Costa Ricans Resist The Wrath Of CAFTA

CAFTA blog With under two weeks to go before Costa Ricans vote our first ever referendum, which will be on whether or not to ratify a “free-trade” agreement with the United States and six other countries, known as the CAFTA (Central American Free Trade Agreement) in English and TLC in Spanish, a memo dated July 29 and written by two high-level government officials (the second Vice President and a  Congressman with close ties to Costa Rican President Oscar Arias) was leaked to the public this month.  The document outlines a series of “suggestions” for a campaign, which includes illegal threats to government officials such as withholding funds for public programs in their regions if their constituents repudiate CAFTA and a host of other dirty maneuvers intended to convince “simple” people to vote YES.

As evident from the memorandum, the authors also propose smearing CAFTA opponents by linking us with Chavez and Castro. They also call for a public relations campaign to "stimulate four kinds of fear" among citizens about the alleged dangers to Costa Rica if the NO should win.

CAFTA opponents have cried foul while supporters have suddenly found themselves on the defensive over a measure that they thought was headed to victory due to the fact that the YES campaign is supported by the economic and political powers and the media is practically at their disposal. Prominent CAFTA backers, including President Arias, have distanced themselves from the memo, which was addressed to him and his brother, Presidency Minister Rodrigo Arias, but it is hard to believe that a President receives a memo from two of his closest fellow high officials and does nothing.

One of the authors, Second Vice President Kevin Casas, has resigned and many are calling not only for the resignation of the second author, Congressman Sanchez (a close relative of the President) but for a full investigation into the strategies and monies of the YES campaign.  Until now and, only after the opposition demanded its intervention,  the Supreme Electoral Tribunal (TSE) which according to many has been partial to the YES people in more than one occasion,  has only called for an internal audit of the Ministry which was headed by Casas.

"This memo is actually a blessing," said a spokeswoman for Mujeres Contra el TLC, a coalition of women’s organizations who oppose CAFTA, "it proves that high elected officials have not complied with the referendum rules and procedures which call for a democratic and egalitarian process and most Costa Ricans will not tolerate that.”

The spokeswoman added that the memo had convinced many undecided voters who are fed up with corruption scandals in recent years:  “While before many voters thought that if Arias was so in favor of the treaty it must be good for Costa Rica, now that they have proof of the kind of people that back this treaty, they are not so sure.” What's clear is that the document has energized CAFTA opponents and embarrassed Arias just ahead of the crucial vote on October 7th.  Although he has insisted that none of the suggestions outlined in the memo were acted on, an analysis of the strategies used by the YES campaign shows that, on the contrary, most of the suggestions have already been carried out by the YES campaign and furthermore, that this campaign is actually headed by high government officials.

Few trade experts would have predicted that Costa Rica, Central America's most prosperous economy and a model of social stability for the region, would be so divided over CAFTA. It's the only member of the seven-nation deal that has yet to ratify the pact, which includes the United States, Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua.

CAFTA has proved so divisive among Costa Ricans that, after several different initiatives coming both from the government and from civil society, the TSE called a first ever referendum to allow voters to decide whether to ratify it.  And this could have been a very democratic way to solve the divide but the TSE has been so partial to the Yes people, for example, allowing high government officials to campaign in favor of the treaty, that the divide grows ever deeper as even the Vice President acknowledges in his now memorable memo.

Big Business and the current government are solidly behind the deal, saying it's the best way to maintain excellent trading relations with the United States, the destination for about half of Costa Rican exports of coffee, fruit, apparel and high-tech products, and its biggest source of direct foreign investment.

Opponents insist that if the CAFTA were such a good deal for Costa Ricans, why then were the negotiations held in secrecy and why were some of the Costa Rican negotiators paid by U.S. companies?  Most opponents do not believe that privatizations, government deregulation, unrestricted free market access for foreign corporations, and deep cuts in social spending can be what is needed to “develop” the region.  Most women insist that CAFTA will destroy our nation's unique social model. Costa Rica abolished its army in 1949, choosing instead to invest in education, universal healthcare and social programs that have made it a prototype of human development for the region.

“The benefits of CAFTA will flow mainly to Costa Rica's elite, making the country more like its impoverished neighbors” says Paquita Cruz, a member of Mujeres Contra el Combo. For example, I know by seeing what has happened in other countries that what CAFTA backers call “healthy competition” for our state-run Telecommunications, which has provided Costa Ricans with the lowest telecom rates in Latin America, will not only run it out of business, but it will leave us in the hands of one or two multinational corporations who will then divide up the market and do as they please as has happened in other parts of the region”.  “Furthermore, we do not want to “donate” our telecommunications infrastructure which has been built over the years with our taxes, to foreign corporations.”

