelworker or a Mexican farmer.”

While Global Trade Watch has attempted to get media coverage for the Jan. 26-31 WSF gathering in Porto Alegre, Gerson notes ruefully that “it’s been hard to raise awareness of anything here that’s not the war or elections.”

But while the event is not well-known in the U.S., its broad agenda has attracted the attention of dozens of grassroots groups in the country, including labour unions. Anti-debt campaigners, environmental and fair trade activists also sympathise with the aims of the WSF.

At its maiden gathering in 2001, the WSF drew 20,000 participants. Last year, more than 74,000 activists from 117 countries attended the forum (the 2004 WSF was held in the Indian city of Mumbai).

Kristin Sampson of the International Gender and Trade Network, an umbrella group with members around the globe that is sending 23 women to the meeting (including two from the U.S.), says her group is including a link to the WSF web site on its own internet page.

A member organisation of the network called the Center of Concern will also feature an introductory piece on the forum that is likely to be read by people in over 500 Catholic parishes and schools in the U.S.

“For us, the WSF is an important space for social movements – to see how diverse we are, to celebrate this diversity and to find ways to work more closely together where it is strategic,” Sampson says.

Other activists point out that the WSF is coming at a time when people in industrialized and developing nations have been united by the drive to help tsunami victims in Asia and Africa. This has created opportunities to discuss issues pertinent to the developing world, such as debt relief – something that may raise the profile of the WSF in the United States.

“In general, more Americans have been thinking about international cooperation and poor people because of the tsunami,” says John Catalinotto, who is traveling to Porto Alegre with a delegation from the International Action Center, one of the organisations spearheading the drive to end Washington’s occupation of Iraq.

“There are some very basic issues to take up, like water for everybody and land reform. But many of the groups that are going – like the IAC – will be especially interested in what is being done against the war,” he adds.

Just as the European Social Forum of 2002 galvanised 10 million people around the world to demonstrate against the U.S. invasion of Iraq, so Catalinotto hopes the WSF will spark another international day of action to mark the second anniversary of the war.

He agrees that while “people in the (civil society) movement” know about the WSF, it is ignored by the mainstream media and thus largely unknown in the U.S. However, Catalinotto – and others – do not necessarily see this as a liability.

“We’d love to have more awareness raised about this in the U.S., but that isn’t the real purpose behind the WSF from our perspective,” says Ben Lilliston of the Minnesota-based Institute for Agriculture and Trade Policy, a member of the WSF International Council. This body includes representatives from over a hundred groups that develop policies for how the WSF should be conducted.

“It is really a fantastic opportunity to strategise with leaders around the world who are questioning the current system of economic globalisation,” he adds.

Lilliston singled out agricultural subsidies – and the dumping that accompanies them – as “the central most damaging practice in international trade”.

“U.S. agribusiness firms are among the world’s largest dumpers of agricultural commodities. To address the issue of dumping and plunging commodity prices, there must be a global solution,” he said. “The WSF helps put us all on the same path."

Excerpt:

By Marty Logan
MONTREAL, Jun 16 2004 (IPS)

The North American environment would be better off if governments agreed to set aside a section of the continent’s free trade deal that lets them pursue one another for not enforcing their laws, says a review of the deal’s “green” accord.

The study, released a decade after the North American Free Trade Agreement between Canada, Mexico and the United States came into force, largely praises the body set up to implement NAFTA’s environmental side deal.

But in an interview late Tuesday the head of the review panel said the three governments are over managing a citizens’ complaints process because they fear becoming targets of their fellow governments.

”We believe that the governments are probably micro- managing articles 14 and 15 of the NAAEC, which is the citizens’ submissions process … We’re suggesting to the (environment) ministers they should feel comfortable leaving the Secretariat to do its work in this process,” Pierre Marc Johnson, chair of the body that delivered the report, ‘Ten Years of North American Environmental Cooperation’, told IPS.

The NAAEC is the North American Agreement on Environmental Cooperation (NAAEC), which is administered by the Montreal- based Commission for Environmental Cooperation (CEC). Both were created after strong public pressure to write environment protection into NAFTA, the world’s largest free trade deal at the time.

”The national governments sometimes feel uncomfortable because the citizen submission process can lead to very delicate issues,” added Johnson, ”so we’re suggesting they should sort of ignore chapter 5 and commit to ignore it for 10 years, and maybe they’ll leave (articles) 14 and 15 in a freer way.”

In 2003 for example, the attorney general of New York State joined dozens of U.S. and Canadian health and environmental groups in filing a complaint at the CEC against polluting coal- fired power plants in the Canadian province of Ontario.

Soon after, the CEC determined that NAAEC rules disqualified New York from being a party to the complaint. (The submission was rejected last month after a new government in the province promised to phase out coal-produced energy, a move environmentalists supported).

Johnson stressed the review is not suggesting the citizens’ complaint process should be weakened.

”The citizens’ submissions process has been interesting not only in that it can annoy a government and put some sort of shame on them but essentially it sort of forces governments to rethink their implementation policies,” he said.

Added Johnson: ”What we’re saying is that the ministers should meddle as little as possible in that.”

In the citizens’ submission process, after an individual or group files a complaint about lack of enforcement of an environmental law, the CEC Secretariat determines whether the charge warrants approaching the concerned government for a response.

Eventually, the process can lead to the secretariat publicly releasing a ”factual record”, which carries no enforcement power but can lead to an internal review ”and perhaps bring public embarrassment to the party”, according to the report.

As of this February, four factual records have been publicly released in both Canada and Mexico and one in the United States, it adds.

One expert observer says the recommendation to shelve chapter five is probably a realistic one, but that Johnson’s report should have asked for something from the three environment ministers in return.

”It seems to me it would have made some sense for the committee to have made the point (to the ministers), ‘if we let you off this hook you guys have got to stop messing around with articles 14 and 15,” said David Runnalls, president of the Canada- based International Institute for Sustainable Development (IISD).

”I think what (the report is) saying is if there some irritants here that could be removed in exchange for really fixing a lot of the rest of this process, and if part five is the thing that sticks in their craw and they don’t use it anyway, you might as well throw it overboard and see if you can’t use it as a wedge to get some kind of renewed commitment out of the ministers,” he told IPS on Wednesday.

In the interview, Johnson, former premier of the Province of Quebec, praised the performance of the CEC.

”People tend to look at the CEC as the citizens’ submissions process, which seems to be entangled in the intervention of governments, but in practice it’s an extraordinary instrument of international cooperation,” he said. ”And it has proven through dozens and dozens of seminars and groupings of experts in the three countries, stakeholders in governments, NGOs and the private sector, that it can be very useful.”

An earlier CEC report found that NAFTA itself was, by and large, positive for the North American environment.

”The three parties have benefited significantly from the NAAEC,” says the Johnson report.

In Mexico, pesticide control and pollution prevention were improved thanks to the agreement while management of chemicals has improved in all three countries, the report reveals. Also, governments have been made more accountable to their environmental laws, it adds.

On the negative side, the three nations’ environment ministers must become more fully engaged in the process, it says, adding, ”The CEC must respond to the calls from business, indigenous peoples and academics to engage them more actively in the activities of the CEC while maintaining the active engagement of environmental NGOs.”

Runnalls calls that ”diplomatic language.”

”The basic problem is that none of the three governments gives a damn about the Commission on Environmental Cooperation … the ministers don’t take it terribly seriously; it’s a very low priority of all three of the ministers.”

He said he was unsure civil society would disagree with the proposal to shelve chapter five.

”I hope people make a hue and cry about something because then maybe somebody will pay some attention to the CEC. Because (the report’s) basic conclusions are right: it’s actually quite a useful organisation; it does only cost nine million dollars a year … if it had a lot more money it could do a lot more quite good work,” he stressed.

But NAFTA’s ”green guardian” suffered from inflated hopes, according to Runnalls.

”The expectations at the beginning were fairly high that this thing would go into the boxing ring and do battle with the bad guys in the free trade commission … So far as I know, despite lots and lots of efforts by the CEC during the first 10 years, the trade ministers and the environment ministers have never been in the same room at the same time.”

Excerpt:

By Paul Weinberg
TORONTO, Mar 3 2004 (IPS)

A possible customs union between this country and the United States, dismissed as the speculation of technical feasibility studies by Canadian government bureaucrats, could have enormous economic and political implications, warn some observers.

For critics of the current North American Free Trade Agreement (NAFTA), which includes Canada, the United States and Mexico, the exercise signals that Canada’s business lobby has succeeded in pushing its agenda of placing Ottawa even further into the orbit of the United States, its southern neighbour and largest trading partner.

“There is a long tradition of business having jettisoned any adherence to a separate and sovereign Canada, secondary to its own sort of interests,” says Bruce Campbell, an economist and executive director of the Ottawa-based Canadian Centre for Policy Alternatives (CCPA).

Customs union, which involves setting preferential rules of origin on imports between the member states, harmonising standards and regulations of products and services and a common trade policy in a bloc like NAFTA, is just one ingredient in the “deep integration” mix that is being promoted by groups like the C.D. Howe Institute.

But in the run-un to a probable national election this year, a Canadian government spokesperson denies the new government of Prime Minister Paul Martin has decided to move in that direction.

“We are not talking customs union; we are talking about updating our economic and security partnership,” says Scott Brison, a Canadian Member of Parliament and parliamentary secretary for Martin.

Yet the fact that the Policy Research Initiative (a Canadian government think tank) and the powerful federal departments of Finance, Foreign Affairs and International Trade are researching the subject of customs union and consulting outside experts is “significant”, says Tony Clarke, director of the Ottawa-based Polaris Institute, which opposes corporate globalisation.

“The machinery of the Martin government is gearing up for what will be a new era of relationships with the United States. There will be some new bargaining going on,” Clarke told IPS.

Martin took office in December promising to repair the bruised relations with Washington that had developed under his predecessor – also from the ruling Liberal party – Jean Chretien. Notably Chretien, who retired to make way for Martin, refused to support the U.S.-led attack on Iraq in March 2003.

Martin is also following through on negotiations Chretien began with the United States to define Canada’s role in the controversial U.S. missile defence plan for North America.

But his government has not spelled out if it is willing to head in the direction of what is also called ”NAFTA-plus”.

With Martin and his advisors embroiled in an unrelated scandal, Canada-U.S. relations remain “below the political radar” of the public, adds Clarke.

Historically, Canadians have told pollsters they value being separate culturally and politically from their southern neighbours. At the same time, the weekly Macleans magazine reported late last year that 61 per cent of Canadians are willing to accommodate U.S. concerns about terrorism by sharing the administration of immigration and border crossings.

By offering to “reinvigorate” a security, military and energy resources pact with the United States, Canada will succeed in convincing Washington to agree to a new trade deal, argues Thomas d’Aquino, president of the Canadian Council of Chief Executives (CCCE), which represents the country’s major companies.

One of the failings of NAFTA is that U.S. companies are given considerable leeway to use U.S. trade law to legally harass Canadian exporters and impose duties on their products, he adds.

To avoid this problem the CCCE is advocating some form of customs union or European Union (EU)-style single market that would eliminate any rules on both sides of the Canada-U.S. border that impede commercial trade and labour mobility.

D’ Aquino wants to use the model of the International Joint Commission (a Canada-U.S. body that monitors trans-border water issues) for new structures that would govern the already highly integrated economies of the two countries.

“Let’s take control of (integration) and manage it in the interests of Canada, but at the same time making a contribution to North America,” he said in an interview.

But University of Toronto political economist Stephen Clarkson doubts that would succeed for a number of reasons. For instance, protectionist politicians in the U.S. Congress are in no mood for a deal that would involve surrendering U.S. trade and economic sovereignty to a EU-style tribunal, he says.

Also, “I just think that is wildly unrealistic, now that Mexico is more important to Washington then Canada, politically speaking”.

“There is a tremendously nostalgic quality to the big business thinking, which is based on (the idea) we can somehow maintain or get back to the special Can-Am (Canadian-American) relationship, which we thought, anyway, characterised the 1960s,” says Clarkson, author of ‘Uncle Sam and U.S. Globalisation, Neoconservatism and the Canadian State’.

Also, the Canadian business community and the Policy Research Institute are unrealistically studying a Canada-U.S. economic link, minus the participation of Mexico, adds Clarkson in an interview.

“How can you do a customs union without Mexico, given NAFTA? It is essentially very hard to work out. And how do you it anyway if Mexico has its own trade agreement with the European Union?”

Not included in the PRI research is any analysis of Canada’s political sovereignty if its economy further integrates with the giant U.S. economy. “My sense is that it is not our role to assess political costs. Most of us are economists,” says Andre Downs, a senior project manager at PRI.

But those political concerns are valid and they are being discussed inside and outside government, says Andrew Jackson, a senior economist with the Canadian Labour Congress who attended one of PRI’s roundtable discussions.

“I don’t mind saying, having been at that (PRI) seminar, that it was kind of clear to me that there were serious disagreements in different parts of the federal government (regarding customs union),” Jackson told IPS.

The tendency in customs unions is for the regulations of the larger country to predominate, says Marc Lee, a Vancouver-based economist with the CCPA.

In some areas where the United States has tougher regulations (the environment, for instance) Canadians might benefit in the short-run, he adds.

But Lee warns that other distinctive and worthwhile Canadian policies involving culture, refugees, agriculture, intellectual property rights and foreign ownership restrictions would disappear in any enhanced economic deal with Washington.

“The whole issue is about democracy. It is about the scope that Canadians have to set their own domestic regulations according to their own needs,” he adds.

Excerpt:

By IPS Correspondents
OTTAWA, Dec 31 2003 (IPS)

North America’s trade deal drove down the real wages of Canadian workers by about 20 percent – if they did not lose their jobs altogether, says globalisation critic Murray Dobbin, author of a critical book about Canada’s new prime minister, Paul Martin.

“All of the studies have shown that workers in Mexico, the U.S. and Canada have not profited from NAFTA,” says Dobbin, whose book ‘Paul Martin: CEO for Canada’, argues the multi-millionaire prime minister broke the unions in his companies, closed domestic shipyards and registered his fleet under “flags of convenience” to drive down wages and workplace rights.

“Proponents of the deal have a mantra of ‘competitiveness’, but what we’ve seen is a race to the bottom as governments erode workers’ rights, wages and environmental regulations to try to be more competitive,” Dobbin told IPS.

The federal government manipulated the Canadian dollar’s exchange rate, the country’s unemployment benefits system and other mechanisms to effectively deny workers an increase in their real wages through the 1990s, he adds.

Dobbin said the erosion of jobs and buying power occurred when Canada racked up huge trade surpluses. “It’s ironic that these surpluses came at a time when workers have seen the greatest erosion of their real wages since the Great Depression of the 1930s.”

But Canadian officials disagree. The governing Liberal Party, which came to power in 1993 partly on a platform of “reconsidering” NAFTA (the North American Free Trade Agreement), now supports the deal.

The trade agreement between Canada, the United States and Mexico will mark its 10th anniversary Jan. 1.

U.S. investments in Canada ballooned to 215 billion dollars (166 billion U.S. dollars) in 2001, an increase of 150 per cent in the past 10 years, according to government figures. During the same period, Canadian investment in U.S. companies jumped 230 percent, to nearly 200 billion dollars.

Overall, Canada has been one of the world’s few economic success stories, generating 560,000 new jobs and growing 3.4 percent in 2002, the fastest rate among the top seven industrial economies, says Ottawa.

With the United States by far the country’s leading trade partner, Pierre Pettigrew, Canada’s former minister for international trade, said Canadians expect to see more NAFTA benefits once the U.S. economy recovers.

“Canadian businesses and Canadian labour are quietly cheering and very hopeful that that sense of optimism is coming back into the U.S. market,” Pettigrew said at a recent trade conference.

“The North American Free Trade Agreement has been a tremendous success. From 1993 to 2001, Canada’s merchandise exports to its NAFTA partners increased almost 95 percent. Mexican exports increased by 221 percent, and U.S. exports increased by 86 percent.”

Pettigrew, who wrote a book supporting globalisation before joining the Canadian cabinet in 1996, says he sees NAFTA as an important step toward greater world economic integration and more free trade.

“These regional and bilateral agreements help to open specific markets, build negotiating capacity, strengthen the appetite for further liberalisation, and even blaze a trail for WTO (World Trade Organization) rules.”

Business groups, which campaigned in support of the deal in the 1988 and 1993 federal elections, still strongly support NAFTA

“Canadians, in general, are pretty big fans of NAFTA … it seems to have worked pretty well for us,” said Finn Poschmann, an analyst with the business-oriented C.D. Howe Institute, a Toronto-based think tank specialising in economic and social policy.

The Canadian government supports the Free Trade Agreement of the Americas (FTAA), which would further strengthen the hand of industries to challenge governments’ regulation of the economy, environment and workers’ health and safety.

In fact, only the New Democrats, the fourth-ranked party in Canada’s Parliament, oppose NAFTA and globalisation, with most criticism of the deals coming from nationalist groups such as the Council of Canadians, trade unions and think tanks like the Canadian Centre for Policy Alternatives (CCPA), which regularly issues studies into the impact of trade deals.

CCPA economist Andrew Jackson, who has studied Canada-U.S. free trade extensively since the first bilateral agreement was signed in 1988, says “it is hard to sustain the argument that workers have fully shared in the relatively modest productivity gains that some have attributed to the FTA, and hard to deny that economic integration has tended to tilt the bargaining scales against workers”.

Some development activists in Canada had hoped the transfer of jobs to Mexico would improve the lot of workers in that country. Dobbin says Mexico gained some jobs and exports, but at the price of a huge jump in imports that have caused Mexico to have a lopsided balance of trade in the U.S.’ favour.

Dobbin says Canada has lost 300,000 industrial jobs to Mexico and low-wage, anti-union southern states in the U.S. But, he says, those jobs have been transitory in their new locations.

”Now, jobs are leaving the NAFTA region for China, where people work for 14 cents an hour. In the end, no one can compete with that.”

Excerpt:

By Emad Mekay
WASHINGTON, Dec 26 2003 (IPS)

After 10 years a deal that all sides say transformed trade and investment rules in North America has still produced far fewer positive results than originally promised, according to its critics.

"Had they (original promises) come true, NAFTA would have been an enormous boom and we would all be cracking champagne," said Lori Wallach, director of the global trade watch programme at Washington-based Public Citizen, a consumer rights group.

"But instead we have got the 10-year record and it’s pretty damn grim."

When NAFTA (the North American Free Trade Agreement) was being sold to the U.S. Congress and the public in Canada, Mexico and the United States in the early 1990s, its promoters promised the deal would create hundreds of thousands of high-wage U.S. jobs, raise living standards in all three countries and improve environmental conditions and transform Mexico from a poor developing country into a booming economy.

