While the Bush Administration continues
to push its free trade agenda around the globe there are signs of progress for communities of resistance, and signs that the
Bush Administration itself is adjusting its priorities in the face of worldwide resistance to the Free Trade model.
In mid-April it was announced that Rob Portman was resigning as the U.S. Trade Representative (USTR) to become the Director
of the President’s Office of Management and Budget. Portman is a man of considerable clout in Washington, and the President’s choice to re-locate him may be a sign that he is lowering expectations
for advancing his trade agenda. This comes on the heels of a year that has seen several victories for popular resistance against
neo-liberal free trade agreements imposed by the U.S. on trading partners in the Global South. Evidence of the growing strength of this
resistance recently materialized in Southern Africa and has been particularly evident in Latin America where massive opposition
to U.S. economic domination among the population, including massive street demonstrations, have enabled populist leaders and
parties to gain control of national governments in Bolivia, Ecuador, and possibly Peru, joining other countries in a shift
to the left.
Presidential candidates have promised
to fix the economic reforms of the last 25 years, and this promise has won elections in Argentina, Brazil, Ecuador, Bolivia, Uruguay and Venezuela. This is not surprising if one looks at the basic economic facts: the last 25 years have
been an unprecedented failure for Latin America.(1)
Newly elected president of Bolivia,
Evo Morales, has declared Bolivia will never negotiate a free trade agreement with the U.S.,
and recently released a Peoples Trade Agreement (PTA) outlining guiding principles for the type of trade agreements Bolivia
seeks with other countries. The PTA prioritizes protecting national industries and internal production, and human well
being.
U.S.-SACU
The United States-Southern Africa Customs
Union FTA (U.S.-SACU FTA) negotiations began in June 2003 and have been in a state of start and stop ever since. On April
18th, the SACU countries again rejected a “comprehensive” FTA that would have included all economic sectors, and
worked from the same template the U.S. has used for trade agreements in Latin
America, Southeast
Asia, North
Africa and the Middle East. SACU countries were particularly concerned
about protecting post-apartheid affirmative action policies and against aggressive liberalization demands in the services
negotiations. Instead, discussion appears to be heading down a path of a “Trade Investment Cooperation Agreement”
(TICA) — the first of its kind. The TICA steps away from the all-or-nothing agenda and sets up a mechanism for
developing work programs in areas that could lead to memoranda of understanding around certain areas typically included in
an FTA like customs, trade facilitation, and even intellectual property. This is in part a victory because the U.S. has
been unwilling to set a precedent of an agreement that is less aggressive then CAFTA and the recent U.S.-Peru agreement.
However, this new strategy may be even less transparent and a back door mechanism for avoiding a need for Congressional approval.
WTO
Negotiations at the World Trade Organization
(WTO) continue to flounder. The 6th Ministerial in Hong Kong last December produced a more aggressive negotiating framework in services (GATS) negotiations
and an aggressive timeline for concluding the Doha Round by the end of the year. Although the last two months have seen
a number of negotiating efforts in the form of a mini-ministerial between select WTO members, the WTO did not meet the April 30th deadline for finalizing “modalities” in agriculture
and manufacturing (NAMA) casting the meeting of other deadlines into doubt. In an attempt to save the negotiations, WTO
Director-General Pascal Lamy has called for continuous negotiations over the first few weeks of May.(2)
CAFTA
Last July the U.S. Congress ratified the
Central American FTA (CAFTA) by a mere two votes after extensive arm twisting and pork barrel deals by the Bush Administration.
U.S., El Salvador, Guatemala, Honduras,
Nicaragua, and the Dominican
Republic have ratified the agreement, Costa Rica,
has yet to do so. The closeness of the vote in Congress was a significant accomplishment for AFSC’s Stop the CAFTA Vote campaign and others. Thanks to continued work by
U.S. activists, many Representatives’ pro-CAFTA vote may cost them their office come
November elections. In Costa Rica, a virtually unknown opposition candidate, Otton Solis of the Citizens’ Action Party,
who ran primarily on an anti-CAFTA platform, almost defeated former President and Nobel Peace Prize winner Oscar Arias in
the Presidential election last February. The election was a virtual tie that took several weeks and a recount to determine
Arias as the winner.
Andean FTA's
Because of strong opposition to the Andean
Free Trade Agreement (AFTA) in Ecuador, the U.S. shifted to negotiating individual agreements with Peru and
Colombia. Peru and the U.S. officially signed the U.S.-Peru FTA
on April 12, 2006. After presidential elections that gave nationalist and anti-FTA candidate Ollanta
Humala a small majority in a three-way race, Peruvian President Alejandro Toledo flew to D.C. to witness the signing of the
agreement, which he made sure took place before leaving office on July 28. The FTA faces strong opposition from the
Peruvian public. A referendum against the deal gained 60,000 signatures and after being accepted by the National Elections
Board the referendum will now move on to the Peruvian Congress.
The future of the FTA depends largely on who wins the run-off Presidential election in late May, which is reflected in the
U.S. Trade Representative’s recent announcement that they will not take it before Congress until after Peru does.
The U.S.-Colombia FTA negotiations were completed on February 27, 2006. This
FTA is being pushed forward despite considerable opposition in rural areas, particularly among indigenous peoples and Afro-Colombians;
and widespread concern that the implementation of the FTA will intensify violence in the country (see Trade and Militarization in Colombia). In pursuing a policy of “democratic security” similar to the United State’s Patriot Act the Colombian
government has singled out indigenous and Afro-Colombia communities as “terrorists” for resisting their policies
of militarization and trade with the U.S. When leaders from the Nasa indigenous community organized a referendum on
the free trade agreement in six mostly indigenous municipalities of the southwestern province of Cauca that mobilized 51,330
voters out of a total of 68,448 registered voters with 98 percent voting against the FTA, the President stated that there
were “dark forces of terrorism” organizing these plebiscites and accused indigenous peoples of knowing nothing
about trade.
