Defying free trade: Central American workers and farmers resist CAFTA

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In the U.S., the rightwing Heritage Foundation think tank cynically advises Congress to pass the Central American Free Trade Agreement (CAFTA) to bring “democracy, stability and raised living standards” to the region.

In Central America, masses of labor unionists, small farmers, indigenous people, women, students, environmentalists, and people with AIDS march against CAFTA. Sometimes they’ve been beaten and shot for exercising their “democratic rights.” But they have managed to stave off ratification in three countries.

With help from opponents of the treaty in the U.S., the battle to stop CAFTA may just be winnable. Ultimately, it depends on defeating this pact of misery and inequality in the U.S. Congress.

Global capital’s current target. The agreement, officially called DR-CAFTA because of the later inclusion of the Caribbean’s Dominican Republic, also covers Costa Rica, El Salvador, Guatemala, Honduras and Nicaragua. All of them are small countries, up against the U.S. giant’s newest maneuver to cement its economic domination of the hemisphere.

CAFTA’s mission is to deregulate industries, privatize public enterprises, abolish import tariffs, and further expose Central American economies to maquiladoras and control by foreign investors. It enforces U.S. patents that will price vaccines, AIDS drugs and other medicines out of reach.

Like the North American Free Trade Agreement among Mexico, Canada and the U.S., CAFTA lowers labor standards. It does not stop the U.S. from subsidizing American agribusiness, whose cheaper exports are decimating small farmers globally. It allows businesses to sue countries whose environmental laws “inhibit” trade.

Regional outcry. Central Americans held region-wide protests on October 12 in 2002 and 2004 and on May Day in 2004 and 2005. Over their opposition, however, the legislatures of El Salvador, Guatemala and Honduras ratified the treaty. In each of these countries at least 10 major demonstrations erupted involving tens and hundreds of thousands of people. They blockaded streets, highways, border crossings and airports.

Guatemalan resistance targeted agricultural and mining policies, taxes, and cuts to public education. El Salvador’s actions, the most massive in the region, included a general strike denouncing the privatization of healthcare and electricity and the elimination of labor and environmental protections.

International Women’s Day marchers oppose CAFTA in Guatemala on March 8, 2005
Despite ratification, Guatemalans, with teachers playing a leading role, are still holding major protests and calling for a national referendum on CAFTA. The Guatemalan military fired on demonstrators, killing a teacher and beating another protester to death. In El Salvador, too, opposition persists. On April 14, the National Police attacked a rally with rubber bullets and tear gas.

CAFTA ratifiers El Salvador, Honduras, and Guatemala have the area’s biggest textile industries and are the most dependent on U.S. trade. An arrangement giving preferential treatment to their textile industries expired in January, exposing them to competition from China, where wages are lower. Thus, they were under severe pressure to do what the U.S. wants.

Lawmakers in Costa Rica, Nicaragua and the Dominican Republic have not yet ratified CAFTA. Costa Rica is key, because it has a militant labor movement and the largest and most stable economy.

Costa Rica in an uproar. The country has a unique history of social-democratic reforms starting in the 1940s. The military was abolished in 1949. Education, healthcare, telecommunications, electricity, water, banking, oil and insurance are all nationalized. Costa Rica has the highest standard of living in Central America and is known for its pristine environment. But it has been under heavy attack by neoliberal capitalism. Its social security is being privatized bit by bit, the pension system is under siege, and foreign companies log and mine public lands.

Numerous large demonstrations have taken place. A strike by telephone and electrical workers in 2003 forced the government to temporarily withdraw from CAFTA negotiations and led to the resignations of four government ministers and other top economic advisers.

A summit of labor federations in mid-April of 2005 called for a general strike whenever the legislature debates the pact. In response, President Abel Pacheco hastily postponed the discussion — and announced he was forming a commission to “study” CAFTA’s impact on the poor.

Nicaragua, another holdout, continues to have demonstrations of thousands, with a broad coalition of groups rebelling against the threat of water privatization and of catastrophe for farmers.

The U.S. has been stymied in its drive to impose “free trade” via the World Trade Organization and Free Trade Area of the Americas. Big countries with significant agriculture, like India and Brazil, have resisted pitting their farm products against cheaper U.S. imports. This has forced the U.S. to turn its predatory eye to smaller trade blocks, in part to pressure the larger holdouts. Hence, CAFTA, and gigantic opposition to it.

Pressure Congress to say no! Central Americans are fighting for their lives against the treaty, and scoring successes. But the way to stop CAFTA for good is to stop it in the USA.

The U.S. usually waits for other countries to ratify a trade pact before it goes to Congress. But, with CAFTA, the upsurge in Central America has forced the administration’s hand. Congressional hearings began on April 21, with a vote possible by the end of May. Because of “fast track” authority over trade agreements, debate is limited and no amendments are allowed.

Although Congress has heard anti-CAFTA testimony from Central American Catholic bishops, U.S. bishops and Catholic Relief Services have refused to take a stand. But the AFL-CIO, 10 major environmental groups, and many social justice organizations are fighting the treaty. The Labor Council for Latin American Advancement, League of United Latin American Citizens, and Central American immigrant groups are also opposed.

A massive call-in to Congress took place April 13. On May 10, the New York Times reported that the White House admits it does not currently have the votes for passage. Still, it has not given up. Call and write your congressional representatives now. By showing solidarity with workers to the south, U.S. working people can make a critical difference!

For more information about CAFTA, visit and see the April-May and June-July 2004 issues of the FS.

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