But NAFTA’s real-life damage to jobs, wages and the environment after 10 years has made many people in North America furious about the trade policies the deal was built upon (policies that provide the foundation for subsequent agreements such as the forthcoming Free Trade Area of the Americas, FTAA).

"NAFTA’s 10-year record demonstrates that under the NAFTA model most people in the three countries were losers, while only a few of the largest corporations who helped write NAFTA were the major winners," Wallach said.

Thanks to the deal, which celebrates its anniversary Jan. 1, major companies – like auto makers General Motors, Ford and Chrysler – can set up shop in Mexico, employ cheap labour in that country and then export the finished products to Canada and the United States.

NAFTA rules also limit each country’s domestic policies to deal with issues ranging from environmental health and food safety to banking and truck safety regulation.

Under the unprecedented investor rights sewn into the deal, investors are allowed to demand compensation for "indirect expropriation", which has been interpreted to mean any government act – including those directed at public health and the environment – that diminishes the value of a foreign investment.

Following one such suit, the Mexican government was ordered in August 2000 to pay nearly 17 million dollars to a California firm that was denied a permit from a Mexican municipality to operate a hazardous waste treatment facility in an environmentally sensitive location.

U.S. workers were promised 170,000 additional jobs in each of NAFTA’s first 10 years, based on the deal increasing the trade surplus with Mexico and lowering the pre-NAFTA trade deficit with Canada.

But instead of the surplus, the United States now runs an average 37-billion-dollar annual deficit with Mexico, and has lost close to three million manufacturing jobs.

Under one government programme for displaced workers, the NAFTA Trade Adjustment System – for which only a relatively small number of the deal’s potential victims could qualify – 525,000 U.S. workers were certified as NAFTA casualties because their jobs were transferred to Mexico.

According to Public Citizen, despite the economic growth of the 1990s, U.S. real wages are still below 1972 levels, while income inequality has skyrocketed because of the shift from manufacturing jobs to employment in services, where wages are far less.

According to the Institute of Policy Studies, NAFTA has also had a detrimental impact on the ability of U.S. workers to fight for better wages and working conditions. U.S. employers now often threaten to move to Mexico and other low-wage countries in order to fight unions and restrain wages.

The use of such threats in union organising drives increased from about 50 percent in the early 1990s to 62 percent in 1998 and 68 percent in 1999, says the Washington-based institute.

The U.S. government points to different figures to buttress its pro free-trade arguments. According to data from the U.S. Trade Representative office, total trade among the NAFTA countries more than doubled between 1993 and 2002.

It says foreign direct investment by NAFTA partners in the three countries jumped from 136.9 billion dollars in 1993 to 299.2 billion dollars in 2000.

Last week, the World Bank also said NAFTA was, overall, a positive deal, especially for Mexico. For example, it triggered productivity growth, as the country needed only about one-half the time to adopt foreign technology during the span of the deal than it did before.

But according to a recent report by the Global Resource Action Centre for the Environment (GRACE), NAFTA has displaced 1.75 million Mexican farmers from their land, forcing them to migrate to the cities or the United States.

According to Lauren Carlsen, director of the Americas programme of the Inter-hemispheric Resource Centre, an advocacy group based in Mexico City, farm prices – especially for maize – have plummeted during the deal’s lifetime in the face of heftily subsidised imports from the United States.

Incomes in Mexico have also nose-dived. According to the Centre for Economic and Policy Research (CEPR) in Washington, in 10 years income per person has grown by only nine percent in Mexico, about one-fifth of the growth in the 1960s and 1970s.

"No economist can honestly call that a success," said Mark Weisbrot co-director of the CEPR.

NAFTA was also promoted as a route to good jobs and improved living conditions, especially via maquiladoras, companies that are permitted to operate duty-free in nations that provide them with cheap labour – in the NAFTA case, U.S. firms setting up in Mexico.

"Instead, we got low wages, sexual harassment, environmental destruction and birth defects," said Marth Ojeda, director of the Coalition for Justice in the Maquiladoras, herself a maquiladora worker.

"Most maquiladora workers are very young, between 16 and 25, because their eyes, backs and hands haven’t given out yet – their hours are so long that their youth passes without seeing the sun," added Ojeda.

Workers and government services in Canada, the third NAFTA partner, did not fare any better.

Canada’s former prime minister Brian Mulroney called the deal a "cold shower" at its inception, something the country needed to go from a so-called welfare state to one primed to compete in the international sphere.

But 10 years later, many critics say the business community has actually exploited the deal to push for cuts in social programmes, arguing they were necessary to compete with the lower costs faced by U.S. businesses, operating in a nation with generally lower levels of worker protection.

The clearest example of that, critics say, is the impact is the scaling back of Canada’s unemployment insurance.

According to the Canadian Centre for Policy Alternatives, the percentage of unemployed workers who qualified for this scheme (now known as "employment insurance") dropped from 87 percent in 1989 to only 39 percent in 2001.

"We have lowered social spending so much that we have moved from being first in the world in the United Nations human development index to number eight last year," said Maude Barlow, chairperson of the Council of Canadians, the country’s largest public advocacy organisation.

"And three target groups have been hit the worst: the unemployed, low-income earners and the elderly," she added. "It’s pretty well time we stopped thinking that we are a kinder and gentler nation."

If there is one major lesson of NAFTA that many analysts from all three countries agree on, says the Institute of Policy Studies, it is that "there is no guaranteed link between trade and investment liberalisation and improvements for workers or the environment".

Excerpt:

By IPS Correspondents
MEXICO CITY, Dec 23 2003 (IPS)

The North American Agreement on Environmental Cooperation (NAAEC) is the only such mechanism in the world to accompany a free trade treaty. For 10 years it has been at the forefront in keeping an open channel to citizens, but it shows signs of weakness amidst the overwhelming force of international commerce.

The three-nation agreement is undergoing an evaluation in which independent experts and civil society groups will define its future. Although the results will not be known until mid-2004, there are already those who give it low marks and make gloomy predictions.

The NAAEC and its executive arm, the Commission for Environmental Cooperation (CEC), are cited as examples that could serve trade talks underway to set up the Free Trade Area of the Americas – but the environment is an issue notably absent.

Those who want to benefit from the North American region’s experience "may do so, and that includes the trade negotiators" from other parts of the world, CEC executive director William Kennedy told Tierramérica.

The environmental accord – established in parallel to the North American Free Trade Agreement (NAFTA) involving Canada, Mexico and the United States – has accumulated a mixed history of positives and negatives over the past decade.

The CEC claims as achievements the many studies and initiatives for measuring the environmental impacts of trade, which, according to different reports, range from moderate to what some consider nearly catastrophic.

The available studies, many conducted by the CEC, indicate that the intense flow of goods among the three NAFTA members has, for example, aggravated air quality problems and driven up the accumulation of toxic waste.

Trade has also contributed to the decline of agriculture in Mexico, where the once notable production of maize has been contaminated by the genetically modified seed exported by the United States.

According to official figures, a thousand Mexican rural people move to the cities each day, the result of their inability to compete in the agricultural market in the NAFTA context.

The mission of the CEC is to prevent potential environmental conflicts arising from trade relations and to monitor compliance with the NAAEC. But it is suffering financial problems that cast its future into doubt.

While annual trade amongst Mexico, Canada and the United States has risen since 1993 to more than 620 billion dollars by 2002, the CEC’s budget remains unchanged at nine million dollars, financed equally by its three members.

The NAAEC will be what they want it to be, says Kennedy, while confirming that the commission’s budget is really on the decline as a result of inflation and the depreciation of the dollar.

In real terms, the CEC budget for 2004 will be some 2.2 million dollars less than in 203. "That means we will have to tighten our belts and monitor spending in order to be effective," said the executive director.

Furthermore, its action record includes just 42 citizen reports of violations of the regional treaty’s environmental rules and none from the three governments.

Gustavo Alanis, current chair of the joint public consultative committee that supports the CEC, believes the environmental accord and its executive arm need to assume a position of strength in order to achieve greater impact, and thus win more financial support from Mexico City, Ottawa and Washington.

"It must be recognised that NAFTA’s parallel environmental agreements are little known in the three countries, which has prevented them from being utilised as they should be," he said in a conversation with Tierramérica.

The NAAEC and the CEC "have not been able to contain the environmental damages caused by increased trade and the interests of big corporations," says Alejandro Calvillo, head of Greenpeace-Mexico, which set up shop in 1993 in order to keep an eye on the potential impacts of regional free trade.

But these instruments "are better than nothing, because they hold some political weight," Calvillo said.

"We are worried about the CEC’s future, because in addition to financial troubles, it is under a lot of pressure from governments, especially from Washington, which wants to further cut its funding and its power," he said.

"There is absolutely no pressure" on the CEC, responds Kennedy. "We have three equal partners that contribute equally."

Despite it all, the CEC has its strong points. "It is a cutting edge instrument in the international sphere," and should be promoted more, says consultative committee leader Alanis. "Its focus is on transparency and citizen participation."

The North American environmental accord allows individuals and groups to file denunciations with the CEC against their governments for failure to comply with environmental regulations. The process can lead to a report on the facts, which tend to be critical, but which do not involve sanctions.

The 42 claims filed to date cover issues related to biodiversity, unregulated logging, contamination of water supplies, storage of toxic waste and the construction of environmentally harmful mega-projects, among others.

But perhaps that is little to show for one decade of operations. "We hope in the coming years to be more effective in our contact with the public," says Kennedy.

So far, just nine of the claims have been finalised and made public, though three more are slated for dissemination in the near future, according to the CEC executive director.

The rest of the cases, most of which were filed by organisations or people from Mexico, have been set aside due to failure to meet the formal requirements or because of decisions by the NAFTA members.

One of the NAAEC’s provisions that has come under fire from environmental activists allows the accused governments to state that certain denunciations will not be processed or that the results of investigations will not be made public.

Furthermore, the party filing the claim does not have the right to respond to the arguments used by the accused to defend itself from the charges.

Greenpeace director Calvillo hopes that the CEC "demonstrates what little remains of its strength" when it issues the report on the effects of trade in genetically modified maize from the United States, sold throughout the region under NAFTA’s protection.

The environmental watchdog wants the final report, which could be released in March, to include a recommendation to halt sales of transgenic crops. The prospects for such an extreme measure are uncertain.

"We recommend that in the future the North American Agreement on Environmental Cooperation undergo reforms to be more effective, so that its position at the cutting edge is translated into an example of effectiveness," says Alanis.

(* Diego Cevallos is an IPS correspondent. Originally published Dec. 20 by Latin American newspapers that are part of the Tierramérica network. Tierramérica is a specialised news service produced by IPS with the backing of the United Nations Development Programme and the United Nations Environment Programme.)

Excerpt:

By IPS Correspondents
BOGOTA, Dec 18 2003 (IPS)

Critics of the impact of free trade agreements on Latin America, especially the projected effects of the FTAA, say the number of street vendors will increase in the region’s large cities.

Due to the inevitable flood of U.S. farm products, which have a competitive edge thanks to the huge government subsidies shelled out to U.S. farmers, ”the most likely scenario is an increase in street vendors” in the big cities of Latin America and the Caribbean, said Salvadoran economist César Villalona.

William Rodríguez, with Nicaragua’s International Studies Centre, also predicted an increase in rural and urban unemployment, as well as the disappearance of traditional forms of production like the artisanal or manual production of corn tortillas, ”which will begin to be manufactured like compact discs.”

That panorama was described by Villalona, Rodríguez and other independent economists and delegates of non-governmental organisations taking part in a Dec. 10-13 seminar on the possible effects of the FTAA (Free Trade Area of the Americas) and other trade deals with the United States.

The seminar was organised by the Latin American Institute of Alternative Legal Services (ILSA).

The ”geographic logic” of free trade agreements is in line with ”the expansionist policy” of the United States, Héctor Moncayo, with ILSA, told IPS.

He said it started with the North American Free Trade Agreement (NAFTA), which has linked the United States, Canada and Mexico since 1994.

On Wednesday, the United States reached a free trade agreement with four Central American countries (Costa Rica withdrew at the last minute).

The next step, said Moncayo, will be efforts to negotiate agreements with the Andean nations.

Because the United States ”is a huge gravitational force in the continent,” the free trade agreements that will be most heavily promoted will be bilateral deals with Washington, he added.

The FTAA draft agreement reached by 34 trade ministers in Miami on Nov. 20, which was dubbed ”FTAA lite”, actually encourages the possibility of bilateral negotiations.

Two days before the ministerial meeting in Miami, U.S. Trade Representative Robert Zoellick sent a message to the U.S. Congress announcing that President George W. Bush wanted to start bilateral negotiations with Colombia, Ecuador, Peru and Bolivia.

The four countries, which along with Venezuela make up the Andean Community, hope to continue enjoying the trade preferences they are granted by the U.S. Andean Trade Promotion and Drug Eradication Act (ATPDEA), in compensation for their anti-drug efforts.

Participants in the ILSA seminar pointed to the scant benefits felt by the majority of Latin Americans as a result of commodity exports, and due to the small proportion that manufactured products represent in overall exports.

Per capita export revenues range between 1,000 and 2,000 dollars in Chile, Costa Rica, Jamaica, Mexico, the Dominican Republic, and Uruguay, and between 400 and 1,000 dollars in Argentina, Ecuador, El Salvador, Honduras and Paraguay.

The lowest per capita export revenues are found in Colombia (272 dollars) and Brazil (250 dollars), although the low rates are compensated by larger domestic markets – huge in the case of Brazil, Latin America’s giant, said the president of the Colombian Society of Economists, Amilkar Acosta.

The speakers said small and medium farmers are among those hit hardest by the negative impacts of free trade accords.

In El Salvador, the livelihoods of more than half a million farmers who grow fresh produce and grains and raise chickens and other livestock are jeopardised, while more than nine million dairy farmers in Central America are at risk of losing their source of income.

Referring to the lessons that other Latin American nations can learn from Chile’s experience with bilateral accords with the United States and the European Union, Manuel Riesco, with the Agricultural Consortium of the South, a Chilean group, told IPS that ”the best thing is to obtain the longest timeframes as possible, to gain time for the economy to adapt.”

Chile signed a free trade agreement with the EU in November 2002 and another with the United States in June 2003.

Riesco argued that ”it is important to understand that the agreements that are being negotiated will definitely be signed. We opposed them, but we obviously lost.”

”You don’t negotiate with the United States – you either sign on or you don’t,” he added.

The activist pointed to the very different effects that the free trade agreements have had on fruit farmers in central Chile, an area with a Pacific version of the Mediterranean climate, whose products find a strong market in North America, and on farmers in the south.

”The experience has been bad” for growers of traditional crops like cereals and grains, cooking oil producers, and dairy and beef farmers in five of Chile’s 13 regions, he explained.

Economist Cristian Candia, with Consumers International (CI), said ”the rights of consumers are absent in the negotiations.”

CI groups 250 consumer rights federations from 117 countries, including virtually all consumer rights groups in Latin America and the Caribbean.

”The free market in and of itself does not ensure any benefits for consumers, even though the free trade accords claim to do so,” he told IPS.

”Benefits for consumers are an afterthought, standing far behind the rights of investors,” he maintained.

In Candia’s view, free trade treaties ”consecrate the right to invest capital above all other economic and social rights.”

”We are witnessing ‘equal treatment’ under unequal conditions, which generates regressive situations in the distribution of wealth and in the sphere of social rights, in the North as well as the South,” said the activist.

Moncayo said he was in favour of ”continuing to fight” against the conditions imposed by the free trade agreements, and against the loss of livelihood suffered by significant groups of small and medium farmers throughout the region.

He also predicted that resistance to free trade agreements would be a central issue and a dividing point in elections in Central America next year.

With respect to Colombia, Moncayo said that despite the fact that the country’s team of negotiators says their strategy is ”to obtain the most, at the least possible cost, the reality is that the country’s main objective is to maintain the preferences it enjoys under the ATPDEA.”

But the benefits are not likely to remain in place, he said. After a meeting with U.S. lawmakers, Colombia’s Minister of Foreign Trade, Industry and Tourism, Jorge Botero, admitted that the legislators told him to forget about the ATPDEA, ”because it is going to expire,” and that they proposed ”starting from scratch in negotiations” of a bilateral treaty.

Former finance minister Juan Santos had already warned that ”the gringo negotiators go for the jugular vein, and I’m speaking out of experience.”

With regards to an eventual accord between the four Andean nations and the United States, Santos said ”we’re talking about negotiating with the world’s superpower, which will try to squeeze us dry, to the very last drop.”

He recommended finding a way ”to avoid sacrificing our markets in the treaty.”

Acosta, meanwhile, warned about the disadvantages that the FTAA and an eventual bilateral free trade agreement with the United States would have for Colombia, ”unless the current economic model is modified, because Colombia will be condemned to serve as Uncle Sam’s mascot.”

He grimaced when recalling the joy expressed by the Colombian delegation at the FTAA ministerial meeting in Miami. ”Remember that in the times of the Roman empire, the gladiators sent in to fight would stand before the emperor and say ”Hail, Caesar! Those who are about to die salute you!”

Excerpt:

By Emad Mekay
WASHINGTON, Dec 17 2003 (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.”

Excerpt:

By Emad Mekay
WASHINGTON, Dec 17 2003 (IPS)

Contradicting a number of recent studies and findings by independent think tanks and activists, the World Bank says the controversial North American Free Trade Agreement (NAFTA) has spurred economic development in Mexico.

In a report released Wednesday in advance of the 10-year anniversary Jan. 1 of the implementation of the agreement between Mexico, the United States and Canada, the bank, the world’s largest development agency, said that Mexico experienced productivity growth, better jobs and more efficient agriculture.

The findings sharply contradict studies from several trade unions, farmers’ organisations and manufacturing lobbies that have all said the deal helps big businesses in the United States at the expense of workers, the poor and ordinary people in all three countries but especially in Mexico, the only developing nation involved.

Similar research work by the bank has previously come under fire from independent economists and many civil society groups, which accuse the Washington-based institution of skewing its studies to fit the economic agenda of its political masters from the group of seven (G7) most industrialised nations, including the United States, Britain and Japan.

According to the 346-page report, ‘Lessons from NAFTA’, the deal had no adverse impacts on workers or the agricultural sector.

It says the Mexican labour market recovered relatively quickly after the tragic adjustments of the 1994-95 so-called Tequila crisis, which caused a wave of bankruptcies and forced many banks to shut down.

Unemployment and real wages have now returned to pre-1994 levels, said the World Bank.