In Ecuador, popular opposition to AFTA or a bilateral trade agreement with the U.S. in part led to the ousting
of President Lucio Gutierrez last April and continues to apply extensive pressure on the current administration. Beginning
on March 13, 2006, massive mobilizations led by the Confederation of Indigenous Peoples of Ecuador (CONAIE)
with the support of a broad cross-section of Ecuador’s population forced the government and business leaders to publicly debate the implications
of a free trade agreement with the U.S., an unprecedented achievement. To learn more about how CONAIE and Ecuadorian
civil society are holding their government accountable in the defense of life and national sovereignty visit CONAIE’s website
The Peoples Trade Agreement
Strong ties between Venezuela’s
Hugo Chavez, Cuba’s Fidel Castro, and Bolivia’s Evo Morales,
along with other major economies like Argentina and Brazil charting their own path and rejecting U.S. dictated economic policy
has created the potential for real alternatives in the Western
Hemisphere. Additionally, with Venezuela’s
massive oil revenues it can extend credit to countries that no longer want to march to the tune of the International Monetary
Fund (IMF) and other lending institutions. The Bolivian Peoples Trade Agreement (PTA) released in April 2006 represents
an exciting alternative to the neo-liberal free trade model. The PTA emphasizes indigenous culture, reciprocity, solidarity,
and national sovereignty. Above all the PTA emphasizes improved human well being for the whole population as the desired
outcome of trade and investment, rather than wealth accumulation for the few.
Bolivia was one of the first countries to implement the IMF’s structural adjustment policies
which have since become a staple of neo-liberal economic globalization. Beginning in the mid 1980s Bolivia followed
almost all the recommendations coming from the IMF including raising interest rates, cutting public spending, privatizing
state owned industries and public services, and opening their economy to foreign trade. While the initial “shock
therapy” package created by the IMF succeeded in reigning in hyper-inflation the long term performance of these reforms
has been poor and Bolivia’s per capita income is lower today than it was in 1978.(3)
On January 22, 2006,
Evo Morales of the Movement for Socialism Party assumed the presidency with a clear majority of 54% of the vote. Morales,
who is Quechua, is the first indigenous president of this predominantly indigenous nation. Previously, Morales was a
leader of the largely indigenous coca growers union, and led workers, peasants, and ingenious peoples in stopping a deal that
would have given control of Cochabambas’ water services to the transnational corporation Aguas de Tanari during the
Water War of 2000. The deal would have made water services unaffordable for the majority of Cochabambinos (the term
for residents of Cochabamba).
Last May Bolivia
passed a Hydrocarbons Law that raised royalties paid by foreign gas companies. While this has angered many in the U.S. and
goes against free trade ideology it has provided tens of millions of dollars in revenue
for the government(4) and may enable them to sever ties with the IMF, as Brazil and Argentina are working towards. The PTA released by the
Morales government outlines the type of trade policy Bolivia now seeks. In its own
prose, the PTA is what free trade is not:
If the FTA's are negotiated in secret,
the PTA needs the active participation and discussion of social movements, who through using our new political instrument,
have begun to govern Bolivia for Bolivians.
The objectives [of the PTA] are to
strengthen small producers, micro-businesses, cooperatives and communitarian enterprises and to facilitate the interchange of goods with external markets.(5)
The PTA also emphasizes that it serves
to rebuild the state rather than dismantle it, and to foster an indigenous
vision of development:
Recovering the essence of indigenous
culture, the PTA postulates complementarity rather than competition, living in harmony with nature rather than irrational
resource exploitation; defense of social property versus extreme privatization; the promotion of cultural diversity rather
than mono-culture and uniformity of markets and consumption patterns.
The PTA sets forth 10 principles for developing
trade agreements that reemphasize micro-production, solidarity, sustainability, and communitarian development. Central
to the philosophy of the PTA is that countries must be free to determine what development path suits their respective history
and culture (view the entire PTA proposal).
Conclusion
The people of Latin America know how free trade has impacted
their lives – negatively. Because of the massive failure of neo-liberal economic reforms in the region(6) people have called for change, and political change has taken place in six South American countries. This to an extent
is the fruit of long term movement against corporate-globalization, and also indigenous peoples’ and other movements
that proceeded. Changing economic dynamics globally, such as the growth of China
and India, and the recent economic success of Argentina and Venezuela
are opening up new possibilities for regional economic relationships. The U.S. economy
is no longer the only game in town, but can Bolivia and other countries seeking alternative economic policies turn their vision into reality?
If the global solidarity movement against corporate globalization can bring the “free trade” steamroller
to a crawl, then their alternative vision might be possible.
1. Weisbrot, Mark, “Latin American ‘Populism’ Doing Well” Charlotte Observer, 3-20-2006
2. Pruzin, Daniel., “Lamy Calls for
Non-stop Ag, NAMA Talks After Admitting Missing Modalities Deadline” BNA: Daily Report for Executives 4-25-2006
3. Dolan, Mike, “Bolivia
seen likely to end IMF financing ties.,” Reuters 4-12-2006
4. Weisbrot, Mark, “Latin American ‘Populism’
Doing Well,” Charlotte Observer, 3-20-2006
5. Proposal from Bolivian President Evo Morales
concerning: A Peoples Trade Agreement http://quest.quixote.org/node/295
6. See Baker, Dean, Rosnick, David and
Weisbrot, Mark, Scorecard on Development: 25 Years of Diminished Development. Center for Economic and Policy Research,
September 2005
