Emad Mekay

WASHINGTON, May 13 2005 (IPS) — Leaders of the United States and six Central American and Caribbean nations are stepping up efforts to overcome lawmakers’ opposition to the U.S.-Central American-Dominican Republic free trade agreement (CAFTA-DR).

The moves come even as critics ratchet up their opposition to the trade pact, by far the most controversial proposed by the White House since President George W. Bush took office in 2001.

The presidents of Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the Dominican Republic visited 10 U.S. cities to drum up support for the pact earlier this week before lobbying members of the U.S. Congress Wednesday and meeting Bush at the White House Thursday.

Bush has yet to send CAFTA-DR, signed one year ago by the five Central American leaders and subsequently expanded to include the Dominican Republic, to Congress for approval. The deal is expected to come for a vote in Congress later this spring. Meanwhile, Bush promised the regional leaders he would intensify campaigning for approval.

”I assured them I will join in the efforts to get this bill passed,” Bush told reporters after meeting his counterparts Thursday. ”This bill is good for Central American countries, it is good for America.”

The Bush administration has said that CAFTA-DR will promote economic growth, raise incomes, and promote freedom in a region of strategic interest to the United States.

”For the newly emerging democracies of Central America, CAFTA would bring new investment. That means good jobs and higher labor standards for their workers,” Bush said.

”By passing CAFTA, we would open up a market of 44 million consumers who already import more of our goods and services than Australia or Brazil,” he added.

Few Democrats in the House of Representatives have come out in support of the pact and the measure faces opposition in the Senate because of concerns about its likely impact on U.S. sugar and textile producers.

Democrats have said the pact is doomed because the U.S. administration failed to negotiate higher labour and environmental standards to be followed by Central American governments.

”CAFTA says to these countries with woefully inadequate laws and practices, just enforce your own laws. This is a double standard not accepted in any other area of international trade, including CAFTA itself,” Sander Levin, the top Democrat on the House of Representatives trade subcommittee, said in a statement.

For its part, the administration has said the pact’s labour and environmental provisions meet guidelines set by Congress in 2002 and are as strong as those in free trade pacts with Morocco and Jordan, which many Democrats supported.

Democrats also have expressed concern that the deal will do little to ease, and could exasperate, the 617-billion-dollar U.S. trade deficit by allowing in more sugar and textile imports.

Even some lawmakers from Bush’s Republican Party have frowned upon CAFTA-DR as they see it opening up the U.S. market to more textile, sugar and citrus imports, jeopardising local producers.

Criticism of the deal among grassroots groups and civil society organisations also has been ferocious.

The CAFTA-DR nations already are key export market for U.S. information technology products, agricultural and construction equipment, paper products, chemicals, and medical and scientific equipment.

Under CAFTA-DR, half of all current U.S. farm exports to the area would become duty-free, including some beef, cotton, wheat, soybeans, fruits and vegetables, processed food products, and wine.

If it comes into effect, the deal will also immediately abolish tariffs on over 80 percent of U.S. manufactured exports to the area, with remaining tariffs eliminated within 10 years.

This has prompted opposition among producers in Central American countries who fear an ensuing glut of imports from the United States, especially in the heavily subsidised agricultural sector.

”DR-CAFTA poses a serious threat to farmers in my country who won’t be able to compete with highly subsidised U.S. producers,” said Victorio Valerio, president of the Dominican Republic’s National Federation of Rice Producers (FENARROZ), which says it represents 30,000 small-scale rice farmers in the country.

Valerio was in Washington this week among a delegation of regional activists opposed to the trade pact.

CAFTA is modeled after the North American Free Trade Agreement (NAFTA), an agreement that liberalised trade and investment between Mexico, Canada and the United States.

While its supporters say NAFTA has created jobs in Mexico, foes argue that after 10 years it has not improved the lives of millions of poor people there and also has cost the jobs of thousands of workers in Canada and the United States.

Civil society groups say among the many contentious points in CAFTA-DR, signatory countries are required to adopt new patent rules that will increase medicine prices.

According to deal documents from the U.S. Trade Representative’s Web site, countries would have to provide added protection to foreign investors. This threatens governmentsâÇÖ ability to implement, public interest, environment and health protections, critics say.

The deal also paves the way for those countries to further privatise and deregulate essential public services, potentially putting them permanently out of reach for millions of poor people.

But on the other hand, some U.S. businesses have been vigorously pushing for the CAFTA-DR deal.

Apart from its potential economic benefit to businesses, the deal is seen as a stepping-stone to the larger Free Trade Area of the Americas (FTAA), a zone that would encompass all countries in the western hemisphere except Cuba in a trade pact that would cover hundreds of millions of consumers.

The Business Coalition for U.S.-Central America Trade, made up of hundreds of major U.S. companies including Levi Strauss & Co., Motorola, and Wal-Mart Stores, Inc., has lobbied members of Congress to ratify the deal.

The Business Roundtable, another business group, also has run advertisements to drum up backing for the trade deal, tying it to U.S. economic growth.

A recent ad by the group complains that Central American products enter the United States free while U.S. products incur tariffs en route to Central American consumers.

”DR-CAFTA opens the trade road for American workers, farmers and businesses,” says the ad. ”Continued U.S. economic growth depends on trade”.

The World Bank also has endorsed the deal. In a report released Wednesday, the lending agency said that the pact would boost long-term growth and reduce poverty in Central America and the Dominican Republic.