Pushing its customary economic argument that foreign investment naturally results in improved local economies, the bank found that in Mexico, “wages and employment tend to be higher in states with higher foreign direct investment and trade, and out-migration from those states is lower”.

“Wages are also higher in sectors with more exposure to imports or exports,” said the report.

“More generally, free trade has increased the demand for a more skilled Mexican workforce, a challenge the educational system must be prepared to meet,” said William F. Maloney, a lead economist at the bank and one of the report co-authors, in a statement..

The bank also said that NAFTA spurred productivity growth in Mexico, as the country needed only about one-half of the time to adopt foreign technology during the span of the deal than it did previously.

“In addition, the national innovation effort also rose modestly after NAFTA, possibly due to the strengthening of intellectual property rights,” it added.

On the controversial issue of agriculture, the report says that Mexican farmers, including those at the subsistence level, were not harmed by the deal, as is widely claimed.

“NAFTA has been quite positive for export agriculture, but it has probably had little impact on small farmers in the southern states, who have suffered a long history of social, political and economic neglect,” said Daniel Lederman, co-author and World Bank senior economist.

The report went on to blame “Mexico’s deficiencies” in education and research and development for restricting what the bank said was “the power of NAFTA” to enable the country to reach the level of technological progress of the United States or countries such as South Korea.

The report findings contradict sharply those by other research groups, which found the decade-old deal did not help Mexico boost its economy, create jobs or rejuvenate its agricultural sector, as promised.

“NAFTA has not helped the Mexican economy keep pace with the growing demand for jobs,” said a recent report by the Carnegie Endowment for International Peace, a Washington-based think-tank.

While foreign direct investment in Mexico led to the creation of 500,000 manufacturing jobs from 1994 to 2002, the country lost at least 1.3 million jobs in the agricultural sector alone, where one-fifth of Mexicans still work, added Carnegie.

Further contradicting the World Bank report, the Carnegie study says the real wages of most Mexicans today are lower than they were when NAFTA took effect.

On Tuesday, the U.S. consumer interest group Public Citizen released another report arguing the deal “has had devastating effects on millions of people in Mexico, Canada and the U.S.”

Public Citizen says NAFTA has eliminated 99 percent of Mexico’s agricultural tariffs, meaning, for example, that since 1994 the amount of U.S. corn dumped – sold at subsidised prices – on the Mexican market has increased 15-fold.

Similarly, the amount of U.S. beef going into Mexico has doubled, poultry has tripled and pork imports have quintupled.

The sentiment that the NAFTA did a lot more damage than good to Mexico is also echoed by activists and economists in that country.

“A large number of Mexicans feel that the sacrifices they made for NAFTA over the last 10 years have exceeded … the benefits that have been concentrated in a handful of people, who were naturally the promoters of NAFTA – that’s to say, multinationals, government technocrats,” said Carlos Heredia, an economist and former deputy director in Mexico’s Ministry of Finance.

Heredia, who is also the director of ‘Equipo Pueblo’, a Mexico City-based non governmental organisation (NGO), said in a teleconference Tuesday that when research groups refer to the benefits of NAFTA in Mexico they are alluding to the gains for U.S. multinationals established in the country yet registered in the national accounts as Mexican.

“In fact, it’s intra-firm trade,” he said. “It’s trade between a multinational established in Mexico and its headquarters in Detroit or elsewhere in the United States … working people and poor people have paid a high price for trade liberalisation while benefits have been extremely concentrated.”

Excerpt:

By Emad Mekay
WASHINGTON, Dec 10 2003 (IPS)

Representatives from trade unions, human rights and civil society groups joined U.S. legislators Tuesday in denouncing a free trade deal the United States is negotiating with five Central American nations as an official failure to address labour, environmental and public health concerns.

The final round of talks for the U.S.-Central American Free Trade Agreement (CAFTA) is currently under way between the U.S. Trade Representative and trade ministers from Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua. The aim is to take down tariffs and other trade barriers between the six countries by the end of next year.

The actual text of the agreement has been kept away from the public and the talks in Washington remain off-limits to the media. But U.S. trade officials say that a final draft will be presented to the countries involved.

The George W. Bush administration expects to bring CAFTA to Congress in the first six months of 2004.

The deal is being modeled after the North American Free Trade Agreement (NAFTA) among Mexico, Canada and the United States. Critics say NAFTA did not improve the lives of millions of poor Mexicans and cost the jobs of workers in Canada and the United States.

Several groups opposing CAFTA say it will not fare any better and call the deal “neither fair nor free”.

Oxfam America, the American Federation of Labour-Congress of Industrial Organisations (AFL-CIO), the Washington Office on Latin America, World Vision, Health GAP and more than two dozen U.S. church groups, including the National Council of Churches in Christ, pledged on Tuesday to oppose the trade deal.

Much of the opposition to CAFTA stems from the United States’ history of protecting U.S. farmers, imposing its own corporate-backed agenda and failure to protect the environment, public health and labour rights.

Farm groups in the U.S. also say deals like CAFTA only benefit corporate traders and create distorted market conditions.

“We are opposed to U.S. farm and trade policy that creates dependency on U.S. taxpayer-funded subsidies, that suppresses prices, and that benefit corporate grain traders,” said Kathy Ozer of the U.S.-based National Family Farm Coalition.

Some U.S. policy makers on Tuesday said they were specifically opposed to the deal because it lacks provisions on labour standards, and asked the administration to fix it or risk opposition in Congress.

Michigan Rep. Sander Levin told reporters that he will oppose the agreement when it comes to Congress next year.

“I am here to say to say to the administration, turn it (CAFTA) around or it will be turned down,” Levin said. “CAFTA will not pass the United States Congress in 2004 if core labour rights are not included in the trade agreement.”

“When you look at the schedule for this week for the CAFTA negotiations, labour is there for one afternoon and for a few hours while other issues are provided much more time,” he said. “The administration is stuck in the mud on this. There’s no indication that I can see that they are going to move off it – but I hope that the mud is not quicksand.”

Ana Sol Gutierrez, a Maryland State representative, says the deal turns human beings in her native country of El Salvador into machines working for corporate businesses in the United States.

“Human beings have become commodities and widgets and machines that can produce cheaper and faster and damn how they live and damn what happens to them,” she said. “El Salvador has come to the point where it should change its name to El Salvador, Inc.”

American groups are also worried that the deal lures developing countries by offering “limited” market access while at the same time jeopardising an already fragile employment situation in the United States.

CAFTA’s proposed chapter on labour requires that governments enforce their domestic labour laws, but does not require countries to revise their laws to meet international labour standards.

Thea Lee from the AFL-CIO, the largest U.S. trade union, says that Bush administration, at the behest of the U.S. business community, is using the lure of wider market access to promise prosperity and development to Central America when in fact it wants to impose a corporate agenda on investment rules, intellectual property rights, services and government procurement.

At the same time, she said, the administration was “trading away American jobs”.

“The Bush trade policy is a corporate boondoggle, disguised as free trade,” Lee said.

Lee says that her group is worried that CAFTA asks countries to enforce their own labour laws, “whatever they might be”, rather than requiring them to implement strong labour rights.

“Countries do not actually have to have labour laws,” she said. “They could eliminate labour laws. They could ban trade unions and they could eliminate any protection for child labour and there’d be no dispute-settlement action that could be taken under the CAFTA in terms of the agreement we’ve seen..”

Human Rights Watch called on officials negotiating the free trade agreement to ensure that workers’ rights are guaranteed in the deal, especially in El Salvador, where it says labour rights were systematically violated.

On Tuesday, AIDS activists protesting provisions in CAFTA that reinforce patent rights over life-saving drugs blocked mid-day traffic in Washington. The protesters lay down across the street from the Mayflower Hotel, where talks between U.S. and Central American trade officials were taking place.

Wearing hospital gowns reading “Another AIDS Death from CAFTA”, the protestors, including people living with AIDS, also set up a make-shift hospital ward.

“Break the Patents, Treat the People,” they chanted.

Excerpt:

By IPS Correspondents
NEW YORK, Dec 10 2003 (IPS)

Farmers and peasant groups around the world are pressing the concept of ‘food sovereignty’ as a challenge to the World Trade Organisation’s agriculture policies, which they say push millions of small farmers off their land and lead to food insecurity.

Described by the international farmers network Via Campesina as “the right of peoples to define their own food and agriculture; (and) to protect and regulate domestic agricultural production and trade”, food sovereignty, its proponents say, is the only way to alleviate poverty and achieve sustainable development in the developing world.

The People’s Food Sovereignty network, a coalition of non-governmental organisations and movements from the North and South, released a Food and Agriculture statement on its website demanding that “governments remove agriculture and food from the World Trade Organisation (WTO) and establish an alternative international framework for the sustainable production and trade of food and agriculture”.

“Millions of peasants in the third world have been actively working to develop food sovereignty as a movement for the past five to 10 years,” said Dr. Raj Patel, a policy analyst at the Oakland-based Institute for Food and Development Policy (Food First) in a telephone interview.

A new report released by Food First claims that food security – the goal championed by multilateral agencies to ensure that people have enough to eat each day – does nothing to secure productive land for rural farmers or stable prices for their crops.

“Food security says that every child, woman, and man must have the certainty of having enough to eat each day, but it says nothing about where that food comes from or how it is produced,” said Dr. Peter Rosset, author of the Food First report, in a statement.

“Thus in trade negotiations underway in the WTO, NAFTA and the proposed Free Trade Area of the Americas (FTAA), Washington is able to argue that importing cheap food from the U.S. is a better way for poor countries to achieve food security than producing it themselves.”

NAFTA, or the North American Free Trade Agreement, was created in 1992 and includes the United States, Canada and Mexico. The FTAA, a much larger version of NAFTA, is set to be launched in 2005, but has come under intense criticism by farmers, trade unions and activists from North and South America who fear the deal will entrench neo-liberal trade policies harmful to developing countries.

The World Bank, which is highly influential in shaping food and agriculture policy and projects in developing countries, identifies on its website three dimensions of food security as food availability, affordability, and stability of access. The Bank says that free trade is essential to food security because it makes the most efficient use of world resources.

Patel disagrees with this interpretation, and says that free trade as espoused by the World Bank does not exist because of subsidies, disguised taxes, and hidden environmental and social costs.

“There is no such thing as free trade,” he said, “The World Bank can have all the theories they want, but the evidence shows that poor people are not helped by liberalising trade.”

Via Campesina says that by prioritising international trade over local food production, the WTO’s free trade agenda increases the dependence of developing countries on cheap imports of subsidised grains from the North, causing hundreds of millions of farmers to abandon traditional agricultural practices.

Patel, an expert in rural development, explained that U.S. corn is sold below the cost of production due to massive government subsidies, and that exporting it to Mexico devastates peasant farmers who cannot compete with the artificially low prices. He said that subsidising and dumping corn in Mexico is “almost like targeting the impoverished farmers”.

“It’s bitter and cruel to say free trade is enhancing food security,” he added.

According to Patel, there are three areas of Chiapas, Mexico where peasants are demanding food sovereignty as a democratic process to allow them to define and control the local food system, and to protect their land and livelihoods from foreign agribusinesses and the vagaries of the global marketplace.

Via Campesina is pressuring the United Nations Human Rights Commission to recognise the right of peasants to produce food as a fundamental human right, and is using the power of the Internet to challenge entrenched positions in trade negotiations.

Patel said that agriculture should be removed from WTO negotiations because the millions of farmers who are most affected are not represented. He claims that even though organisations like Via Campesina appear at WTO negotiations, they are not given a true voice in the proceedings, which are exclusively the domain of governments and corporate lobbyists.

“Until there is genuine democracy and transparency in trade, agriculture should be left out of negotiations,” he said.

Excerpt:

By Jim Lobe
WASHINGTON, Dec 4 2003 (IPS)

Workers’ rights guarantees in a proposed Central American trade pact must be strengthened, according to Human Rights Watch, which says it has documented systematic abuses by businesses of labour rights in El Salvador.

HRW’s report comes on the eve of a critical round of trade talks between the United States and five Central American countries on the proposed U.S.-Central America Free Trade Agreement (CAFTA).

In the 110-page report released here Thursday, the New York-based group charged that the government of El Salvador, the region’s second largest country, largely ignores and in some cases even facilitates the abuses, suggesting that labour rights provisions to be included in CAFTA must be strengthened to be credible.

“Employers in El Salvador know that if they violate workers’ rights, there is little or no consequence and the government might even help them carry out these abuses,” said Carol Pier, the report’s main author. “CAFTA must include strong tools to prevent this, but the current proposal falls far short,” she added in a statement.

The report, based in part on an 18-day fact-finding mission to San Salvador and Santa Ana earlier this year, is certain to be cited by foes of any CAFTA agreement that comes before Congress next year.

The administration of U.S. President George W. Bush hopes to conclude a deal at next week’s meeting here of trade ministers from the United States, Guatemala, El Salvador, Nicaragua, Honduras and Costa Rica.

CAFTA is designed to give Central American countries similar trade and investment preferences to those extended to Mexico under the North American Free Trade Agreement (NAFTA) and to Chile under a bilateral trade accord approved by Congress earlier this year.

While specific details of the proposed CAFTA have not been released, the administration has rejected demands by environmental activists and labour unions that it exclude countries whose laws do not incorporate core labour rights, including the right to organise, or that do not enforce those rights.

Instead, U.S. Trade Representative Robert Zoellick has insisted that Washington will not go beyond the sanctions included in the Chile agreement, which provides that nominal fines might be levied against a country if it fails to enforce its own labour and environmental laws in a “sustained or recurring” manner, whether or not those laws meet minimum international standards.

With such weak enforcement provisions, activists have sworn to defeat the accord, and Democrats in Congress, who are more likely to oppose a trade pact in a presidential election year in any event, are already lining up behind them.

Most analysts here believe the administration faces an uphill fight if it tries to get a package through Congress before next year’s elections. Not only are Democrats likely to be more unified than usual, but a number of Republicans from states or districts that are heavily tied to local textile manufacturers are certain to oppose it.

The administration will try to make it more attractive by wrapping up a free trade deal with the Dominican Republic, which has strong support among some key Democrats, and attaching it to CAFTA before submitting the whole package to Congress by next April..

But Jim Berger, editor of the ‘Washington Trade Daily’ newsletter, thinks it’s unlikely to pass before next November’s election. “The lines are clearly drawn: the Democrats are really going to fight it,” he said.

Their position is certain to be strengthened by the HRW report, titled ‘Deliberate Indifference: El Salvador’s Failure to Protect Workers’ Rights’.

It details specific cases in El Salvador’s private and public sectors, both in manufacturing and service industries, which demonstrate a consistent pattern of abuses by employers, including delaying salary payments, failing to pay overtime, denying mandatory bonuses and vacation payments, and even pocketing workers’ social security contributions that prevent them from receiving free health care.

The most pervasive abuse, the report says, is the effective denial by employers of the right of workers to organise a union despite the fact that freedom of association is guaranteed under the country’s basic laws.

Employers routinely fire union members and leaders, suspend union activists, pressure workers to renounce their membership in unions, and deny union “troublemakers,” as a result of which only about five percent of El Salvador’s workforce is organised.

If workers seek redress under the law, they face a very difficult fight. Businesses, for example, are not required to hire back illegally fired union activists; they might, and mostly do, opt to pay a nominal fine.

“Employers have come to see labour rights standards as optional, treating violations as something that can be cured, if need be, with these small payments, a cost of doing business,” according to the report.

“For workers, the result is a chill on union activity, heightened job insecurity and, at times, loss of access to affordable health care and other benefits to which they are legally entitled.”

Employers can also legally discriminate against trade unionists in hiring and suspension decisions, while the ministry of labour not only strictly enforces what the International Labour Organisations (ILO) has called “excessive formalities” in registering unions, but “regularly ignores employer’s anti-union conduct designed to thwart organising drives.”

Even if the ministry were favourably disposed toward seriously enforcing worker rights, adds the report, it lacks the resources to do so. Of a workforce of roughly 2.6 million people, the government employs only 37 labour inspectors, it says.

Even these few often fail to follow legally mandated inspection procedures, according to HRW. Often they carry out inspections without talking to workers; they fail to fine employers found to be engaging in abusive practices; and sometimes refuse to rule on issues within their mandate.

“Limited resources are a problem, but what you have in El Salvador is a serious lack of political will to protect workers’ rights,” according to Pier. “What we need here is a fundamental change in the government’s attitude toward labour rights.”

In recent years Washington has increased its own aid to labour and other government ministries in Central America precisely to enhance their enforcement powers, but these have shown little results, says the report. “More funding only helps if there’s a desire to enforce the law,” Pier noted.

The report also found that in several cases the companies involved were contractors for major U.S. apparel retailers, such as Wal-Mart, Kmart, and JC Penney. U.S. companies buy approximately two-thirds of El Salvador’s manufacturing exports.

The report called for CAFTA to not only require enforcement of local labour laws but to ensure that those laws include core labour rights, with a phase-in mechanism to ensure that countries do not receive full CAFTA benefits until they take steps to achieve those goals.

Excerpt:

By IPS Correspondents
MIAMI, Nov 21 2003 (IPS)

Ministers from 34 countries of the Americas have stated their support for a hemisphere-wide free trade agreement that allows each nation to make commitments “a la carte”, an approach that civil society groups say veils the deep differences that remain and sidesteps the urgency of fighting poverty in the region.

The conference of trade ministers from North and South America and the Caribbean -all countries except Cuba – unexpectedly ended a day early on Thursday, as consensus on the draft of the meeting’s final declaration made further deliberations unnecessary.

The United States and Brazil, co-chairs of the Free Trade Area of the Americas (FTAA) negotiations, won consensus for the watered-down document they proposed at the start of the week, allowing the two to move beyond their differences on farm subsidies, government procurement, investment and intellectual property rights.

These thorny issues are to remain confined to the sphere of the World Trade Organisation (WTO).

But representatives of labour unions, non-governmental organisations, student groups and farmers – many of whom participated in a sustainable development forum in parallel to the official negotiations this week – said they are sceptical about the new direction the FTAA has taken.

“The FTAA might have a new vision, but it is blind to the needs of poor people,” said Phil Bloomer, director of trade issues for the Britain-based humanitarian organisation Oxfam International.

The final declaration of the trade ministers in Miami hides the irreconcilable differences between individual interests on the one hand, and the urgent need to reduce poverty on the other, added Bloomer.

“We are marching with the workers because we want to say ‘no’ to this FTAA in which the biggest impose their rules on the smallest,” Fernanda Castejón, also with Oxfam, told IPS. She took part in the protest march organised in downtown Miami by U.S. labour unions on Thursday.

