Manuel Bermúdez

SAN JOSÉ, Dec 30 2005 (IPS) — The U.S. government failed in its desperate bid to see the Central America Free Trade Agreement (CAFTA) go into effect by the New Year’s Day deadline.

Implementation was held up by the slow progress made by the five Central American countries plus the Dominican Republic – which negotiated the treaty with the U.S. – when it came to ratifying it in Congress and fulfilling the requisite conditions for it to enter into force.

Meanwhile, the sense of uncertainty as to its benefits for the poorest countries continues to grow.

The countries that so far have moved closest to putting CAFTA into effect are Honduras and El Salvador, which are also two of the nations that depend most heavily on remittances from migrants living in the United States.

But neither those two countries nor the rest of the nations that signed the agreement on May 24, 2004 in Washington D.C. – Costa Rica, Guatemala, Nicaragua and the Dominican Republic – will be able to implement the accord by Jan. 1, 2006, despite the pressure from the Bush administration and U.S. lawmakers.

Washington’s anxiousness became evident earlier this month when Christian Baker, spokeswoman for the Office of the US Trade Representative, said the U.S. was prepared to put the treaty into effect on Jan. 1, as initially foreseen, but with those countries that had met the necessary conditions.

Her statements were followed by several visits by U.S. diplomats and members of Congress to the region to attempt to avoid another slipup for U.S. foreign policy, especially given the fact that Bush, when urging Congress to ratify CAFTA in July, described the agreement as a question of national security.

A delegation of seven U.S. legislators travelled to Costa Rica to meet with that country’s foreign affairs commission, in order to press for the acceleration of the congressional ratification of the free trade agreement.

Costa Rica is the only country whose legislature has not yet approved the treaty. But Congress will not debate the issue until the current recess ends following the Feb. 5 elections.

U.S. Democratic Representative Gregory Meeks said Costa Rica should not depend on the Caribbean Basin Initiative (CBI), an indefinite arrangement under which most products from the region enter the United States free of tariffs.

José Miguel Corrales, a lawmaker with Costa Rica’s Patriotic Union party, complained that the veiled threat that the CBI could be cancelled by Washington amounted to inappropriate pressure.

The National Association of Public Employees (ANEP) had a similar reaction to remarks by U.S. Ambassador to Costa Rica Mark Langdale, who told the local newspaper La Nación that Costa Rica’s international reputation could be ruined if it did not make faster progress towards approval of the free trade agreement.

ANEP protested the ambassador’s statements and denounced Meeks’ implied threat that the CBI could be revoked as meddling in Costa Rica’s internal affairs.

In the face of the reluctance of lawmakers in Costa Rica to ratify CAFTA, the U.S. representatives emphatically stated that the agreement could not be renegotiated.

In the case of Nicaragua, the accord may go into effect in February, but that depends on legislative approval of intellectual property and copyright laws, in order to make it easier to crack down on crimes involving piracy, licences and the use of trademarks, said Nicaraguan Deputy Minister of Industry and Commerce Julio Terán.

Experts attribute the delay in the implementation of CAFTA to its complexity. While it involves a number of countries, it is basically bilateral in nature, in that it addresses trade relations between each specific nation and the United Sates.

On Thursday, Honduran Minister of Industry and Trade Irving Guerrero admitted that his country was not ready for the agreement to enter into force this Sunday, despite the fact that the legislature has already approved the required rules concerning intellectual property, phytosanitary measures, public services and other areas.

While the legislative adjustments required in each country are different, the main stumbling blocks in most cases have been intellectual property, and environmental and labour legislation.

Analysts warn that the trade deal’s requirements with regard to labour conditions run counter to the achievements made by workers in getting important advances incorporated into the legislation of their respective countries, including pension rights, severance pay, social security and the right to organise trade unions.

Miguel Montenegro, director of the Human Rights Commission of El Salvador (CDHES), told IPS that the reforms promoted by the government this month to fulfil U.S. demands will have a particularly heavy impact on workers and will exclusively benefit transnational corporations.

Montenegro also reported that as the authorities rush to pave the way for the arrival of foreign investors, entire communities have been displaced to make way for the factories and warehouses of large companies, as is the case in the port of Cutuco.

Moreover, the “maquiladora” or duty-free industrial zones that will especially benefit from the treaty have long been notorious for blatant abuses of workers’ rights, he added.

In the activist’s view, the challenge now facing civil society is to more effectively organise in order to confront the effects of the agreement and to demand compliance with the country’s constitution and the Convention on Social, Economic and Cultural Rights, known as the San Salvador Protocol.

When CAFTA enters into effect, 80 percent of U.S. exports to the region will enter tariff-free. In addition, 15 years from now, trade in agriculture will benefit U.S. producers over Central American peasant farmers because of the latter’s limited access to credit and new technology.

Guatemala has also confirmed that it will not be able to comply with the agreement’s requirements before Feb. 1, because it will need to adopt reforms to the country’s intellectual property, environmental and labour legislation.

For its part, the Dominican Republic announced that it cannot implement the trade pact until after Jul. 1, because it still needs to undertake tariff and tax reforms.

In the meantime, the massive mobilisation of social forces against CAFTA was clearly demonstrated at the sixth Meso-American Forum held earlier this month in San José.

More than 600 civil society organisations from southern Mexico and the seven Central American nations stressed that the agreement will eliminate tariffs on over one half of the United States’ current agricultural exports to the region, including high-quality cuts of meat, cotton, wheat, fruits and vegetables, and processed foods.

Furthermore, U.S. companies will be free to invest in sectors like telecommunications, tourism, energy, transportation, construction, financial services and insurance.