CISPES Special Report:
After Cancún Collapse, Renewed Push for Central American Free Trade Agreement
In Attempt to Speed Up CAFTA negotiations, US Trade Representative Zoellick Takes Emergency Trip to Central America

October 1, 2003 The suicide by self-immolation of Korean farmer Lee Kyung Hae was only the most dramatic symbol of resistance to the World Trade Organization at its recent summit in Cancún, Mexico. Despite the millions of dollars invested in the meeting and the security forces surrounding it, neoliberal corporate globalization was handed a major defeat when the WTO negotiations broke down in acrimony on September 14. The US and Europe refused to negotiate on key agricultural issues, tenaciously holding on to their farm subsidies and import tariffs while demanding that developing nations eliminate theirs, terms that would bankrupt millions of small farmers across the Global South. In defense of their own agricultural interests and food security, negotiators from the so-called G-21 group of developing nations walked out of the summit, vowing not to return to the negotiating table until the US and Europe reversed their hypocritical stance on agriculture.

Outside of the conference center, on the other side of the multi-layered fences, a hand-lettered sign read, "Protesters 2 - WTO 1." In fact, two of the last three WTO summits have ended without an agreement; only in 2001 when the WTO fled to Doha, Qatar (a totalitarian state that prohibits public protest) were they able to meet undisturbed. As in Seattle, developing-nation negotiators in Cancún were empowered and emboldened by the tens of thousands of militant demonstrators in Mexico and those around the world who came together on September 13 for an International Day of Action Against the WTO. Using a variety of creative non-violent tactics, protesters from around the world brought their message to the delegates, and eventually penetrated the three layers of security that protected the hermetically-sealed negotiations. The breakdown of the Cancún WTO round truly shows the concrete power of mass protest to change policy.

One Latin American country pulled out of the G-21 group, prioritizing its privileged status as pet of the Bush administration over its population's need for food security and economic development. El Salvador was an original member of the G-21, perhaps acknowledging that the global coffee crisis brought on by neoliberal structural adjustment programs has decimated the country's own agricultural sector. Yet direct pressure from US Trade Representative Robert Zoellick forced El Salvador to retreat, and led negotiator Ricardo Reyes to dismiss Salvadoran farmers' concerns as "fear of the competition of the free market." In fact, Salvadoran producers understand that unfair competition on a market that is anything but free would flood El Salvador with low-priced US subsidized products, destroying their livelihoods. Such farmers have joined a new social-movement alliance called the Popular Social Block, which is demanding an immediate end to free trade negotiations.

The fundamental law guiding neoliberal globalization is one of expansion; if unable to expand, it will collapse in upon itself. For this reason, the failure of the Cancún WTO summit has placed the entire neoliberal project in jeopardy: in the words of Focus on the Global South's Walden Bello, "the collapse of the Cancun ministerial will be difficult, perhaps impossible, for the WTO to recover from." Scrambling to recuperate, Zoellick announced that he will now focus on bilateral agreements such as the US-Central American Free Trade Agreement (CAFTA) and the Free Trade Area of the Americas (FTAA). Zoellick seeks to push through CAFTA not because Central America is such an important market for the US, but because Central America is strategic to the US government's political and economic interests: as small countries like El Salvador and Guatemala are brought into bilateral trade agreements, large countries like Brazil and India feel more pressure to accept the same unequal terms in fear of being left behind.

Zoellick and the USTR has shifted into overdrive on CAFTA, and Zoellick himself is in Central America this week as part of an emergency visit. CAFTA negotiations have stalled over issues like agriculture, market access, textiles, and labor regulations, and the timeline of finalizing the treaty by December now looks unlikely. Still, in dire need of a trade victory, the Bush administration is looking to lock up CAFTA before the 2004 presidential campaign officially begins.

With so much riding on CAFTA, the US will pursue the most favorable terms possible in key economic areas. Charles Grassley, a prominent Republican in the US Senate, has demanded that Guatemala and Costa Rica be excluded from the treaty as punishment for their support of the G-21 group. Other members of Congress have expressed skepticism over CAFTA in general, and continue to insist that the deal primarily benefit US sugar producers and other agricultural interests. While it is unlikely that the two G-21 countries actually be removed, the US is using these threats to force them into accepting onerous conditions. For example, in Costa Rica, strong union mobilizations had managed to pressure the government into taking a stand against the privatization of electricity and telecommunications, which runs against the US's plans for market access. Now, Zoellick will seek to pressure Costa Rica into backpedaling on its principled anti-privatization stance.

At the same time, the US government may now be willing to concede issues of lesser importance within the negotiations, like labor and the environment. The Congressional Hispanic Caucus has promised to vote against CAFTA if it contains the same labor provisions as the recently-signed US-Chile Free Trade Agreement. US trade negotiators would likely include stronger labor clauses if they believed this was the only way to ensure Congressional approval of CAFTA; after all, they know that these clauses have never been enforced in NAFTA or any other free trade agreement. This is why workers and farmers in Central America reject the idea of tacking side agreements onto CAFTA: even if they were enforced, these side agreements would be little compensation for the total economic and social devastation that CAFTA would wreak on their communities.

Instead of calling for side agreements, the people of Central America continue to resist CAFTA and all free trade negotiations. Tens thousand of Nicaraguans marched in Managua at the seventh CAFTA negotiating round, demanding an immediate end to the talks. In El Salvador, hundreds of thousands have taken to the streets in protest against the privatization of health care and CAFTA. There, the FMLN party is opposing the free trade model in its run for the presidency in 2004. Given the mobilizing in Central America, the huge protests expected for the November FTAA ministerial meetings in Miami, and the increasing importance of CAFTA in the US Congress, the time is right for stepping up our anti-CAFTA organizing. After our victory in Cancún, the defeat of CAFTA could prove to be another turning point in the world-wide struggle against corporate globalization.

Back to the Home Page
Back to the Resources