She condemned the sporadic violence of a handful of radical activists during the protest, saying it detracted from the very serious issues at stake in the creation of the hemisphere-wide trade agreement.

“Free trade is useful for fighting poverty if it includes measures to compensate the weakest, those who are not considered competitive. Otherwise, they will simply end up like Mexico did in the North American Free Trade Agreement (NAFTA),” said Castejón, in reference to the treaty that also involves Canada and the United States.

She referred to the report by the Carnegie Endowment for Peace, which states that instead of enjoying the fruits of economic growth as a result of NAFTA, the Mexicans lost hundreds of thousands of jobs, while newly created jobs exposed workers to unacceptable conditions of exploitation.

The Health Gap Coalition (HGC), along with other organisations, called attention to the chapter on intellectual property rights that the United States proposed for the ministerial declaration.

The U.S. protections for its pharmaceutical industry prevent the neediest in Latin America from gaining access to essential medications, says Paul Davies, HGC spokesman.

According to Doctors Without Borders (MSF, Médecins Sans Frontières), the U.S. proposal contradicts the multilateral agreement reached in the World Trade Organisation, which recognises the right of poor countries to import or manufacture less costly generic drugs in cases of public health emergencies or epidemics.

Davies pointed out that nearly two million people in Latin America and the Caribbean live with HIV/AIDS. Generic drug production has reduced the prices of the much-needed antiretrovirals by almost 98 percent, from 20,000 to 140 dollars per person per year.

A treaty that does not take this fact into account is condemning people with HIV/AIDS to death, he added.

The FTAA would cover a potential market of 800 million people, with a gross domestic product of 11 trillion dollars, but in which more than a quarter of the population is not able to meet basic needs and great social disparities persist within and amongst countries.

The talks are to end in January 2005, when the final agreement will go to the national legislatures for ratification. The accord is to enter into effect by late 2005 or early 2006 at the latest.

Excerpt:

By IPS Correspondents
MIAMI, Nov 19 2003 (IPS)

Despite their desire to return home with agreements in progress, some of the participants in the 8th Americas Business Forum expressed doubts Wednesday about the proposal for a “flexible” Free Trade Area of the Americas (FTAA) treaty..

The business sector’s position is to not stand in the way of the FTAA, which is why many entrepreneurs are trying hard to understand the new path laid out by the United States and Brazil, the co-chairs of the hemisphere-wide trade negotiations.

The Business Forum concluded Wednesday with participants agreeing to support the FTAA until the end and to make every effort to overcome the obstacles, Carl Cira, head of the Forum’s workshop committee, told IPS.

However, a dozen of the largest business groups in the United States, including high technology consortiums and major manufacturers, rejected outright the “new vision of the FTAA” proposed by Washington and Brasilia.

They issued a statement saying, “We urge negotiators at this critical time to focus on achieving a comprehensive agreement that will yield the highest level of liberalisation and rules across the board.”

The new vision for the western hemisphere that these big companies criticise is the proposal for a flexible trade agreement, what has been dubbed the “FTAA lite”, with the possibility to opt out of specific provisions.

The text was drafted by the U.S. and Brazilian governments for the 8th FTAA ministerial conference, involving the 34 governments of North and South America and the Caribbean (all except Cuba), to take place here Thursday and Friday.

The co-chairs are poised to impose a less ambitious model for a treaty than the one originally proposed by the United States nine years ago in this same city, at the Summit of the Americas.

Following the confrontations in previous weeks over farm subsidies, government procurement, investment rules and intellectual property rights, the U.S. and Brazilian delegates agreed on a draft of a minimal text that leaves these touchy issues to the World Trade Organisation.

The United States rejected the Brazilian demand to cut its massive farm subsidies, and in response announced opposition to talks on the other contentious matters.

The U.S.-Brazilian blueprint sets out a trade liberalisation process in stages, and allows each country to sign bilateral agreements, though within the general framework of the FTAA.

As stated by Adhemar Bahadian, Brazilian representative and champion of the “FTAA lite” proposal, the countries of the hemisphere “don’t have to reach an agreement” this week on the thornier issues.

Robert Zoellick, U.S. trade representative, took a similar stance, defending the strategy of bilateral agreements as giving impetus to the FTAA.

He said it must be kept in mind that the countries involved in the FTAA have different timing, but that the broader goal is to establish free trade in Latin America.

According to Cira, the relative harmony between Brazil and the United States is fostering hope that a way can be found to advance in the negotiations as the trade ministers arrive in this south-eastern U.S. city for the Thursday-Friday meetings.

Carlo Lovatelli, head of the Brazilian Agribusiness Association and part of the large private sector delegation from his country, said that the business leaders are clear that the FTAA now being proposed “is the only one with the possibility of real policies” that can be implemented.

It is substantially different from the treaty originally envisioned at the 1994 Summit of the Americas, “but an FTAA ‘lite’ is better than no FTAA,” says Lovatelli.

Representatives of the U.S. Chamber of Commerce support Washington’s new approach – being tested with several Andean countries – of establishing formal bilateral commitments, some of which go beyond the aspirations of the FTAA.

The Chamber sees as positive the potential launch of bilateral talks between the United States and Andean nations like Peru and Colombia, and possibly Ecuador and Bolivia. Agreements with these countries would be added to the one signed with Chile in September and the treaty being finalised with five Central American countries.

“But this initiative must not detract from the effort to complete the Free Trade Area of the Americas, which remains our top hemispheric priority,” cautioned the Chamber’s vice-president for international affairs, Daniel Christman.

He said bilateral agreements are tempting because they would create markets for U.S. exporters and business and job opportunities for both countries involved, but that it would also be tempting for these countries not to make the sacrifices needed for the FTAA.

The U.S. Chamber of Commerce is also insisting that the talks must include the issues of intellectual property protections and investment rules – which are taboo for the Brazilian negotiators.

The Chamber also maintains a cautious attitude towards some of the bilateral discussions underway. Christman said pressure would be put on the Andean governments to resolve pending investor disputes before launching negotiations early next year.

Despite their spirit of persistence, the differences between the corporate interests of the various countries have come to the forefront.

“FTAA lite” brings with it the danger that the American business community will lose its enthusiasm for free trade, said Mickey Kantor, who served as trade representative under former U.S. president Bill Clinton (1993-2001) and negotiator of the North American Free Trade Agreement (NAFTA), comprising Canada, Mexico and the United States.

On another front, the powerful National Industrial Confederation of Brazil is unrelenting in its criticism of U.S. trade protectionism and insists that if subsidies and non-tariff trade barriers remain in place, the promise of greater access to the North American markets will be broken.

As such, the business leaders of the Americas on Wednesday left the negotiating table served up for the trade ministers, and their message is as ambiguous as the flexible agreements and multi- and pluri-lateral pacts being sought by the governments.

What the Business Forum is apparently saying is: “We are with you, but we don’t all necessarily agree with everything you are seeking.”

Excerpt:

By Emad Mekay
MIAMI, Nov 19 2003 (IPS)

The Free Trade Area of the Americas (FTAA), an ambitious plan for a common market of the 34 countries in the western hemisphere, might be fading from its original vision articulated here nine years ago, a leaked document showed Wednesday.

The original plan envisions a common market for the region by Jan. 1, 2005 but a copy of the final draft declaration gives countries the freedom to pick and choose their free trade obligations.

It is a change some observers are calling a second victory for the developing countries opposed to the U.S. agenda, following the failure of the Cancun round of talks of the World Trade Organisation (WTO) in September.

Trade ministers from the 34 countries are expected to sign the declaration in this Florida State city by Friday.

In what is seen here as a small victory for developing countries from South America’s Mercosur group of Brazil, Argentina, Paraguay and Uruguay, the draft speaks of how countries can commit only to certain obligations of the embattled deal.

Another leaked document on the position of Canada, Mexico and Chile, three countries that already have free trade deals with the United States committing them to a broader range of trade in goods and services, appears to drop their initial opposition to the transformation of the FTAA.

At the start of the week-long talks here Sunday, the three nations said the deal should remain as comprehensive as originally visualised in order for it to benefit all countries. It is not clear yet why they shifted their position.

Trade ministers are arriving in this beach city to forge ahead with official talks Thursday and Friday towards the pan-American trade deal that would encompass 800 million consumers from Argentina to Canada.

But discussions on the original plan snagged on disagreements between the United States and Brazil, the co-chairs of the meetings, over the scope of the deal.

The United States has been the most vocal country calling for the opening up of Latin American markets, but Brazil, the largest economy in South America, says that Washington should be prepared to do the same.

Yet the United States refuses to cut its domestic farm subsidies, which Brazil says undercut poor farmers by pushing prices to ever-lower levels, or to change its anti-dumping laws, which the South Americans say raise tariffs and other obstacles to Brazilian exports like citrus and steel.

Brazil and other countries have also painted the deal as an avenue for mammoth U.S. corporations to pry open Latin American economies.

They have refused to accede to U.S. demands to widen the FTAA to include giving access to U.S. services or to discuss government procurement issues, foreign investment and intellectual property rights, except under the World Trade Organisation (WTO), where the developing nations have a better negotiating position.

These countries, now sitting next to formidable trade allies like China, India and South Africa in the WTO, have a better chance of resisting pressure from rich nations like the United States, Japan and the European Union.

To the dismay of rich nations vying for more markets for their products, the alliance of developing countries helped bring the WTO talks in Cancun to a dead halt, partly because rich nations failed to budge on cutting their whopping farm subsidies.

In an echo of southern nations’ newfound assertiveness, the final draft of the FTAA, seen by IPS, leans clearly towards Brazil’s position by allowing countries to opt out of certain parts of the proposed FTAA and to discuss others.

“Negotiations should allow for countries that so choose, within the FTAA, to agree to additional obligations and benefits,” says the draft. “One possible course of action would be for these countries to conduct plurilateral negotiations within the FTAA to define the obligations in the respective individual areas.”

The draft also talks of working to reach an agreement on market access by Sep. 30, 2004, without committing to a date to resolve other sticky points like government procurement and foreign investment.

Insiders say the transformation of the plan into what is now known as “FTAA lite” constitutes a defeat for the U.S.’ corporate-backed vision of trade in the western hemisphere, and a victory for developing countries’ solidarity.

“What that demonstrates is that if developing countries are assertive, they can change the rules,” said Phil Bloomer, chief of the trade campaign of the international charity organisation Oxfam.

One source close to talks said the draft also signalled the increasing weight of the Mercosur block, which has forced the United States to back down to save public embarrassment.

“The Americans realised the realpolitik when they are negotiating with Mercosur, and that this is as good as it gets right now,” one source said, insisting on anonymity.

“They (the Americans) did a cost-benefit analysis and said ‘let’s have a lot of this constructive ambiguity (in the draft) or risk a major fight with Brazil and the Mercosur in another trade meeting, leading to a collapse’. And I think they have taken the first option.”

Mercosur accounts for 65 percent of the 34 nations’ gross domestic product (GDP) aside from those countries included in the North American Free Trade Agreement (NAFTA) – Mexico, Canada and the United States.

Brazil, a country of 180 million people, has the world’s 10th largest economy.

U.S. businessmen have been particularly itchy to open up Brazil’s markets as the country has maintained a high level of protection, including restrictions on foreign investment.

If endorsed, ”FTAA lite” means U.S. companies will have to wait longer than planned before they can get their hands on major Latin American markets ¡- if at all.

Excerpt:

By Emad Mekay
MIAMI, Nov 18 2003 (IPS)

The United States officially unveiled its new “incremental approach” to global trade Tuesday, announcing a string of bilateral deals with Latin American nations at a meeting that was supposed to achieve a comprehensive pan-American trade agreement.

Critics warned that Washington is resorting to the bilateral deals to try to isolate Brazil and other countries that have voiced concerns over U.S. economic hegemony and that the new agreements could also harm developing countries’ economies.

U.S. Trade Representative Robert Zoellick announced the United States is launching free trade talks with Colombia, Peru, Ecuador and Bolivia. Talks with Panama and the Dominican Republic were announced separately later in the day.

The U.S. plan would structure talks to formally begin in the second quarter of 2004, initially with Colombia and Peru.

“Negotiating an FTA (free trade agreement) with the Andean countries is a logical step under the administration’s promotion of competitive liberalisation in the hemisphere,” wrote Zoellick in a letter to Congress announcing the debut of the talks.

Ecuador and Bolivia will be included in the package of deals but their governments are still preparing domestic policy changes to ready their economies for the agreements, including changes in laws that protect workers’ rights – widely interpreted to mean relaxing those protections – and resolving current disputes involving U.S. investors.

Zoellick also met Tuesday with five Central American trade ministers to advance the final round of negotiations for the U.S.-Central America Free Trade Agreement (CAFTA) in December in preparation for the agreement to be enacted in 2004.

Trade ministers and officials from the 34 Americas countries (except Cuba) are gathered in this beach city to forge ahead with talks towards a pan-American Free Trade Area of the Americas (FTAA).

But initial talks in this eighth round of negotiations have snagged on a disagreement between the United States and Brazil over the scope of discussions.

Washington refuses to cut domestic farm subsidies, which Brazil says undercut poor farmers by pushing prices of farm goods to ever-lower levels, and to relax its anti-dumping laws, which the South Americans say raise tariffs and other obstacles to Brazilian exports like citrus and steel.

Under the free trade deals announced Tuesday, the six countries would be required to adopt stronger protection of intellectual property rights, drop high tariffs on agricultural goods, hygiene regulations and other practices Washington says discourage trade, like protective licensing practices or limitations on access for providers of services.

Business groups hailed the announcement.

The U.S. Chamber of Commerce, which represents more than three million businesses and organisations, called the move an ”economic shot in the arm for the U.S. and the Andean region” that will boost trade in the western hemisphere.

“It will create new markets for U.S. exporters and generate a broader range of business and job opportunities from Lima, Ohio to Lima, Peru,” said Daniel W. Christman, the chamber’s senior vice president.

Opening up the services sector would most benefit U.S. companies working in the electric power, air cargo, electronic commerce, telecommunications, banking and insurance businesses.

Although the Latin American markets are small, they could prove to be fast growing ones for U.S. companies. Sales by U.S. services companies in Colombia alone were three billion dollars in 2000, nearly a six-fold increase from 519 million dollars in 1992.

Civil society groups warned the deal could hurt the less developed southern countries in the face of the much stronger U.S. economy.

The agreements, they added, will do more to boost U.S. sales in Latin countries than increase Latin American sales in the United States because most Latin exports already enter the U.S. market duty free.

“I am concerned that the bilateral agreements may ultimately destroy the few benefits that exist in a multilateral process,” said Eric Dannenmaier of the Tulane Institute for Environmental Law and Policy at Tulane Law School in New Orleans.

Dannenmaier told media that bilateral deals could accomplish many of the same trading goals of large economies as would region-wide agreements, like opening up foreign investment and reducing trade barriers, without the larger nations having to face coalitions of developing countries.

“If you are afraid of the FTAA, then you should be very afraid of the bilaterals,” said Dannenmaier, who is attending a civil society group forum at the meetings in Miami.

The international charity organisation Oxfam said the proposed rules in the bilateral agreements could erode development prospects in the hemisphere.

For instance, unfair patent rules will reduce poor people’s access to affordable medicines while unregulated opening of agricultural markets will stop governments from protecting their farmers from unfair competition and U.S. dumping, the group argues.

Oxfam’s Trade Campaign Manager Phil Bloomer says existing bilateral and regional pacts, such as the North American Free Trade Agreement (NAFTA) and free trade deals with Chile and Singapore, are not good models for development and the reduction of poverty..

“NAFTA has failed the 45 million Mexicans who remain in poverty,” Bloomer said. “The danger is that these new bilateral deals will extend the same bad deal to millions more.”

Despite concerns from civil society and other grassroots groups assembling here in Miami, where official talks will be held Nov. 20-21, U.S. businessmen vowed to press ahead with the more comprehensive FTAA.

Excerpt:

By Emad Mekay
MIAMI, Nov 18 2003 (IPS)

A decade-old trade deal between Canada, the United States and Mexico did not help the latter boost its economy, create jobs or rejuvenate its agricultural sector as promised, say two studies released here Tuesday.

The North American Free Trade Agreement (NAFTA) came into effect in 1994 with officials from the three countries promising it would usher in a new phase of economic prosperity for all, particulary for the only developing economy involved.

But with NAFTA touted as the blueprint for the controversial Free Trade Area of the Americas (FTAA), a common market of 800 million consumers in 34 countries from Argentina to Canada (excluding Cuba) the earlier deal has come under greater scrutiny.

The findings of the two reports released here are particularly relevant now as ministers from the 34 countries, along with business, academic and civil society leaders, have gathered in this Florida State city this week to discuss plans to create the FTAA by Jan. 1, 2005.

At its launch, officials promised that NAFTA would create some 200,000 new U.S. jobs each year, spark higher wages in Mexico, initiate an environmental clean-up and boost the health of citizens.

The reports say the deal failed to fulfill most of these promises.

“NAFTA has not helped the Mexican economy keep pace with the growing demand for jobs,” says ‘NAFTA’s Promise and Reality’, by the Carnegie Endowment for International Peace, a Washington-based think tank.

While foreign direct investment in Mexico led to the creation of 500,000 manufacturing jobs from 1994 to 2002, the country lost at least 1.3 million jobs in the agricultural sector alone, where one-fifth of Mexicans still work, adds the document.

The report says that the real wages of most Mexicans today are lower than they were when NAFTA took effect. “Despite predictions to the contrary, Mexican wages have not converged with U.S. wages.”

The other report, ‘Unfair Trade’, released by Public Citizen and the Global Resource Action Centre for the Environment (GRACE), says that U.S. and Mexican farmers are struggling to survive as a result of NAFTA.

“Family farmers in both the U.S. and Mexico are suffering needlessly because of this agricultural crisis,” said Wenonah Hauter, director of Public Citizen’s Critical Mass Energy and Environment Programme.

“It is inconceivable that this situation can continue to be ignored by the government and corporate leaders who held up NAFTA as a saviour to the Mexican farmer.”

According to ‘Unfair Trade’, NAFTA has eliminated 99 percent of Mexico’s agricultural tariffs, meaning, for example, that since 1994, the amount of U.S. corn dumped – sold at subsidised prices – on the Mexican market has increased 15-fold.

Similarly, the amount of U.S. beef going into Mexico has doubled, poultry has tripled and pork imports have quintupled, adds the report.

“Farms by the hundreds of thousands have been driven into bankruptcy, creating havoc in the Mexican countryside,” the document says. “Three-fourths of the Mexican population now lives in poverty, up 80 percent since 1984.”

The United States disputes such figures, arguing that most U.S. corn sold to Mexico is yellow corn used as livestock feed while Mexican farmers mostly grow white corn for human consumption.