Most Costa Rican farmers  produce mainly for the domestic market and see no need for  CAFTA. What is more, they fear a flood of subsidized U.S. agricultural commodities will wipe out their livelihoods.   "True we do not make tons of money, but this business has always been stable," dairy farmer Maria Villalobos said. “We prefer to work hard for not too much money on our own farms than to be employees in a large Agro Industrial Corporation.  We have heard about the kind of treatment agro industrial works get.  We also worry about the land and what will happen to it after years of great expanses of monocultures.”

The women of Mujeres contra el TLC reason that if the benefits of CAFTA were so patently obvious, then supporters wouldn't need to craft a clandestine campaign to scare people into voting for it.  “Why does the President need to lie about how the U.S. would retaliate against Costa Rica if citizens voted against the pact or that leftists such as Castro were bankrolling the "no" campaign” asks Roxana Arroyo, a lawyer, “it seems to me that if the treaty, which is more than just a trade agreement since it obligates us to modify our Political Constitution, is so wonderful, then why so many lies?”

CAFTA was barely passed by the U.S. Congress in late July 2006 after President Bush put on a masterly display of arm-twisting.    Mr. Bush argued that the deal would help gain political stability in the region and reduce a $2.3 billion deficit with the countries involved. But even supporters of the treaty say negotiators for the region did not have enough leverage to pry many concessions from the United States.  And, as has been found out later, many negotiators for the region were not really negotiating for the region since they were paid by U.S. multinationals.

Critics across the region, even in the countries that have already ratified it, see the pact as a one-way street, benefiting United States multinational corporations at the expense of Central America's small businesses, farmers, what is left of the commons, women and the region’s natural resources.

"Where is the evidence that this is going to develop us?" said Epsy Campbell, an economist who ran for vice president in the Citizen Action Party. "This is going to create more poverty and Central America will expel more people toward the U.S.A. and women will pay the highest price."

Opponents like her point to the experience of Mexico, whose 10-year experiment in “free trade” with the United States has depopulated much of the countryside and sent waves of migration north of the border as well as an increase in violence against women, especially in the now infamous Ciudad Juarez.

Rice farmers in Costa Rica see the so called “agreement” as an unmitigated disaster. Even though they have 10 years before the 35 percent duty on imported rice begins to disappear, most say they will never be able to compete with rice farmers in the United States, who receive huge subsidies.  For example, it costs about $250 to produce a ton of rice in both countries, but U.S. farmers can sell it on the world market for much less because of the subsidies.  “This is not fair trade” says Ana Rosa Ruiz, an economist, “this is how colonialists  have always done things”.

"It's impossible for us to be competitive with all the subsidies that the North Americans have," say many Costa Rican farmers.    At the same time, critics point out that vulnerable parts of the United States economy remain protected, even in areas where Central American negotiators managed small inroads, like sugar and textiles.

The agreement, for instance, leaves in place the price supports for American sugar, while opening the door only a crack, letting in imports equal to 1 percent of United States production.The part on textiles was also written to protect United States fabric and yarn factories, this time from Chinese competition. It requires that 90 percent of apparel turned out by Central America makers use American fabrics, which they can buy duty free.

Defenders of the pact say most of the complaints are born of fear of change. They insist there is only one way forward and that way is freer access to the U.S. market, even if that means many will loose their livelihoods.  According to the Yes people, ruined farmers can always shift to export crops or find other kinds of work. What they fail to mention is that this “other kind of work” is one with extremely low wages and no labor rights.  In a typically capitalist logic, the President said "We are condemned to be traders because we produce what we do not consume and we consume what we do not produce, that is why it is essential for us to have access to the U.S. market."  “You would think that a better plan would be for the national government to support farmers so that they can  produce what we Costa Ricans consume and educate the population to consume what we produce” said Paquita Cruz.

Some of the biggest winners are expected to be U.S. companies who already have manufacturing plants here, like Intel, Conair, subsidiaries of Lee and Wrangler jeans, and Rawlings Sporting Goods, which makes major league baseballs in Costa Rica and was in the news last year because of the horrible conditions their employees, mostly women, work under.

But for many Costa Ricans, the most difficult points in the treaty are not only those provisions that “open” the telecommunications market, protect the property rights of big American pharmaceutical companies from generic drug makers and permit the sale of human organs and the production of weapons in a country whose constitution does not permit the latter, but those that are not even trade related to begin with, such as the definition of what constitutes the Costa Rican territory or what the Costa Rica courts can or cannot do. "We see the free trade treaty as an instrument used for many things that don't have anything to do with business," said Epsy Campbell, "but with dismantling our model of social development."

For more information go to www.fire.or.cr

Alda Facio, a well-know Costa Rican feminist lawyer and a member of Mujeres Contra el TLC, a Global Fund grantee, wrote this article for F.I.R.E.  Photo Courtesy: Jimena Alvarado, a Costa Rican feminist activist currently working to promote awareness among the Costa Rican people about the devastating consequences that CAFTA will have over Central American economies.

 
 

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