Washington also says that Mexican farm production increased 50 percent from 1993 to 2001, including output of pork, beef, chicken and vegetables.

But Lori Wallach of Public Citizen says figures from the U.S. Trade Representative (USTR) can be misleading.

“When they talk about farm production, they are talking about volume. We are talking about farmers,” she said, referring to how NAFTA led to multinational companies buying up farmers’ lands.

Those companies produce more in terms of volume, but that has come at the expense of hundreds of thousands of small farmers who have lost their livelihoods, Wallach added.

The reports point to another negative effect of NAFTA. More than 38,000 small U.S. farms have gone out of business since the deal was implemented, particularly in the winter vegetable industry.

Since 1994 the number of tomato farms in Florida has fallen from 230 to fewer than 100, says ‘Unfair Trade’.

The reports’ findings contradict a brief report released Monday by the U.S. government that argues NAFTA did help the Mexican economy.

“NAFTA has resulted in expanded Mexican exports, higher wages for Mexican workers, less poverty, more foreign investment and a stronger agriculture sector,” said the report from the USTR office.

Washington says one of every five people in Mexico is today employed in export-oriented jobs and that one-half of the 3.5 million new jobs generated in Mexico in 1995-2000 resulted from NAFTA and export growth.

The Carnegie report says that predictions of the benefits of free trade deals like the FTAA are empty promises.

“Trade liberalisation is facing a crisis of legitimacy among people around the world, from rural farmers in Latin America to cotton producers in Africa, to manufacturing workers in the United States and Europe,” it said.

It instead advised governments to “stop making empty promises” that trade will bring news jobs, cleaner environments, or stem the flow of illegal migration.

“Free-trade agreements should not be thought of as an end in themselves; nor should they be loaded with unrealistic expectations,” said ‘NAFTA’s Promise and Reality’.

But it appears the advice is not being heeded. Tuesday, U.S. Trade Representative Robert Zoellick announced the launch of new bilateral trade talks with four Latin American countries – Ecuador, Colombia, Bolivia and Peru.

The banner behind him read: “Trade, Hope, Opportunity”.

Excerpt:

By Emad Mekay
MIAMI, Nov 17 2003 (IPS)

A high-profile meeting to discuss a pan-American trade zone opened here Monday amidst tight security and doubts about the fate of the embattled plan.

Thousands of participants are in this Florida State beach city for talks on the Free Trade Area of the Americas (FTAA), a regional pact that would encompass 34 countries and stretch from Argentina to Canada to include some 800 million consumers.

Joining trade ministers and officials are thousands of the FTAA’s opponents, who themselves have become divided by a proposal to engage them in the official process.

Parts of downtown Miami were blocked to regular traffic and businesses closed around a handful of luxury hotels where trade ministers, businessmen and civil leaders are meeting for the eighth round of the trade talks, an ambitious project to expand the North American Free Trade Agreement (NAFTA) of Canada, Mexico and the United States.

Policemen in grey overalls and weapons strapped to their thighs dotted the area or stood firmly behind barricades as helicopters hovered above. Only limousines, emergency vehicles and participants with identification badges were visible in the area.

But outside the security zone thousands of protesters and activists from environmental groups, labour unions and student and farmers’ organisations were gathering for the event, saying they plan dozens of protest events, including street marches and a major demonstration.

Many carried banners denouncing the FTAA as an attempt at U.S. hegemony while others complained that the agreement would impoverish farmers and workers, and degrade the environment in both rich and developing nations.

The protesters, who plan dozens of workshops, seminars and teach-ins, face their own test in Miami.

In 1999 these groups left their mark on the global trade and financial arena for the first time, their protests in Seattle helping to defeat negotiations of the World Trade Organisation (WTO).

That is why FTAA organisers will for the first time host a meeting here between civil society groups on one hand and business executives, academics and government officials on the other.

Organisers are calling the event, ‘Americas Trade and Sustainable Development’ (ATSDF), an “unprecedented milestone in the FTAA process”.

But many civil society groups, including Public Citizen and the International Forum on Globalisation, have already boycotted it, calling the gathering a U.S. attempt to whitewash the trade deal.

Others that will attend complain that their recommendations will be non-binding and that civil society participants have been carefully selected to ensure support for the official process.

Participating groups include Transparency International, Oxfam America, Institute for Agriculture and Trade Policy and Doctors Without Borders, among many others.

The official meetings, which end Friday, include a parallel two-day gathering of business leaders from the western hemisphere. The executives will present their proposals to trade ministers, who are due to start formal meetings Wednesday.

Topping the ministers’ agenda is a budding trade conflict between the United States, the main force behind the draft FTAA, and South American countries led by Brazil, the largest economy in Latin America, over the scope of the agreement.

The current round of negotiations is a critical point for both developing countries and for rich nations like the United States and Canada, if they are to sign a deal by Jan. 1, 2005 as planned.

The developing countries, which banded together and blocked the U.S. agenda – leading to September’s failed global trade talks in Cancun – are again resisting what they say is a limited corporate-backed U.S. trade plan.

Facing an election year in 2004, the administration, led here by savvy U.S. Trade representative Robert Zoellick, is already refusing to meet at least two of Brazil’s demands.

Washington refuses to cut domestic farm subsidies, which Brazil complains undercut poor farmers by pushing prices to ever-lower levels, and to change its anti-dumping laws, which the South Americans say raise tariffs and other obstacles to Brazilian exports like citrus and steel.

Despite early lobbying and pressure from Washington, unofficial meetings were not off to a positive start. Attempts by the United States and Brazil to reach a compromise hit a snag Sunday night.

The two trade giants said they had reached an understanding that would allow nations to choose which parts of the deal they would commit to and which they could ignore.

Chile and Canada made a counter-proposal demanding that countries unwilling to accept tariff cuts should be penalised, rather than being able to ignore the measures.

Deputy trade officials ended the meeting early after failing to reach a consensus.

Adhemar G. Bahadian, the Brazilian who is co-chairman of the meeting, told the ‘Miami Herald’ the meeting was “inconclusive”.

“To return to the previous situation is to go back to the impasse,” he said.

Excerpt:

By Emad Mekay
WASHINGTON, Nov 15 2003 (IPS)

The United States might be trying to re-write its strategy towards a threatened trade deal in the Americas by adding more pressure tactics to its old technique of doling out economic benefits to Latin American countries.

Trade ministers from 34 countries will meet next week in Miami for the eighth ministerial meeting of the Free Trade Area of the Americas (FTAA), a pan-American deal that would create the largest trading bloc in the world stretching from Canada to Argentina – with the notable exception of Cuba – by January 2005.

But the meeting is seen on the road to an impasse as the United States and Brazil, co-chairs of the current round of talks, lock horns over the scope of the negotiations.

Brazil, on behalf of some South American countries, wants to exclude areas such as copyright and patent protection, investment and government procurement and leave them for broader global trade talks under the auspices of the World Trade Organisation (WTO).

The United States refuses to discuss agriculture subsidies, which South American countries say are depressing crop prices and creating unfair competition with U.S. farming companies.

U.S. farmers also oppose talks aimed to reduce domestic subsidies within the FTAA because they complain that would not oblige other competitors from developed countries like the European Union (EU) and Japan to make similar cuts.

Similar disagreements brought global trade talks to a resounding halt in Cancun, Mexico in September, when 21 developing countries banded together to protest rich nations’ failure to drop their hefty agricultural subsidies. The talks eventually collapsed.

Fearing a re-run of the Cancun episode in Miami, and under pressure from U.S. corporations, Washington has recently sought to modify its tactics without budging on its original demands.

The United States now appears more aggressive and threatening as it seeks to isolate the opposing camp in Latin America by forging bilateral trade agreements.

Last week, Peru said that U.S. Trade Representative (USTR) Robert Zoellick would announce in Miami the start of bilateral free-trade talks between the two countries, while Colombia also said it will announce similar talks with Washington soon.

Several businessmen and business associations in the United States are reporting that Washington’s attempts to sign bilateral trade deals with other countries in Latin America is bearing fruit, and that deals with Ecuador, Panama and Bolivia will also be announced in Miami.

Washington is currently negotiating a U.S.-Central American Free Trade Agreement (CAFTA) with Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua.

On Aug. 4, the administration notified Congress it intends to also initiate negotiations with a sixth nation, the Dominican Republic, and to seek to integrate it into the CAFTA.

On Sep. 3, President George W. Bush signed into law a free trade agreement with Chile, the first such deal with a South American country. Chile joined Mexico and Canada as the U.S.’ hemispheric free trade partners.

“The strategy is all about how to corner Brazil to make them feel they will be isolated if they don’t go along with the kind of FTAA that the U.S. government wants,” said Sarah Anderson a fellow at the Institute for Policy Studies in Washington.

“That’s because I think they see Brazil as really the crown jewel of the Americas.”

With the largest economy in South America and a population of nearly 180 million people, Brazil has staunchly protected its economy, retaining more restrictions on foreign investments than most other Latin American nations.

Its government wants trade concessions from Washington in exchange for supporting some parts of the FTAA

”Brazil is the place the U.S. companies really want opened up,” Anderson said in an interview. “All of this talk about bilateral agreements … is really about cornering Brazil. That’s what they are after. They don’t care about having a bilateral with (a small country like) Panama, for example.”

Rick Rowden, policy director of ActionAid USA, told IPS that Washington was adopting a country-by-country approach because the FTAA has become so big it threatens to generate a huge backlash both at home and in South American countries.

Essential Action Co-director Robert Weissman called the U.S. piecemeal strategy alarming.

“The (Latin) countries enter these negotiations with no capacity or no political strategy to extract anything from the U.S. except for very minor market access concessions, and with near desperation … they claim success just by virtue of having negotiated an agreement with the U.S.,” he said in an interview.

But isolating Brazil is not the only new U.S. tactic. Earlier this month, Zoellick called for a ”mini-ministerial” meeting to try to reduce opposition to the deal ahead of Miami.

The meeting was criticised for ignoring Venezuela, a major country in South America that has previously voiced concerns about the deal, while inviting nations that appeared receptive of the U.S. position, like Chile, Colombia and Trinidad and Tobago.

Zoellick has also tried to enlist the backing of the influential Latino U.S.. business community, many of whose members have strong business ties in their countries of origin.

Last week, the U.S. official held a meeting for Latino businessmen in the White House to launch the Latino Coalition for Free Trade, a group expected to lobby for the FTAA in South America.

More than one hundred prominent Latino businessmen and community leaders from across the United States attended.

“The future of our hemisphere depends on the strength of our commitment to free markets, economic opportunity and democracy,” Zoellick told them.

Critics also say U.S. negotiators are resorting to so-called trade ”capacity building”, training or funding for officials in partner nations that often results in indoctrinating the officials in U.S. trade policies, making them more readily adaptable to a new trade regime.

Critics say that kind of training puts the rules of agreements like the FTAA or the North America Free Trade Agreement (NAFTA) above local decision and policy making.

“That’s the problem that we are faced with – the lack of any possibility of developing real policies that are rooted in the needs of the people in terms of their democratic rights,” said Tony Clarke of the Ottawa-based Polaris Institute in an interview.

“It’s a change in the way in which governance occurs because every time a major social or environmental public policy or programme is put forward, it must be put through that test to see whether it is NAFTA proof-or FTAA-proof.”

Excerpt:

By IPS Correspondents
UNITED NATIONS, Nov 12 2003 (IPS)

Women’s groups have handed the Bush administration failing grades for its treatment of issues concerning women in ongoing talks to create the Free Trade Area of the Americas (FTAA).

The administration’s rhetoric was given an ‘F’ while its actions were scored ‘I’ (incomplete) in the ‘Global Women’s Issues Scorecard’ released Wednesday.

The first scorecard published in August before World Trade Organisation (WTO) meetings in Cancun included analysis of the administration’s proposals on agricultural subsidies and their impact on women farmers in developing countries. The Scorecard issued a ‘C’ for rhetoric and an ‘F’ for actions.

”In the WTO discussions, there was at least some recognition that trade policies affect women and men differently and an understanding of women’s critical role in food production,” said June Zeitlin of the Women’s Environmental Development Organisation (WEDO) one of the groups scoring the administration.

”Yet, in all the FTAA discussions so far we have been unable to find any direct reference … to women’s concerns or the specific impact on women, either in the market or in the home.”

Modelled after the North American Free Trade Agreement (NAFTA) between the United States, Canada and Mexico, the FTAA is considered by the administration of President George W. Bush a successful example of development.

Yet opposition is growing to the plan to integrate the markets of 34 nations in the Americas – excluding Cuba – both developing and developed economies.

Led by Brazil, South American governments in particular are insisting that Washington drop its support to U.S. farmers and keep issues like patent protection and foreign investment to discussions within the WTO.

In May, the Scorecard quoted Bush on agricultural subsidies and the WTO. “We must also give farmers in Africa, Latin America and Asia … a fair chance to compete in world markets. When wealthy nations subsidise their agricultural exports, it prevents poor countries from developing their own agricultural sectors,” the U.S. president said.

“So I propose that all developed nations … immediately eliminate subsidies on agricultural exports to developing countries so that they can produce more food.”

Ironically, the 2002 Farm Bill raised U.S. farm subsidies by 80 percent to 100 billion dollars.

”Massive increases in U.S. farm subsidies in the 2002 Farm Bill belie Bush administration rhetoric backing lower agricultural subsidies, fair trade and reducing the number of people living in poverty – the majority of whom are women,” said the Scorecard..

Although Washington has not spelled out how it believes the FTAA would affect women, the Scorecard quotes U.S. Trade Representative Robert Zoellick saying, ”free trade and openness benefits everyone and provides opportunity, prosperity and hope to all our peoples”.

Zeitlin told reporters Wednesday in a conference call, “while the administration touts the economic benefits of FTAA as improving living conditions throughout Latin America, they offer little evidence to back up their claim”.

“Indeed, women’s experience under NAFTA, particularly poor women, has been to the contrary.”

Joining Zeitlin in the telephone media briefing was Eleanor Smeal of the Feminist Majority and Jodi Jacobson of the Centre for Health and Gender Equity. They vowed to take part in demonstrations in Miami next week, where trade ministers will hold FTAA talks.

Zeitlin said free trade has severely marginalized workers in the United States and abroad. Although plant closings and displacement of workers might not be news, the news is that benefits for workers in Latin America and the Caribbean are non-existent, Zeitlin said.

”Let’s take the example of the export processing zones or maquiladoras, which employ primarily women in Mexico and Central America.”

“Despite working very long hours, the majority of women workers still live in poverty because jobs in the maquiladoras provide very low pay, and generally no benefits and few health and safety protections despite often dangerous working conditions,” she said.

Others agree the new agreement would exacerbate those problems.

”The FTAA would expand the reach of NAFTA, bringing low-wage jobs with no real protections for workers’ rights for the rest of the hemisphere,” says the International Gender and Trade Network.

”Women workers need trade policies that protect their rights as women and as workers and improve their living conditions … A fair trade alternative to the current U.S. proposal would include mechanisms to ensure that workers’ rights and environmental protections are being improved in trading nations, not undermined,” adds the group’s website.

Women’s groups are further worried by the FTAA call to open up the provision of public services to the “free market”.

”This could open up education and health services to private sector competitors,” said Zeitlin.

”While the approach may seem ‘efficient’ there is already a substantial body of evidence that it doesn’t work … Privatisation of basic needs such as water and health care has led to price increases and denial of access to the poor.”

“FTAA will encourage the shift of authority away from government and to the private sector for those very services that women and girls depend on,” she added.

Excerpt:

By Emad Mekay
WASHINGTON, Nov 10 2003 (IPS)

A short-notice meeting called by the United States last weekend for trade ministers from the Americas might have saved U.S. officials a major upset a la Cancun when ministers meet again next week, but analysts say the gathering did nothing to change positions on the main issues blocking a regional trade deal.

While officials described the meeting between U.S. Trade Representative Robert Zoellick and trade ministers from 16 Latin American nations over the Free Trade Area of the Americas (FTAA) as ”flexible” and ”useful”, they gave little indication of concrete improvements in an impasse that has already taken down global trade talks in Cancun in September.

“I think we now have a good basis for a successful meeting in Miami,” Brazilian Foreign Minister Celso Amorim told reporters in a conference call Saturday.

“Of course, the substantive issues are not resolved, but the general approach is one that, maybe with observations that should be included, will enable us to move forward.”

The trade agenda of the administration of U.S. President George W. Bush suffered a major setback during the World Trade Organisation (WTO) negotiations in the Mexican resort in September as developing countries banded together to oppose trade rules they said harm poor nations, especially rich countries’ agricultural subsides for their farmers.

Concerned that developing nations in Latin America could follow the same tactics during the FTAA talks in Miami the week of Nov.17, Washington called the ”mini-ministerial” here last weekend.

The FTAA will encompass 34 countries from the western hemisphere – all except Cuba – and is modelled after the controversial North American Free Trade Agreement (NAFTA) between the United States, Mexico and Canada.

Washington has been pushing for a signed deal by January 2005 despite strong opposition from civil society groups, some economists and some government leaders.

”It is going to be a challenge,” said a senior U.S. official in another conference call after the weekend meetings. ”It is always a challenge when you have 35 countries sitting around and having to agree on every single word in a document.”

“But I feel certainly better about it today than I did two days ago because we’ve got some useful insight.”

Washington wants the FTAA to include rules covering, among other things, government procurement, foreign investment and lower trade tariffs, especially on manufactured goods.

Latin American governments, led by Brazil and Argentina, say these issues must be left for talks in the WTO’s multilateral setting, and must be tied to reducing U.S. protectionism, especially measures to protect its farmers.

”The U.S. wants all the issues (included) that ironically do really not belong to a trade agreement,” said Mark Weisbrot, an economist with the Centre for Economic and Policy Research in Washington.

”They want intellectual property so they can try and force countries to adopt U.S.-styled patent laws; they want the investment rules to give their corporations more power to sue governments or anything that infringes on their profits and they want the procurement rules, but they don’t want to talk about agriculture,” he added in an interview.

Including more than 800 million people throughout the hemisphere, the FTAA will create the largest free-trade area in the world – a potential goldmine for major U.S. and Canadian corporations selling goods and services.

But Brazil – the largest economy in Latin America – and other countries have locked horns with the United States over Washington’s refusal to discuss its legislation on anti-dumping rules against imported products, subsidies that protect farmers and non-tariff barriers – such as health and sanitary standards – that it imposes on imports.

Brazil, whose country’s exports were particularly stung by the U.S. farm bill and recent steel tariffs, has previously described the FTAA as an “annexation” of Latin American economies to that of the United States.

Venezuelan President Hugo Chavez, whose country was dropped from the mini-ministerial, has also questioned the benefits of the U.S.-backed FTAA to Latin America’s cashed-strapped countries.

Some economists and activists say the deal would further erode environmental protection, workers’ livelihoods and human rights. Many of them see the deadlock between Washington and some developing countries dragging on in Miami, even after last weekend’s meeting.

”Everything that I have seen from Brazil has said that the United States is refusing to offer anything that’s meaningful for Brazil or Argentina, especially around market access and subsidy reduction,” said Vicki Gass of the Washington Office on Latin America (WOLA).

Pointing to recent U.S. polls that showed Americans also doubting so-called ”free trade” agreements because of the loss of domestic jobs after NAFTA, Weisbrot predicted the Miami talks will not succeed because the FTAA does not benefit the United States or Latin American countries.

Activists say more than 765,000 jobs have disappeared from the United States as a result of NAFTA.

”I cannot see it (Miami) going very far at all because this is a bad deal really for everybody and for the majority of people in all the countries, including our own,” Weisbrot said. ”It’s a net loss for South America. And I don’t see any reason why they would agree to it.”

But Gass, while agreeing the deal could harm Latin American economies, doubted whether the countries could long resist Washington.

Latin American nations, she said, could be subject to arm-twisting because many of them have already signed on to plans to liberalise their economies, making them indebted to the World Bank and the International Monetary Fund (IMF), which opens them up to Washington’s influence.

Those nations precarious positions are compounded by their ruling elites who, often in the past, sided with Washington and U.S. companies as long as they were ”skimming off” at the expense of their own people.

Gass also argues that the White House is so influenced by the interests of U.S. corporations that it could overlook the obvious damages from the deal to labour rights at home and the environmental and social damage in other countries.

”They are going out for the interest of their multinational corporations, and Bush wants to win the (2004) elections,” she said. ”They’ll do all the protectionism that they need and continue their policy of, ‘do as I say not as I do’.”

Excerpt:

By Paul Weinberg
TORONTO, Nov 4 2003 (IPS)

The cautious approach of Brazil and other Latin American governments towards expanded free trade in the Americas results in part from the political and economic price that Canada paid for greater trade access to the gigantic U.S. market, says an expert here.

The failure of Canadian negotiators to win an exemption from U.S. trade law for this country’s manufactured goods and commodities in two trade deals continues to haunt leaders in Latin America, says Ken Traynor, a spokesperson for Common Frontiers, part of an alliance of unions and citizens’ coalitions opposed to the Free Trade Area of the Americas (FTAA).

”The Brazilians sit there and they know that history as well. They read all of the same books; they have watched it happen, and they say, ‘we are trying not to make the mistakes that were made in the past’,” says Traynor.

Central and South Americans, he adds, understand that notwithstanding existing free trade agreements, their home-grown and developed products cannot compete fairly with equivalent U.S. products in the lucrative U.S. market because of protectionist measures adopted by the Congress and President George W. Bush.

Latin Americans know “just how anti-dumping and countervailing duties have cost them billions of dollars worth of exports to the United States, and they have a message from the Bush administration that (it is) willing to subsidise agricultural exports like crazy,” adds Traynor in an interview.

Trade ministers from the 34 nations of the Americas (minus Cuba) are scheduled to meet in Miami later this month for further talks on the FTAA, an accord that will produce a free trade zone of 800 million people whose countries produce one dozen trillion dollars in goods and services.

The agreement, which is supposed to be finished by 2005, expands on the existing North American Free Trade Agreement (NAFTA) signed by Canada, Mexico and the United States in 1992.

The success of U.S. trade law at keeping Canadian products like softwood lumber out of the U.S. market under NAFTA has caused major Canadian business groups, like the Canadian Council of Chief Executives, to call for more Canada-U.S. economic integration.

But Lawrence Herman, a Toronto-based international trade lawyer and supporter of the current free trade regime, says no political will exists in either Ottawa or Washington for such a re-negotiated deal. If it did, Canada, as the smaller partner in both population and economy, would lose the ability to establish its own trade policy.

”There are economic advantages to being part of the United States. But it is not going to happen,” said Herman in an interview.

At a conference here last month, ‘Canada, Free Trade and Deep Integration in North America’, union-based economists provided plenty of statistics to demonstrate the impact of free trade.

The largely foreign-based auto manufacturers, for instance, have been shifting their investment and production from Canada to the southern United States and Mexico, where unions are weaker or non-existent and labour costs are lower.

”In 1999, we provided 16 per cent of all vehicles sold in North America; now we are down to 13 per cent and that will fall further,” said Jim Stanford, an economist with the Canadian Auto Workers.

Canada has already lost three of a dozen auto industry plants and more closures could be on the list next year, adds Stanford.

Centred in the southern Ontario industrial heartland, the Canadian auto sector employs thousands of people both in manufacturing vehicles and making and supplying auto parts and steel.

Interventionist measures that allowed previous Canadian governments to stimulate and encourage domestic companies or branch plants of foreign-based firms to expand their job-producing operations here have largely been dismantled because they contravene international trade rules.

Supporters of free trade in the late 1980s, like then Prime Minister Brian Mulroney who negotiated NAFTA, argued that reducing tariff and other barriers to trade and investment and a single North American market would encourage Canadian manufacturers to be more ”productive and efficient”.

Initially, exports of Canadian products to the United States rose from 25.7 per cent of nominal gross domestic product (GDP) in 1989 to 45.5 percent of GDP in 2000, says Andrew Jackson, senior economist with the Canadian Labour Congress.

But the government’s own analysis shows that 90 per cent of the strong export growth after NAFTA and the first U.S.-Canada free trade deal stemmed from factors outside of those agreements.

These include, says Jackson, the strong growth of the U.S. domestic market, a rising U.S. trade deficit with the rest of the world and a significant drop in the value of the Canadian dollar that made the country’s products competitive.

Canada’s important resources and auto sectors were already becoming more export-oriented before the first trade deal was signed in 1988, adds Jackson.

What has changed since then is the tendency of larger Canadian goods producers to become more North American oriented, rather than concentrating on the smaller domestic market.

”Deeper integration of the manufacturing sector in the North American economy has done little to decisively shift the structure of (Canada’s) industrial economy away from natural resources and relatively unsophisticated manufacturing towards the more dynamic and faster growing ‘knowledge based’ industries,” adds Jackson.

By aligning itself with Washington as a free trade advocate at the upcoming talks in Miami, Canada will be out of step, as nations like Brazil take tougher stands in areas neglected in Canada’s FTA and NAFTA negotiations, says Traynor.

”The dominant political view (in Ottawa) is how we engage and relate to both U.S. economic and political power,” he adds.

Excerpt:

By IPS Correspondents
NEW YORK, Oct 29 2003 (IPS)

Graciela Hilario, 53, knows that her 20 years of sewing experience are powerless against economic globalisation.

Speaking in Spanish from a telephone at the Levi Strauss sewing plant in San Antonio in the state of Texas she says, “es muy lamentable”, or, ”it is so sad”. Hilario says she likes her working conditions and her benefits, including three weeks of vacation and health care.

But soon her job will be gone, as negotiators from Levi and the Union of Needletrades, Industrial and Textile Employees (UNITE) begin to hammer out severance packages for workers in San Antonio.

The consequences of free trade hit the American apparel industry hard last month when Levi announced it plans to close its remaining North American facilities, laying off 800 employees in San Antonio and 1,180 in Canada.

The company is moving its operations to free trade zones in Haiti, among other places.

One of the major contrasts between this migration of apparel manufacturing to foreign countries and the shift that occurred within the United States from the north to the south around 1950 is that companies can no longer invest in capital and technological improvements to compete with markets where wages are lower.

The American industry is, in a sense, technologically saturated.

The plant closing comes 130 years after a man named Levi Strauss and his business partner, Jacob Davis, received a patent for a tiny metal grommet that secured the future of America’s quintessential jean company.

Katie Otto, a Levi representative, said shuttering the company’s remaining North American manufacturing facilities was “critical to the company’s long-term competitiveness,” and said there was no “apple-to-apple comparison” between savings in production costs in the United States and abroad.

Jean Hervey, the regional director for UNITE in San Antonio, said details about the severance plan would be determined at meetings expected to end in early November.

Hervey said the union was seeking one to three weeks of severance pay for every year of employment, at least six months of paid medical benefits and additional funds for new job training and education.

Levi has said it will contribute 700,000 U.S. dollars to help workers prepare for new jobs or start businesses of their own. The company has also contracted a firm to provide English classes and a variety of 12- to 18-month job-training courses.

Despite these potential benefits, many Levi sewers, whose average age is 45 and who have worked for the company for over 10 years, worry they will not qualify for new jobs in the car and aerospace industries that are replacing San Antonio’s apparel industry.

Vulema Duran, a member of UNITE and a 15-year veteran at Levi, said she appreciated the anticipated severance package but that it is incomplete and she would rather just keep her job.

Speaking in Spanish, Duran told IPS she hopes part of the severance package will guarantee jobs for Levi workers at a new Toyota plant in San Antonio. Toyota broke ground for the facility Oct. 17.

The plant will add more than 2,000 jobs in San Antonio, said Ramiro Cavazos of San Antonio’s Economic Development Department, adding it was “a given” that aerospace and automotive industry jobs would pay wages comparative to those at Levi.

The average wage at the jeans-maker is 14 dollars an hour, while starting wages at Toyota are 16 dollars.

But in an interview, Cavazos added that 25 percent of new Toyota employees have college degrees. “It’s going to take a lot of effort and desire on (the Levi workers’) part,” he said, to qualify for the positions.

Duran, who as a girl assembled car radios in Mexico before immigrating to the United States, said she hopes to find work on Toyota’s assembly lines. Yet she is still “enojada” – angry.

She said that when Levi representatives announced the plants’ closing in September, workers were told they would not receive their share of annual profits, which traditionally have come in the form of December bonuses.

Duran stressed that Levi’s CEO Phil Marineau’s 2002 compensation includes 22.5 million dollars in incentive pay and a 1.3-million-dollar bonus, in addition to his 1.2-million-dollar salary. On the other hand, workers who have literally been sewing the company together all year, will receive pink slips for Christmas.

David Ranney, associate fellow at the Institute for Policy Studies in Washington, D.C., says Levi could not compete with such rivals as the Gap and Tommy Hillfiger if it continued manufacturing in the United States because cheaper foreign labour has lowered its competitors’ production costs.

“Workers in apparel have been badly served by NAFTA’s undermining regulation and failure to include adequate labour and human rights standards,” Ranney said, referring to the North American Free Trade Agreement between the United States, Mexico and Canada..

Levi’s move to Haiti comes at a time when worker’s rights violations in third-world manufacturing facilities are being reported.

A Haitian advocacy group, Groupe d’Appui aux Rapatries et Refugies, reported earlier this year that 300 workers have been prevented from unionising in the country by Grupo M, a Dominican apparel company that hired them to assemble Levi products in a new Haitian free-trade zone near Maribahoux, Ouanaminthe.

On Oct. 9 the World Bank approved a 20-million-dollar loan to Grupo M to continue building manufacturing facilities in the Ouanamithe zone contingent on a finding that the allegations are proven to be unfounded.

The loss of manufacturing jobs in the United States and allegations of unfair labour practices occur against the backdrop of the final phase of negotiations for the Free Trade Agreement of the Americas (FTAA), set for November in Miami.

The FTAA would expand NAFTA to every country in Central America, South America and the Caribbean, except Cuba. Negotiations began when NAFTA was launched in 1994 and are expected to be completed in 2005.

The FTAA has come under strong fire from a cross-section of America. In September, a caravan called the “March to Miami” departed from Seattle for the Florida state city. Aboard were clergy, farmers, workers, environmentalists, union leaders and human rights activists. The march had a single message: “Stop the FTAA”.

John Campbell, an executive board member of United Steel Workers of America, Local 310, has worked 15 years at the Firestone plant in Des Moines. “The spirit of democracy is alive and well,” he says, “and that spirit is not consistent with these trade agreements.”

On the other hand, Jorge Pinto of Pace University’s Lubin School of Business, said in an interview, “Free trade has enormous consequences, but it is the best option for the United States and Latin America to compete with economies in Asia and Europe.”

Until the debate or agreement is settled, Graciela Hilario, the experienced and talented Levi seamstress in San Antonio, says she will focus on her work and try to pretend that nothing has happened. But deep down she knows that America’s apparel industry is nearly extinct.

Excerpt:

By IPS Correspondents
SAN JOSE, Oct 24 2003 (IPS)

Opening Central America’s borders to a flood of products “Made in the U.S.A.” will hurt farming and other areas of the region’s economy, warned groups opposed to the free trade treaty currently in the works, as negotiators wrapped up another phase of the talks Friday without producing any important results.

In the eighth round of talks involving five Central American governments and Washington begun Monday in the southern U.S. city of Houston, Texas, the negotiators reached an agreement on investment rules, but put off decisions on more sensitive areas – like farm and textile trade – until December.

Trade experts are saying that Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua, which are aiming for a Central American Free Trade Agreement (CAFTA) with the United States, are not prepared for the increase in consumption and the invasion of U.S. products that the treaty would entail.

“We oppose the way the treaty has been negotiated, in that there has been great exclusion of social and productive sectors, and it will ultimately break down the social model that for more than 50 years has sustained the Costa Rican people,” says Alvino Vargas, secretary-general of the National Association of Public Employees.

Faced with the liberalisation of the telecommunications sector to the detriment of Costa Rica and the “psychological war” against the population, the only viable recourse for putting a stop to the free trade agreement is for the people to take to the streets in protest, Vargas said in an IPS interview.

He explained that what he refers to as the psychological war is the Costa Rican right-wing’s efforts to make it look like the only ones who oppose the treaty are the labour unions.

When in reality, he said, what has emerged is “a broad social movement that includes peasant farmers, indigenous people, women’s groups and small and medium entrepreneurs.”

“The United States has threatened to exclude Costa Rica if it refuses to negotiate telecommunications. But in fact 60 percent of the leading companies that export to this country are based on U.S. capital, so I don’t think such a drastic measure will be taken,” said Vargas.

But a “pitched ideological battle” is drawing near, says the public employees union leader, adding that Central American society will defend with all its strength the right to include production in the trade negotiations underway with the United States.

“In the case of Costa Rica it is not possible that Mr. Robert Zoellick (U..S. trade representative) could come and pound on President Abel Pacheco’s desk and make him yield on the telecoms issue and demand an opening in that area,” he said.

Vargas criticised the attitude of Zoellick, who told Pacheco on Sep. 30 during a visit to Costa Rica that this country could be excluded from the trade agreement between the so-called Group of Five and the United States if it does not agree to liberalisation of its telecommunications market.

The union leader said that the fight to defend the Costa Rican Institute of Electricity (ICE) in 1999 unleashed a massive social movement that forced then-president Miguel Angel Rodríguez to withdraw his telecoms-liberalising bill from Congress.

“We will prove to the government and the right-wing businessmen that we are not just a few, but rather we are the vast majority of Costa Ricans who are against a treaty under the terms they are negotiating now,” Vargas said.

The opposition Citizen Action Party sent a letter to Pacheco demanding that he ensure there is transparency in the negotiations, stressing that very few Costa Ricans are aware of the contents of the treaty that is to be signed on their behalf.

Among the voices criticising the process is former Costa Rican president Rodrigo Carazo (1978-1982), who believes it is a mistake “to make the people believe that the free trade agreement will only bring benefits.”

Carazo noted that Roman Catholic bishops “of Canada, United States and Mexico counsel our politicians, before getting caught in a tangle like their countries are in the North American Free Trade Agreement (NAFTA), to meet in order to hear about all of the bad things that have occurred, so that they don’t make the same mistakes.”

More than 50 percent of the region’s trade is with the United States and millions of Central Americans reside within the borders of the North American giant, whether legally or illegally.

For Central America, where half of the 38 million habitants live in poverty, the treaty with the United States could represent a great opportunity, admit CAFTA critics, but only if negotiated under different conditions than are being discussed now, they say.

Edgar Brenes, of the Salvadoran non-governmental National Foundation for Development (FUNDE), said in comments to IPS that there is a conviction among negotiators to reach an agreement, even at the expense of the most vulnerable sectors, such as small farmers and entrepreneurs.

“We have made written observations and we have participated, in adjacent rooms, in the various rounds of the talks, but our contributions are never taken into consideration. The governments only discuss what is of interest to specific economic sectors,” he said.

Brenes added that the Mesoamerican Initiative on Trade, Integration and Development (CID), an umbrella group for numerous Central American non-governmental organisations, including FUNDE, has been closely following the talks and has found a “marked exclusion” of civil society in general.

In this context, and with the governments aiming to sign the treaty in December, the NGOs are planning to step up protests and to increase pressure on the legislatures in the five Central American countries that are to ratify the treaty once it is signed.

The first anti-CAFTA demonstrations took place Oct. 20 in El Salvador and Costa Rica, and organisers in the latter are planning another for Nov. 20.

El Salvador’s economy minister, Miguel Lacayo, has met the criticisms head on, stating that the government has been open to input from the population in regards to the treaty, proved by the “more than 200 meetings that the Office of Productive Sector Support has held with various producers.”

The Salvadoran people have been duly informed of what they can expect from the regional accord with the United States, said Lacayo.

According to Nicaraguan economist and sociologist Cirilo Otero, there are at least five basic premises for understanding CAFTA:

“The political demands made by the United States, the reliance of our economies on that country, the impossibility of avoiding the treaty given the conditions of the global market, the dependence of the region’s governments on institutions like the World Bank and the International Monetary Fund, and their divisiveness when the time comes to negotiate.”

Otero says the Central American countries should form a solid negotiating bloc so that they can protect themselves in the economic areas where they are most vulnerable.

“In Costa Rica, it’s the telecommunications sector, in Nicaragua and Honduras it’s agriculture and textiles, and in El Salvador and Guatemala, services and trade,” he said.

The fact is that the region is not prepared for an increase in consumption, and the flood of U.S. products could only be assimilated if citizens turn to sources of cash as diverse as “remittances (from relatives living in the United States), money laundering or drug trafficking,” commented the expert.

Several of the region’s countries already have free trade agreements in force with Mexico and Canada, and have yet to see the “great benefits” they were promised, Otero added.

Excerpt:

By Paul Weinberg
TORONTO, Oct 17 2003 (IPS)

So far it is unclear if incoming prime minister Paul Martin will follow the advice of some of his business backers to integrate the country’s economy and governance more deeply with the neighbouring United States.

But a group of progressives is not waiting to find out.

About 100 left-leaning union economists, activists and university academics met here this week to counter the message being delivered by the advocates of ”deep integration” in the business community and its supporting think tanks.

It is believed that many of those advocates are rubbing their hands in anticipation of Martin’s ascension to the top of the Liberal Party and into the position of prime minister, to replace retiring Prime Minister Jean Chretien next February.

Martin, a former finance minister and millionaire businessman, is widely considered to be more business-friendly than Chretien and more disposed to cementing the current wobbly relationship between Ottawa and Washington..

”First, our bilateral relations must be conducted on a far more sophisticated basis than it has been to date,” said Martin in a speech in April.

“We must engage the Americans face-to-face at important levels of our respective political systems – prime minister and president; premiers and governors; members of parliament and members of congress; mayors, business and uunion leaders, and civil society.”

As defined by one of its chief advocates, the Canadian Council of Chief Executives (CCCE), deep integration is essentially a North American common market or customs union that would include continental approaches in a host of areas like natural resources, business and trade regulations, defence, immigration and refugees.

The proposal appears to exclude Mexico, the third partner of the current North American Free Trade Agreement (NAFTA).

Martin has not commented on the deep integration proposal, a topic that is below the political radar here.

Free trade with the United States has led business to pressure Ottawa to follow more regressive U.S.-style tax and social policies so that Canada remains economically competitive, says Bruce Campbell of the labour-backed, Ottawa-based Canadian Centre for Policy Alternatives (CCPA).

One much cited example is unemployment insurance, which, since the first free trade treaty was signed 15 years ago, has had its eligibility requirements toughened and benefits lowered in line with the less generous U.S. model.

How far Canada with its population of 30 million (1/10 of the U.S. number) will accommodate itself as the ”junior partner” attached to the larger U.S. economy was the subject of this week’s public teach-in and academic conference organised by the CCPA.

This is ”the first time”, said Campbell, that representatives of various organisations, including unions and social justice groups, have met to share research and strategies regarding Martin’s ascent and the ramifications of deep integration.

”The business community has long given up on Canada as an independent and sovereign entity,” he added in an interview.

Conference participants struck a different note from earlier, and unsuccessful, battles in the late 1980s and early ’90s to stop the initial Free Trade Agreement (FTA) with the United States and the subsequent NAFTA.

For instance, no one argued with the thesis of panel speaker Maria Banda that Canada’s economic integration with the U.S. ”is irreversible”.

But others, including Canadian Labour Congress economist Andrew Jackson, discussed creative ways to maintain distinctive Canadian policies in culture, industrial policy and the environment, even under restrictive NAFTA rules. He cited, for example, a strategy that favoured environmentally friendly products.

”The way forward for Canada is to retain as much room for manoeuvre as we can vis-à-vis the U.S., while advancing a progressive agenda at the national and international level,” Jackson argued.

”There can realistically be no return to the somewhat more insulated economic space of the late 1980s, given the realities of globalised capitalism and close continental integration in terms of trade in goods and, to a much lesser but growing extent, services.”

Representing Canada’s major companies – most of which are subsidiaries of U.S. enterprises – the CCCE began pushing deep integration two years ago because of its concern that Canadian business might be locked out of its most important market, the United States, where Canada sends more than 85 percent of its exports.

After the terrorist attacks of Sep. 11, 2001, some local U.S. politicians called Canada ”a haven for terrorists” because of its more liberal immigration and refugee policies, although all of the terrorist attackers had been resident in the United States..

Those reactions raised fears that Washington would strengthen its borders and turn ever more inward, making it harder to do business with the giant.

Today, there is little appetite among Canadian and American politicians alike for another big trade deal. More likely, says Campbell, is that Ottawa will make incremental moves towards deep integration if no opposition is mounted.

What complicates that process is that as the countries’ economies converge under the FTA and NAFTA, their social and political policies and attitudes are diverging.

At the conference, University of Toronto professor of political economy, Stephen Clarkson, author of ‘Uncle Sam and Us: Globalisation, Neoconservatism and the Canadian State’, pointed to recent actions by Chretien to reinforce that trend.

The prime minister pushed ahead with his domestic programme, which included one item to which the Bush administration openly objected – the decriminalisation of possessing small amounts of marijuana.

He added insult to injury by signalling the federal government would legislate a Canada-wide norm backing an Ontario court ruling that sanctioned the marriage of same sex partners, a prospect deeply offensive to social conservatives in Washington, says Clarkson.

Because deep integration is too abstract a concept, says Campbell, its opponents will have to target specific issues, like the much-discussed common North American defence policy that arbitrarily accepts the U.S. approach to missile defence and nuclear proliferation.

”There is a whole array of concrete areas where those flashpoints will be focused on. And that is probably how the battles are going to be fought,” he added.

Excerpt:

By Marty Logan
MONTREAL, Oct 14 2003 (IPS)

A review of the ‘green guardian’ of the North American Free Trade Agreement announced Tuesday will undoubtedly reveal flaws, but the decade-old system will likely be superior to the environmental protections included in the proposed Free Trade Area of the Americas (FTAA) and other future pacts, say experts.

A six-member review and assessment committee will probe the effectiveness of the North American Agreement on Environmental Cooperation (NAAEC), the environmental side accord to the North American Free Trade Agreement (NAFTA) signed by Canada, Mexico and the United States in 1993.

The six independent committee members will also consider the work of the Commission for Environmental Cooperation (CEC), which was set up to implement the NAAEC, said a media release from the organisation.

“What makes the CEC different from what’s under discussion now in the CAFTA (Central American Free Trade Agreement) and the FTAA is that at least there is a commitment for a budget every year so you know what you are working with,” said Scott Vaughan, visiting scholar at the Carnegie Endowment for International Peace, in Washington.

“The irony is that when they were negotiating NAFTA 10 years ago and the side agreement, it looked like (those) were going to be the point of departure and everything was going to get stronger from there. Now they look like they’re the high point and everything from there has gone downwards in terms of actually coordinating environmental policy and trade,” he added in an interview.

Negotiations towards the FTAA, a deal that would include 34 nations in the western hemisphere, are scheduled to continue in Miami in November, while Washington wants to sign the CAFTA with its five Central American partners in December.

“We will see, I think, attempts to use the (NAFTA) side agreement and the CEC as a sort of example of what ought to be embedded in the FTAA,” says David Runnalls, president of the International Institute for Sustainable Development, based in Winnipeg, Canada.

“I think it’s a second-best solution because what it essentially allows governments to do is to sort of ‘ghetto-ise’ the environment and say ‘oh yeah, we’ve got a commission to deal with that’.”

He believes the NAAEC review should “come to the conclusion very rapidly that the CEC needs some more muscle and some more teeth. How it gets there, I don’t know, but that does mean much more input on the trade policy of the three countries.”

The review team is scheduled to produce a draft report for public comment before submitting its findings to the environment ministers of the three NAFTA countries in spring 2004.

Runnalls and Vaughan agree that the NAAEC has had successes, including pushing Mexico to improve its environmental protection practices.

“Is progress as rapid as one would like to see?” asked Runnalls. “No. Has Mexico become a haven for good environmental policy? No. Is it better than it was? Probably.”

“The mechanisms are there and the mechanisms are quite unique… I can’t think of another international agreement in which a citizen can go in and complain in front of his or her minister to two other ministers that this first minister isn’t doing his or her job properly,” he added.

Last December the CEC concluded that free trade had, on the whole, been good for the North American environment.

While its report found that NAFTA has had negative consequences, such as allowing companies to move polluting factories and ship industrial waste to jurisdictions with less stringent laws, it also said many new factories built in Mexico have better pollution abatement systems, and that NAFTA regulations forced the Mexican government to impose more stringent rules on pesticide use.

“While there is much more to know, it is clear that trade liberalisation accompanied by robust environmental policies can help achieve sustainable development – just as freer trade without adequate environmental safeguards can trigger degradation,” said Victor Shantora, acting executive director of the CEC.

“The key lesson is that policy matters,” he told IPS.

Vaughan called the CEC claim submissions process “probably the strongest legal and institutional model for public participation and transparency and governance from the bottom up”, but pointed out other shortcomings in the body’s operations.

“NGOs (non-governmental organisations) have been really concerned about NAFTA Chapter 11 issues involving the environment, and they repeatedly wrote to the CEC to ask for it to become involved in the environment-related expropriation cases under Chapter 11, but the CEC has no more access to the free trade commission than anybody off of the street.”

“As it’s supposed to be a side agreement to NAFTA, it doesn’t speak very well of its powers,” he added.

According to Runnalls, “the real problem for the CEC from the beginning is that none of the three countries has invested enough in it politically to make it work, even at the level of the environment ministers… This is an orphan. It’s got no political parents any more, and that has been its fundamental problem.”

Excerpt:

By Emad Mekay
WASHINGTON, Oct 1 2003 (IPS)

The U.S. administration’s newly-minted post-Cancun doctrine favouring bilateral and regional trade deals rather than multilateral pacts is already banging into opposition both at home and abroad.

Two weeks after the collapse of global trade talks in Cancun, Mexico and six weeks before western hemisphere countries are due to start talks in Miami on the Free Trade Area of the Americas (FTAA), U.S. Trade Representative Robert Zoellick was en route Tuesday to Central America to help conclude a regional ”free trade” deal with five nations.

And in another sign the United States is forging ahead on its bilateral path, Chilean officials said Monday their Congress is likely to approve a free trade deal with Washington as early as next month.

The administration already has a packed free trade agenda until 2005, including deals with Singapore, Chile, the Southern Africa Customs Union, Australia, and Morocco, as well as renewal of the African Growth and Opportunity Act, the Enterprise for ASEAN Initiative and conclusion of the FTAA.

Washington’s existing free trade partners are Canada and Mexico (within the North America Free Trade Agreement, NAFTA); Israel and Jordan.

The renewed U.S. effort comes after the trade agenda of the administration of President George W. Bush suffered a major setback during the World Trade Organisation (WTO) negotiations in Cancun.

That is where developing countries banded together to oppose current trade rules they said harm poor nations, especially rich countries’ agricultural subsides for their farmers.

They also opposed extending WTO rules to new issues, such as investment and procurement, when Washington in particular refused to discard its unilateral approach and agree to make world trade a more fair process. The talks collapsed Sep. 14.

Despite the setback for its trade agenda, the administration quickly vowed that it would pursue its policy through a series of ambitious regional and bilateral agreements, with Zoellick boasting that individual countries were lining up to deal with Washington.

In an op-ed article in London’s ‘Financial Times’ last week, the trade representative said the United States will not wait for ”the won’t-do countries” and charged that the Cancun meetings were derailed because of ”increasingly radical rhetoric”.

”As WTO members ponder the future, the U.S. will not wait: we will move towards free trade with can-do countries,” he wrote.

But that approach has so far failed to win public support. On the contrary, it has drawn criticism from politicians, economists, protest groups, labour unions and even business organisations.

Clyde Prestowitz, president of the Economic Strategy Institute, a Washington-based economic think tank, wrote in ‘The Washington Post’ on Monday that the administration’s new tactic was ”ironic” because it was the United States that devoted significant effort and time after the Second World War to promote multilateral free trade.

Prestowitz, who was a trade negotiator in the Reagan administration during the 1980s, said that the Bush team would be better advised to use its unilateral approach to eliminate developing countries’ concerns rather than to strike more trade deals.

The United States, he said, ”should forget about being a shrewd Yankee trader and just cut the (agricultural) subsidies unilaterally”.

”Doing so would not only help U.S. consumers à it would help preserve the principles and framework of non-discriminatory global trade, to which this country has long been committed,” he said.

Under the new approach, Zoellick’s trip to sign the Central American Free Trade Agreement (CAFTA) takes on a new significance. The pact with the five countries of the region would be the U.S.’ first regional free-trade deal since the North American Free Trade Agreement (NAFTA) a decade ago.

But it also comes amid unprecedented criticism of Washington’s trade plans.

The CAFTA deal, which the administration wants done by Dec. 21, could face challenges from the U.S. Congress over concerns about labour and environmental standards in the Central American nations.

At home, there are worries that free trade in general is taking away jobs from Americans.

The loss of U.S. manufacturing jobs has intensified criticism of trade agreements among many of the 10 Democrats competing to win their party’s nomination in next year’s presidential election against Bush.

Many of the hopefuls accuse the administration of putting American families out of business, and say they would want tougher protections for U.S. workers as part of current and future trade agreements.

Perhaps more telling is that the U.S. public has turned against free trade.

An NBC News-‘Wall Street Journal’ poll on the economy and presidential race found the public holding a negative view of free trade.

A majority of those polled (54 percent) said free trade was ”not worth it”, while 35 were in favour.

The poll vindicates another survey in March 2003 by the research firm EPIC/MRA, which showed a majority expressing dissatisfaction with NAFTA.

When given three options for the future of NAFTA, hailed by Washington as a model for other free trade deals, only 21 percent of respondents said the agreement should continue as is.

Nearly 57 percent said NAFTA should continue with changes, while 12 percent wanted it ended entirely.

Free trade plans have also refuelled anger among interest groups and civil society organisations.

Thousands of protesters, from labour unionists to environmentalists to churchgoers, said they plan to travel to South Florida Nov. 16-21 to protest the FTAA meetings.

To compound Zoellick’s concerns, the new approach of unilateral deals has also been criticised by business, which, ironically, is supposed to be one of the deals’ main beneficiaries.

In a Sep. 23 letter to Zoellick, a coalition of business groups urged the administration to “stay the course” and demand a “comprehensive and commercially meaningful” FTAA rather than a watered-down version or small deals.

Internationally, Brazil, one of the developing nations that led the Cancun meeting to a grinding halt – and the co-chair of the FTAA talks – threatened last week that the hemispheric plan must be simplified, and Washington must cut its farm subsides, if the project is not to meet the same fate as the talks in Cancun.

Excerpt:

By IPS Correspondents
MEXICO CITY, Sep 26 2003 (IPS)

Conservative Mexican President Vicente Fox met with his leftist counterpart from Brazil, Luiz Inácio Lula da Silva, to once again repeat pledges of friendship and cooperation, but with an underlying current of rivalry.

In the meeting, which took place during a 24-hour visit by Lula to the Mexican capital that ended Friday, the Brazilian president admitted that the two countries defend their own interests, but said ”we are seeking a common meeting-ground that will benefit everyone.”

The two countries, which together represent 61 percent of Latin America’s combined gross domestic product, have different views on the future Free Trade Area of the Americas (FTAA), of which Mexico is a staunch supporter, while Brazil has put up some resistance to the continent-wide free trade project.

The two countries also have different interests with respect to trade relations with the United States, which absorbs almost 90 percent of Mexico’s exports and is a partner with Mexico and Canada in the North American Free Trade Agreement (NAFTA).

Observers say that between Lula and Fox, who have known each other since 1996, there is also a silent dispute for leadership in Latin America and the Caribbean, and to see who will become the foremost spokesman for the region vis-a-vis the industrialised world.

Both leaders have made it clear that they would like a permanent seat on the United Nations Security Council for their countries, Latin America’s giants.

But both see eye to eye on the need for reforms of the Security Council, which currently has just five permanent members: China, the United States, Britain, France and Russia.

However, if that reform occurs, only one Latin American nation would be admitted as a permanent member of the Council.

”The differences between Mexico and Brazil in terms of geographic location, production systems and economic interests are obvious, but it is true that they share common values with respect to democracy and justice – although these are no longer novelties,” Héctor Lozano, an expert on international affairs at the National University of Mexico, told IPS.

In response to a question by journalists on the differences between the two countries, Lula said ”Brazil obviously has its interests, and without a doubt Mexico, as the important country that it is, has its own, but then again, we all have our own interests.”

In Thursday’s meeting, Lula and Fox signed an agreement on tax policy, and to crack down on fiscal evasion.

They also promised, as they have before, that at some point a free trade treaty will be negotiated between Mexico and South America’s Mercosur trade bloc, made up of Brazil, Argentina, Paraguay and Uruguay.

”I’m convinced that the audacity of our relations is what will press the developed world to be more flexible in trade negotiations, especially regarding farm products,” said Lula.

Brazil and Mexico both form part of the so-called Group of 22 (G22) developing nations, which played a key role in the fifth World Trade Organisation (WTO) ministerial conference held Sep. 10-14 in the Mexican resort of Cancun.

In the gathering, the G22 demanded that the industrialised countries begin to make real progress towards phasing out the enormous subsidies they provide their farmers. Due to the predominantly North-South deadlock on that issue and others, the meeting came to an abrupt end without any agreement.

While non-governmental organisations and World Bank officials have described the G22 as a powerful new actor on the global stage, official spokespersons in Latin American countries like Mexico and Colombia have stated that their nations are in the new alliance solely due to pragmatic reasons, and that they could withdraw at any time.

Observers say that due to pressure from the United States and their eagerness to sign bilateral trade deals with Washington, several Latin American countries may pull out of the new grouping.

One of the G22’s leaders is Brazil, among other reasons because it is a major agricultural producer at the vanguard of the fight for greater access to the U.S. and EU markets, which shell out more than one billion dollars a day in farm subsidies.

Mexico is also opposed to the subsidies, but unlike Brazil, it is not a major player in the arena of agricultural exports. Moreover, it has already signed free trade agreements with the United States and the EU, which allow it to export fresh produce and other farm products to those markets with greater ease.

According to official figures, between 1994, when NAFTA went into effect, and 2002, trade in agricultural products between the United States and Mexico rose over 100 percent, to 12.8 billion dollars a year.

But agriculture accounts for just six percent of trade between the two countries, which totals 200 billion dollars a year, twice the size of the bilateral trade flow seen a decade ago.

Meanwhile, Brazil, a country of 174 million, is involved in trade disputes with the United States on several fronts.

For example, orange juice exports from Brazil, the world’s biggest producer, pay a 56 percent tariff to enter the U.S. market.

And Brazil’s steel exports to the United States between January and April 2003 were 51.6 percent down from the same period in 2002, due to a number of trade barriers.

”At the level of governments and presidents, Brazil and Mexico can swear eternal love, but in reality there are interests that separate them,” said Lozano.

”There will be moments when we will see them on different sides,” he predicted.

But Brazil’s ambassador to Mexico, Luiz Augusto de Araujo, said that ”between Brazil and Mexico, there are more agreements than differences, which always exist.”

He mentioned, for instance, the two countries’ common positions on nuclear disarmament and the need to reform the U.N. Security Council.

In their meeting in Mexico, Lula and Fox pledged to work together to strengthen democracy and justice in Latin America, and to boost trade flows between their two countries, which amounted to just three billion dollars in 2002 – a small figure given that Mexico, population 100 million, and Brazil are the region’s two largest economies.

This week’s meeting between the two leaders was the third since Lula took office on Jan. 1.

The first took place in May, at a gathering of the Rio Group – the highest Latin American forum for political consultation and coordination – in Peru. The second occurred in Evian, France, where the two leaders were attending the summit of the Group of Eight (G8) most powerful countries.

Excerpt:

By IPS Correspondents
MEXICO CITY, Sep 22 2003 (IPS)

The group of developing countries that emerged as the G22 or G20+ to defend their interests in the face of the world’s rich nations at this month’s WTO ministerial meeting may have a short life expectancy, say experts in Latin America.

The tension that marked the four-day conference in the Mexican resort of Cancun, which ended on Sep. 14 with no agreement between the 146 World Trade Organisation (WTO) member nations, left rifts within the new grouping, 13 of whose member countries are Latin American.

Government officials and observers consulted by IPS in several countries of Latin America – Colombia, Costa Rica, Chile, Guatemala, Mexico and Peru – said their nations might decide to pull out of the informal grouping and seek bilateral trade deals with the United States.

El Salvador has already done so, withdrawing from the G22 just before the WTO meeting came to an end.

Representatives of that nation in Central America – a region that is currently negotiating a free trade agreement with the United States – said the G22, one of whose leaders is Brazil, did not represent its interests.

”The G22 – or G21 without El Salvador – is barely hanging together, and the most likely scenario is that it will soon start breaking up,” predicted Germán de la Reza, a professor of integration issues in several Mexican universities.

The only members that would stick together, at least in negotiations of a regional nature, would be Argentina, Brazil, Cuba and Venezuela, which see eye to eye on a number of political issues and share similar commercial interests, he said.

Bolivia, Ecuador and Paraguay have expressed doubts as to whether to remain in the G22, as well as interest in signing trade agreements with the United States. Washington has implied that those who form part of the bloc will not be considered for future bilateral trade negotiations.

Republican Senator Charles Grassley said ”I will use my position as chairman of the Senate Finance Committee, which has jurisdiction over international trade policy in the U.S. Senate, to carefully scrutinise the positions taken by many WTO members during this ministerial.

”I will take note of those nations that played a constructive role in Cancun, and those nations that did not.”

Based on that analysis, Washington will decide which countries it continues to see as potential partners for trade agreements, he added.

In Cancun, the G22 demanded in bloc that the industrialised countries begin to phase out protectionist measures in agriculture, while setting forth other demands that also ran into resistance by the rich nations. The meeting was unable to overcome the largely North-South deadlock, and failed to reach an agreement.

The end of 2004 is the deadline for the 146 WTO member countries to begin to implement a series of pending accords that would benefit developing nations.

The agreements include slashing the more than 300 billion dollars a year in farm subsidies shelled out by the governments of industrialised countries, which the WTO admits have a negative impact on poor countries.

Observers say the failure in Cancun has also cast doubt on the possibility of meeting WTO timetables and targets, and that many countries in Latin America will put new – or renewed – efforts into seeking regional and bilateral trade agreements, especially with the United States, the region’s biggest importer.

Another consequence of the fiasco is the possible delay of the Free Trade Area of the Americas (FTAA), which is to be created by January 2005.

”The outcome of the meeting will have an impact on all regional negotiations, including the FTAA talks and timetable,” said Venezuelan Minister of Production and Trade Ramón Rosales. ”One of the predictions, which has also been referred to by the United States, is that countries will turn more and more to a search for bilateral accords.”

In the negotiations for the creation of the FTAA, which will create a free trade zone stretching from Alaska in the north to Tierra del Fuego in the south, encompassing all countries in the hemisphere except Cuba, conflicts over farm subsidies and the dismantling of anti-dumping (the export of products at prices deemed artificially low) measures were transferred to the WTO, where no progress has been made.

Venezuela’s populist left-leaning President Hugo Chávez said ”the FTAA has been dealt a harsh blow by what occurred in Cancun, and for that reason we are going to push even harder for the creation of ALBA” – the acronym that stands for Bolivarian (for South American independence hero Simon Bolivar) Alternative for the Americas.

ALBA is an expression of somewhat hazy ideas that Chávez has proposed as an alternative to the FTAA, to which he is opposed.

World Bank President James Wolfensohn said the emergence of the G22, led by big agricultural exporters like Brazil, India and China, has given rise to a new paradigm of global financial relations for the 21st century, and has demonstrated that poor countries can act as an effective counterweight to the rich.

Antonio Romero at the Latin American Economic System (SELA), which links 28 countries in the region, told IPS that ”this is the first time in many years that the countries of the South have shown such capacity for working together and forging alliances.”

The failure to reach an agreement in Cancun, where the WTO hoped to move forward on the Doha Development Agenda, which arose from the last ministerial meeting, was wildly celebrated by the activists who had flocked to Mexico from all over the world.

The activists gave the G22 the credit for standing up, with determination and unity, to the might of the industrialised nations and transnational corporations, and foresaw a promising future for the new grouping.

But that unity, and the new paradigm of which Wolfensohn spoke, may not last, according to observers in Latin America.

Chávez said the G22 ”is merely a possibility that is emerging, that is just now being born, and one that is not free of contradictions. It would be desirable to work towards its consolidation, to take it beyond the question of agriculture, and into other issues like that of intellectual property, for example.”

Colombian Trade Minister Jorge Botero said his country would remain in the G22 ”only as long as the group does not become a factor of political confrontation with the United States.”

Researcher Héctor Moncayo at the Latin American Institute of Alternative Legal Services in Bogota told IPS that Colombia’s participation in the G22 ”is very strange, and contradictory.

”If you think about it in a cynical manner, you might say Colombia entered the G22 because it was interested in hurting the (WTO) meeting, because by harming the conference, and the FTAA project along with it, the possibility of achieving the bilateral trade agreement it is seeking with the United States would be strengthened. But that would be too machiavellian,” he said.

Chilean Foreign Minister Soledad Alvear, whose country has already signed a free trade deal with the United States, said that in Cancun ”some poor countries failed to understand that flexibility is essential in trade negotiations in order to achieve accords.”

Mexico, which along with Canada and the United States is a member of the North American Free Trade Agreement (NAFTA), joined the G22 for merely pragmatic purposes, and trade negotiator Eduardo Pérez insinuated that his country could pull out at any time.

IPS heard similar views in other countries as well.

”We are allied with the G22 only with respect to the liberalisation of trade in farm products with the developed countries,” said the director of the Paraguayan Foreign Ministry’s office on Multilateral Economic Bodies, Igor Pangrazio.

What virtually all of the governments of Latin America do agree on is that the multilateral negotiations must now be shored up to prevent the collapse of the Doha Round of talks. However, each country has a different take on the consequences of what occurred in Cancun.

Chilean Agriculture Minister Jaime Campos agreed with the National Agriculture Association that the failure to reach an agreement in Cancun was unfortunate, but irrelevant to Chile.

”Chile has already resolved the questions of market access and farm export subsidies, due to the free trade treaties we recently signed with the European Union, the United States, the European Free Trade Association and South Korea,” said Campos.

Argentine Deputy Foreign Minister Martín Redrado said that in the end, something positive emerged from Cancun, where his country found ”a coalition of interests which in the future will give greater political strength” to the common demands set forth by developing countries.

(*) Humberto Márquez in Venezuela, María Isabel García in Colombia, Gustavo González in Chile, Marcela Valente in Argentina, Alberto Sciscioli in Paraguay and José Eduardo Mora in Costa Rica contributed to this report.

Excerpt:

By IPS Correspondents
SANTIAGO, May 28 2003 (IPS)

Many in Latin America argue that cultural products are not just another form of merchandise. But that premise is rarely applied when governments in the region negotiate free trade deals.

The issue has been avoided so far in the talks on the creation of the Free Trade Area of the Americas (FTAA), despite the fact that many Latin Americans fear that the Washington-promoted free trade agreement will lead to even greater U.S. cultural penetration in the region.

”The FTAA will essentially be focused on trade, and aspects that can generate disputes, such as the question of culture, will be negotiated in other forums, like the WTO (World Trade Organisation),” Germán de la Reza, an expert on integration issues at the National Autonomous University of Mexico, told IPS.

But strict compliance with WTO provisions is resisted by small countries in the hemisphere, which ”would not be able to compete on an equal footing if their markets were opened indiscriminately in vital areas, like the recording and film industries,” said Antonio Romero, coordinator of the Caracas-based Latin American Economic System (SELA).

Chilean filmmaker Miguel Littín pointed out to IPS that free trade accords threaten culture, because ”the small morsels of assistance” that states currently earmark for the development of the arts will run the risk of disappearing altogether, as they will be labelled ”forms of protectionism.”

The FTAA will create a vast free trade zone encompassing 34 nations in the hemisphere – every country except Cuba. The negotiations are scheduled to conclude in January 2005, and the agreement is to go into effect in late 2005 or early 2006, once it is ratified by the legislatures of each member nation.

The enormous assymetries involved in the process, which will associate small Caribbean island states and impoverished Latin American countries with the world’s leading economic and military power, make the negotiations on questions of culture even more complex.

Trade accords in the era of globalisation cover a broad range of cultural aspects, from the easing of tariffs on the inputs used by the recording and film industries to the coverage of artistic creations by intellectual property rules.

Concerns also arise regarding the preservation of the artistic and cultural heritage of nations, which is threatened by the growing concentration of the mass media in the hands of transnational news, show business and entertainment conglomerates.

”Culture, and film in particular, is not just another product,” Assunçao Hernández, president of the Brazilian Congress of Film and the Sao Paulo Film Industry Union, said in an interview. ”It is inextricably linked to the identity of a nation; it forms, and forms part of, the national imaginary.”

In the view of Chilean writer Pía Barros, ”the problem of globalisation is that rubbish is also globalised, and that means we have to ask ourselves what is culture. Free trade treaties talk about doing commerce with cultural products, and I don’t agree with that.

”We can have government policies aimed at a country’s cultural development, but culture is not a negotiable asset that can belong to a government. Culture must be given preferential treatment, but by all countries, in order to establish cultural interaction with the rest,” she commented to IPS.

On this front, as in all areas to be discussed as part of the FTAA process, Brazil wants Latin America to take a united stand, in order to strengthen the region’s bargaining position in negotiations with the United States.

Brazilian Culture Minister and world-famous musician Gilberto Gil waved the banner of cultural integration on a visit to Chile early this month. But little has been done as of yet.

For now, Brazil is not assuming any commitment on culture in the trade negotiations, a source at Brazil’s Foreign Ministry told IPS, adding that his country was ”not offering or asking for anything, and thus is not proposing any modifications of the current norms in the WTO.”

The Southern Common Market (Mercosur) trade bloc, created in 1991 by Argentina, Brazil, Paraguay and Uruguay, has generated more rhetoric than actual progress in terms of cultural integration, said Antonio Mercader, who served two stints as education minister of Uruguay in the past 12 years.

There are useful suggestions and interesting plans, but the four countries took their biggest step forward in that area when they chose the same TV broadcasting standard, decades before the bloc was created, he said.

The European Union, which signed a free trade and integration agreement with Chile and is negotiating a similar framework accord with the Mercosur, pledged to promote investment and technology transfer in the field of culture, while ensuring ”the adequate and effective protection of intellectual property rights.”

Chile adopted more or less similar criteria in its free trade treaty with the United States, which President George W. Bush is expected to send to Congress for approval within the next two months, according to Chilean Foreign Minister Soledad Alvear.

In agreement with the Chilean Coalition for Cultural Diversity, made up of filmmakers and others involved in the culture industry, Santiago proposed ”a broad reservation on culture, arguing that cultural products should not be treated as just another form of merchandise,” said Osvaldo Rosales, the head of the country’s negotiating team.

That reservation, which was inserted into the free trade accord’s chapters on services and investment, will allow Chile, for example, to reach cultural cooperation agreements in the future with whomsoever it pleases, he underlined.

The free trade treaty between Chile and the United States also foresees a gradual lifting of tariffs on inputs for cultural products, as well as copyright protection in the chapter on intellectual property, Rosales explained.

In addition, all agreements on culture within the scope of the free trade accord must be in line with WTO norms, he said.

By contrast, the North American Free Trade Agreement (NAFTA), which links Canada, Mexico and the United States, has no special chapter on culture, and merely stipulates that each member nation will apply its own copyright laws.

The mechanism of the ”reservation on culture” is also of interest to filmmakers in Brazil, who are pushing for greater diversity in the films that are imported, given that 90 percent of the movies shown in cinemas and on TV in Brazil currently come from the United States.

Littín is also in favour of exceptions for culture in free trade treaties, and advocates effective integration in Latin America.

”For over 30 years we have been fighting for what we call ‘the Common Market of Latin American Art’, especially with respect to the ‘industrial’ arts – film, TV and video,” he pointed out.

The idea is that ”every film made in one of the countries of Latin America would have the same ‘nationality’ and could move from country to country, from market to market, without paying duties or taxes,” said the filmmaker.

”That, in conjunction with a broader initiative which would include Latin countries in Europe, would be the only way to establish a more favourable balance in the face of the hegemony over the media that the Anglo-Saxon industry currently enjoys,” Littín argued.

* Diego Cevallos (Mexico), Humberto Márquez (Venezuela), Mario Osava (Brazil) and Marcelo Pereira (Uruguay) contributed to this report.

Excerpt:

By IPS Correspondents
MEXICO CITY, Apr 28 2003 (IPS)

The hype and glitz that surrounded the ceremony in which the Mexican government and farmers’ associations signed a new rural development agreement Monday stood in contrast to its content, which hardly resembled the far-reaching measures demanded by small farmers.

In the presence of more than 1,000 guests, including state governors and the heads of several of Mexico’s farmers’ movements, President Vicente Fox said the national farm accord marked the start of a ”new era” for rural Mexico, where 75 percent of the country’s poor are concentrated.

Interior Secretary Santiago Creel said the pact would fulfill a long-standing debt to Mexico’s small farmers, who contribute five percent of Gross Domestic Product (GDP), three times less than 30 years ago, according to official statistics.

But the National Union of Autonomous Regional Peasant Organisations (UNORCA) refused to sign the new accord, arguing – as did a number of analysts – that it was too ”superficial.”

Rafael Galindo, a representative of the Permanent Agrarian Congress, a group aligned with the Institutional Revolutionary Party (PRI), which did sign the document, said that ”the pact will not change the reality of the poverty” that plagues the country’s small farmers, and warned that ”this accord does not imply a halt to the struggle of peasant farmers.”

The new pact, signed after numerous nationwide protests by small farmers and nearly four months of negotiations, contains promises by the government. But it does not specify where the funds for the new measures are to come from, nor when they are to go into effect.

”Some of the points of the accord are sensible, but most of them simply reiterate good intentions and previously existing plans,” Sergio Maestre, a professor of agricultural law at the La Salle University in Mexico City, told IPS.

The heads of farmers’ associations with ties to the two main opposition parties, the PRI and the leftist Party of the Democratic Revolution (PRD), took part in signing the agreement at the ceremony in the National Palace, the seat of government. Fox described the event as ”historic.”

”The national farm accord is the fruit of a broad, all- inclusive, respectful and plural process, generated from the very entrails of rural society and supported by a presidency that has opened up to society, that listens to its demands, that accepts proposals, and that responds with commitments,” he added.

According to the new pact, the government will provide 1.8 billion dollars in additional aid to farmers in the medium-term, which will come on top of this year’s agriculture budget of 11.7 billion dollars.

Part of the 700 million dollars in windfall oil export revenues, the result of the rise in international petroleum prices, will also be earmarked for the country’s agriculture sector.

The agreement includes government commitments to support agricultural production and sales, and to provide solutions for some 30,000 disputes over land titles and property boundaries between states, local farm communities, and private owners.

In addition, the pact pledges support for improving rural health systems and education and building rural housing, as well as special assistance for women and the elderly.

But the revolutionary changes that the farmers’ groups said they would negotiate with the government are nowhere to be seen in the accord.

For example, agreements to lift tariffs on farm products in trade with the United States and Canada, Mexico’s partners in the North American Free Trade Agremeent (NAFTA), will not be suspended, as farmers had loudly demanded with roadblocks and demonstrations in which they even herded livestock into public buildings.

Under NAFTA, Mexico removed some of the last remaining tariffs on U.S. farm imports in January.

The government merely promised to push the United States and Canada for safeguards designed to protect Mexico’s corn and beans, products that are to be opened up to free trade in 2008, and to ”review” the rest of the agreements reached under NAFTA.

Mexico’s annual food imports rose from 7.79 billion dollars in 1982, when the country began to adopt free trade policies, to more than 11 billion dollars by 2001, noted researcher José Luis Calva at the National Autonomous University of Mexico.

Around 20 percent of Mexico’s labour force lives in the countryside, compared to just 2.6 percent in the United States. And productivity per hectare is 16 times higher in the United States than in Mexico.

In the United States, the average state subsidy for farmers is 122 dollars per hectare, against 53 dollars per hectare in Mexico – a situation that the new pact will do little to change. Farm organisations had demanded a doubling of subsidies.

Farm associations complain that because of NAFTA, Mexico now imports 95 percent of the soy beans consumed in the country, 58.5 percent of the rice, and 40 percent of the beef.

Among the demands set forth by farmers that were not addressed by the agreement were a curb to the freeing up of trade in farm products on the domestic market, the adoption of a system of price guarantees, a ban on imports and sales of transgenic crops, and a call for an amnesty for rural activists jailed on various charges.

Also ignored by the accord was the call for passage of a law on indigenous rights and culture that reflects the demands and grievances of the Zapatista National Liberation Army, a poorly- armed indigenous insurgent group in the southernmost state of Chiapas.

In fact, none of the organisations that signed the accord represents Mexico’s indigenous people, who comprise 10 percent of the population of 100 million, and who live mainly in rural Mexico.

According to official figures, 90 percent of the 25 million people who live in the countryside are poor.

The age-old problems plaguing the rural areas of Mexico persisted and were even aggravated despite the early 20th century agrarian revolution, in which around one million people died, and the seven decades of rule by the PRI (until the elections of 2000), a party that espoused rural causes and the ideals of the revolution, such as land reform.

”In spite of the government’s optimism, this accord is incomplete and overly vague, and it is yet to be seen whether it will be complied with,” said Maestre.

The most powerful rural groups taking part in the negotiations with the government were the National Campesino Confederation and the Permanent Agrarian Council, both of which are linked to the PRI, as well as the umbrella grouping The Countryside Can’t Take Anymore.

UNORCA and the Central Union of Peasant and Grassroots Organisations participated in the talks but refused to sign the pact.

Excerpt: